PN 97-29

PURPOSE: To specify that the clause at FAR 52.232-34, Payment by Electronic Funds Transfer--Other than Central Contractor Registration, is to be used for NASA contracts instead of the clause at FAR 52.232-33, Payment by Electronic Funds Transfer--Central Contractor Registration; establish that the use of a nondomestic EFT mechanism is authorized and provide direction as to the action that is to be taken when such a mechanism is used for a contract; and specify that the payment office is to be the designated office for the receipt of EFT information for all NASA contracts.

BACKGROUND: The FAR EFT coverage was revised on March 4, 1999 (64 FR 10538-10544). Included were changes to the solicitation provision and contract clauses coverage at FAR 32.1110. FAR 32.1110(a) requires that the clause at either FAR 52.232-33, Payment by Electronic Funds Transfer--Central Contractor Registration, or FAR 52.232-34, Payment by Electronic Funds Transfer--Other than Central Contractor Registration, be inserted in contracts depending on whether the Central Contractor Registration (CCR) database will be used. NASA has chosen not to use the CCR. Accordingly, the clause at FAR 52.232-34 is to be used. Another FAR change occurs at 32.1110(b), which states that the clause at FAR 52.232-33 or 52.232-34 needs to clearly address the use of a nondomestic EFT mechanism if the agency head has authorized their use. Use of a nondomestic EFT mechanism is authorized. Furthermore, FAR 32.1110(c) requires the clause at 52.232-35 be inserted in contracts if agency procedures permit the submission of EFT information to other than the payment office. The payment office is the designated office for the receipt of EFT information for all NASA contracts.

REGULATION: Changes are made in Part 1832 as set forth in the enclosed replacement pages.

REPLACEMENT PAGES: You may use the enclosed pages to replace Structure page 5, Structure page 6, and Part 1832 of the NFS. In section 1852.219-79, subparagraphs (b)(1) - (4) were omitted in PN 97-25. Replace pages 52:27 and 52:28. In PN 97-26, the Matrix placed provisions 1852.242-74 and 1852.242-77 in section "I" instead of section "L". These corrections have been made. Replace pages 52-97 and 52-98. Also, miscellaneous revisions were made to NASA Form (NF) 1098, Checklist for Contract Award File Content. Replace pages 53-29 and 53-30.

REGULATORY COMPLIANCE: This PN was published as a final rule in the Federal Register (64 FR 18372 - 18373, April 14, 1999).

EFFECTIVE DATE: This PN is effective May 3, 1999, and shall remain in effect until canceled or superseded.

HEADQUARTERS CONTACT: Joseph Le Cren, Code HK, (202) 358-0444, email: joseph.lecren@hq.nasa.gov.

R. Scott Thompson
Director, Contract Management Division

Enclosures

1825.3 Balance of Payments Program

1825.4 Trade Agreements

1825.6 Customs and Duties

1825.9 Additional Foreign Acquisition Clauses

1825.70 Foreign Contracts

1827.3 Patent Rights Under Government Contracts

1827.4 Rights in Data and Copyrights

1827.6 Foreign License and Technical Assistance Agreements

1828.1 Bonds

1828.2 Sureties

1828.3 Insurance

1829.1 General

1829.2 Federal Excise Taxes

1830.2 CAS Program Requirements

1830.70 Facilities Capital Employed for Facilities in Use or for Facilities Under Construction

1831.2 Contracts with Commercial Organizations

1832.1 Non-Commercial Item Purchase Financing

1832.2 Commercial Item Purchase Financing

1832.4 Advance Payments for Non-Commercial Items

1832.5 Progress Payments Based on Costs

1832.7 Contract Funding

1832.9 Prompt Payment

1832.10 Performance-Based Payments

1832.11 Electronic Funds Transfer

1833.1 Protests

1833.2 Disputes and Appeals

1834.0 General

1836.2 Special Aspects of Contracting for Construction

1836.5 Contract Clauses

1836.6 Architect-Engineer Services

1836.7 Standard and Optional Forms for Contracting for Construction, Architect-Engineer Services, and Dismantling, Demolition, or Removal of Improvements

