[Federal Register: April 23, 2008 (Volume 73, Number 79)]
[Proposed Rules]               
[Page 21891-21892]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]



Defense Acquisition Regulations System

48 CFR Part 216

RIN 0750-AF90

Defense Federal Acquisition Regulation Supplement; Limitations on 
DoD Non-Commercial Time-and-Materials Contracts (DFARS Case 2007-D021)

AGENCY: Defense Acquisition Regulations System, Department of Defense 

ACTION: Proposed rule with request for comments.


SUMMARY: DoD is proposing to amend the Defense Federal Acquisition 
Regulation Supplement (DFARS) to address review and documentation 
requirements with regard to the use of time-and-materials contracts for 
the acquisition of non-commercial services. The proposed rule provides 
for the same level of review for both commercial and non-commercial DoD 
time-and-materials contracts.

DATES: Comments on the proposed rule should be submitted in writing to 
the address shown below on or before June 23, 2008, to be considered in 
the formation of the final rule.

ADDRESSES: You may submit comments, identified by DFARS Case 2007-D021, 
using any of the following methods:
    Federal eRulemaking Portal: http://www.regulations.gov.
    Follow the instructions for submitting comments.
    E-mail: dfars@osd.mil. Include DFARS Case 2007-D021 in the subject 
line of the message.
    Fax: 703-602-7887.
    Mail: Defense Acquisition Regulations System, Attn: Ms. Sandra 
Morris, OUSD (AT&L) DPAP (CPF), IMD 3D139, 3062 Defense Pentagon, 
Washington, DC 20301-3062.
    Hand Delivery/Courier: Defense Acquisition Regulations System, 
Crystal Square 4, Suite 200A, 241 18th Street, Arlington, VA 22202-
    Comments received generally will be posted without change to http:/
/www.regulations.gov, including any personal information provided.

FOR FURTHER INFORMATION CONTACT: Ms. Sandra Morris, 703-602-0296.


A. Background

    Section 16.601(d) of the Federal Acquisition Regulation (FAR) 
requires that, before using a time-and-materials contract, the 
contracting officer must prepare a determination and findings that no 
other contract type is suitable. For time-and-materials contracts for 
commercial services, FAR 12.207(b)(2) specifies the minimum content for 
the determination and findings, and FAR 12.207(c) contains additional 
requirements with regard to the use of indefinite-delivery contracts 
priced on a time-and-materials basis.
    To provide for the same level of oversight in the award of all DoD 
time-and-materials contracts, this proposed rule amends DFARS 216.601 
to establish determination and findings requirements for DoD non-
commercial time-and-materials contracts, similar to those presently 
required by FAR 12.207 for commercial services contracts.
    This rule was not subject to Office of Management and Budget review 
under Executive Order 12866, dated September 30, 1993.

B. Regulatory Flexibility Act

    DoD does not expect this proposed rule to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
because the proposed rule relates to internal DoD review and 
documentation requirements with regard to the selection of contract 
type. Therefore, DoD has not performed an initial regulatory 
flexibility analysis. DoD invites comments from small businesses and 
other interested parties. DoD also will consider comments from small 
entities concerning the affected DFARS subpart in accordance with 5 
U.S.C. 610. Such comments should be submitted separately and should 
cite DFARS Case 2007-D021.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply, because the rule does 
not impose any information collection requirements that require the 
approval of the Office of Management and Budget under 44 U.S.C. 3501, 
et seq.

List of Subjects in 48 CFR Part 216

    Government procurement.

Michele P. Peterson,
Editor, Defense Acquisition Regulations System.
    Therefore, DoD proposes to amend 48 CFR part 216 as follows:


    1. The authority citation for 48 CFR part 216 continues to read as 

    Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.

    2. Section 216.601 is amended by adding paragraph (d) to read as 

216.601  Time-and-materials contracts.

    (d) Limitations.
    (i) The determination and findings shall contain sufficient facts 
and rationale to justify that no other contract type is suitable. At a 
minimum, the determination and findings shall--
    (A) Include a description of the market research conducted;
    (B) Establish that it is not possible at the time of placing the 
contract or order to accurately estimate the extent or duration of the 
work or to anticipate costs with any reasonable degree of certainty;

[[Page 21892]]

    (C) Establish that the requirement has been structured to minimize 
the use of time-and-materials requirements (e.g., limiting the value or 
length of the time-and-materials portion of the contract or order; 
establishing fixed prices for portions of the requirement); and
    (D) Describe the actions planned to minimize the use of time-and-
materials contracts on future acquisitions for the same requirements.
    (ii) For indefinite-delivery contracts, the contracting officer 
    (A) Structure contracts that authorize time-and-materials orders to 
also authorize orders on a cost-reimbursement, incentive, or fixed-
price basis, to the maximum extent practicable; and
    (B) Execute the determination and findings for--
    (1) Each order placed on a time-and-materials basis if the 
indefinite-delivery contract also authorizes orders on a cost-
reimbursement, incentive, or fixed-price basis; or
    (2) The basic contract if the indefinite-delivery contract only 
authorizes time-and-materials orders. The determination and findings 
    (i) Contain sufficient facts and rationale to justify why orders on 
a cost-reimbursement, incentive, and fixed-price basis are not 
practicable; and
    (ii) Be approved one level above the contracting officer.
* * * * *

 [FR Doc. E8-8697 Filed 4-22-08; 8:45 am]