[Federal Register: November 24, 2008 (Volume 73, Number 227)]
[Rules and Regulations]               
[Page 70912-70913]
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: Final rule.


SUMMARY: DoD has issued a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to address review and 
documentation requirements pertaining to the use of time-and-materials 
contracts for the acquisition of non-commercial services. The rule 
provides for the same level of review for both commercial and non-
commercial DoD time-and-materials contracts.

DATES: Effective Date: November 24, 2008.

FOR FURTHER INFORMATION CONTACT: Ms. Angie Sawyer, Defense Acquisition 
Regulations System, OUSD (AT&L) DPAP (DARS), IMD 3D139, 3062 Defense 
Pentagon, Washington, DC 20301-3062. Telephone 703-602-8384; facsimile 
703-602-7887. Please cite DFARS Case 2007-D021.


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 rule amends DFARS 216.601 to 
establish determination and findings requirements for DoD non-
commercial time-and-materials contracts, similar to those required by 
FAR 12.207 for commercial services contracts.
    DoD published a proposed rule at 73 FR 21891 on April 23, 2008. DoD 
received no comments on the proposed rule. Therefore, DoD has adopted 
the proposed rule as a final rule without change.
    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 certifies that this final rule will not 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 rule relates to internal DoD review and documentation 
requirements with regard to the selection of contract type.

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, 48 CFR Part 216 is amended 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;

[[Page 70913]]

    (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;
    (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.
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[FR Doc. E8-27780 Filed 11-21-08; 8:45 am]