1836.70 Partnering

1837.1 Service Contracts--General

1837.2 Advisory and Assistance Services

1837.70 Acquisition of Training

1839.1 General

1841.2 Acquiring Utility Services

1841.3 Requests for Assistance

1841.4 Administration

1841.5 Solicitation Provision and Contract Clauses

1842.1 Interagency Contract Administration and Audit Services

1842.2 Assignment of Contract Administration

1842.3 Contract Administration Office Functions

1842.5 Postaward Orientation

1842.7 Indirect Cost Rates

1842.8 Disallowance of Costs

1842.12 Novation and Change-of-Name Agreements

1832.006-2 Definitions.

1832.111 Contractor clauses for non-commercial purchases.

1832.111-70 NASA contract clause.

1832.202-1 Policy.

1832.206 Solicitation provisions and contract clauses.

1832.402 General.

1832.406 Letters of credit.

1832.407 Interest.

1832.409 Contracting officer action.

1832.409-1 Recommendation for approval.

1832.409-170 NASA procedure for approval.

1832.410 Findings, determination, and authorization.

1832.412 Contract clause.

1832.412-70 NASA contract clauses.

1832.501 General.

1832.501-1 Customary progress payment rates.

1832.501-2 Unusual progress payments.

1832.502 Preaward matters.

1832.502-2 Contract finance office clearance.

1832.502-4 Contract clauses.

1832.502-470 NASA contract clause.

1832.504 Subcontracts.

1832.702 Policy.

1832.702-70 NASA policy.

1832.704 Limitation of cost or funds.

1832.704-70 Incrementally funded fixed-price contracts.

1832.705 Contract clauses.

1832.705-2 Clauses for limitation of cost or funds.

1832.705-270 NASA clauses for limitation of cost or funds.

1832.906 Contract financing payments.

1832.908 Contract clauses.

1832.1004 Procedure.

1832.1005 Contract clauses.

1832.1006 Agency approvals.

1832.1009 Title.

1832.1110 Solicitation provision and contract clauses.

The Associate Administrator for Procurement is the Agency remedy coordination official.

The contracting officer shall insert the clause at 1852.232-79, Payment for On-Site Preparatory Costs, in solicitations and contracts for construction on a fixed-price basis when progress payments are contemplated and pro rata payment of on-site preparatory costs to the contractor is appropriate.

(b)(6) Advance payment limitations do not apply to expendable launch vehicle (ELV) service contracts. (see 1832.402).

(g)(2) The installment payment rate shall be that which is common in the commercial marketplace for the purchased item. If there is no commonly used rate, the contracting officer shall determine the appropriate rate. In no case shall the rate exceed that established in the clause at FAR 52.232-30.

(e)(1) The Director of the Headquarters Office of Procurement Contract Management Division (Code HK) is the approval authority for all advance payments except the following:

(A) The procurement officer is the approval authority for non-fee bearing contracts with domestic entities when the cumulative contract value is $25,000,000 or less, and for all increases to such contracts over $25,000,000 previously approved by the Headquarters Office of Procurement as long as the advance payment amount outstanding at any time is not increased.

(B) The contracting officer is the approval authority for the following actions. In these cases, a findings and determination (see FAR 32.410) is not required.

(a) Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) Phase I contracts. A class deviation has been signed, effective through September 30, 2000 (for SBIRs) and September 30, 2001 (for STTRs), authorizing use of advance payments on these contracts. The contracting officer shall annotate the contract file that the deviation is on file at the NASA Headquarters Office of Procurement (Code HK).

(b) Expendable launch vehicle (ELV) service contracts. 42 U.S.C. 2459c authorizes advance payments for these contracts. The contracting officer shall document the contract file with the rationale for approving the use of advance payments.

(e)(2) All advance payment authorization requests, except those authorized by 1832.402(e)(1)(B), shall be coordinated with the installation Deputy Chief Financial Officer.

(b)(1) Each installation is considered a contracting agency for the purposes of this requirement.

(d)(1) Advance payments without interest are authorized.

In addition to the items listed in FAR 32.409-1, requests for Headquarters approval of advance payments (see 1832.402(e)(1)) shall include the following information:

(a) Name of the cognizant NASA Headquarters program or staff office;

(b) Name and phone number of the contracting officer or negotiator;

(c) A copy of the proposed advance payments clause;

(d) If a profit/fee is contemplated, the factors considered in determining the profit/fee (see 1815.404-470);

(e) Information justifying the adequacy of security to cover the maximum advance payment amount at any time outstanding.

(b) Generally, the format in FAR 32.410 should be used, tailored as follows:

(i) In format subparagraph (a)(2), use the phrase "Advance payments (in an amount not to exceed $..... at any time outstanding)" in all determinations and findings. The phrase means the maximum unliquidated dollar amount a contractor would need in advance payments at any point in time for the particular contract. The amount would not usually be the full contract value. The amount inserted should be based on an analysis of the contractor's financing needs (monthly or other appropriate period) for the specific contract involved.

(ii) In the second sentence of format subparagraph (a)(4), delete the reference to a special bank account if no special bank account is required.

(iii) Use format subparagraph (a)(6), not (a)(7) or (a)(8).

(iv) At the end of format paragraph (b), use "is in the public interest."

(v) in format paragraph (c), use the phrase "(the amount at any time outstanding)" in all determinations and findings.

(e) The contracting officer shall use Alternates IV and V when advance payments are

provided on Phase I contracts of the Small Business Innovation Research (SBIR) or Small Business Technology Transfer (STTR) programs.

(f) See 1832.412(e).

When the clause at FAR 52.232-12 or its Alternates II or V are used, insert the clause at 1852.232-70, NASA Modification of FAR 52.232-12.

(a) The customary progress payment rate for all NASA contracts is 85 percent for large business, 90 percent for small business, 95 percent for small disadvantaged business, and 100 percent for Phase II contracts in the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs. The contracting officer shall insert the applicable percentage in paragraphs (a) and (b) of the clause at FAR 52.232-16.

The Director of the Headquarters Office of Procurement Contract Management Division (Code HK) is the approval authority for the use of unusual progress payments.

1832.502 Preaward matters.

The Director of the Headquarters Office of Procurement Contract Management Division (Code HK) is the approval authority for the actions at FAR 32.502-2, except the Associate Administrator for Procurement (Code HK) is the approval authority for any deviations addressed in FAR 32.502-2(b).

The contracting officer may insert a clause substantially as stated at 1852.232-82, Submission of Requests for Progress Payments, in fixed-price solicitations and contracts that provide for progress payments. The recipient of the requests and number of copies may be changed as required.

(c) Unusual progress payments to subcontractors shall be approved in accordance with 1832.501-2.

(a) Cost-reimbursement contracts may be incrementally funded only if all the following conditions are met (except that, for cost-reimbursement R&D contracts under which no supplies are deliverable, only the condition in subparagraph (a)(3) of this subsection applies):

(1) The total value of the contract (including options as defined in FAR Subpart 17.2) is $1,000,000 or more.

(2) The period of performance under the contract overlaps the succeeding fiscal year.

(3) The funds are not available to fund the total contract value fully at award.

(b) Fixed-price contracts, other than those for research and development, shall not be incrementally funded.

(c)(1) Fixed-price contracts for research and development may be incrementally funded if the conditions in 1832.702-70(a)(1)-(3) are met and the initial funding of the contract is not less than 50 percent of the total fixed price.

(2) Incrementally funded fixed-price contracts shall be fully funded as soon as adequate funding becomes available.

(d) The procurement officer, with the concurrence of the installation Comptroller, may waive any of the conditions set forth in paragraphs 1832.702-70(a)-(c). The procurement officer shall maintain a record of all such approvals during the fiscal year.

(e) A class deviation from the conditions set forth in paragraphs 1832.702-70(a), (b) and (c) exists to permit incremental funding of contracts under Phase II of the Small Business Innovation Research (SBIR) Program (through September 30, 2000) and Phase II of the Small Business Technology Transfer (STTR) program (through September 30, 2001). This deviation exists with the understanding that the contracts will be fully funded when funds become available.

(a) Upon receipt of the contractor's notice under paragraph (c)(1) of the clause at 1852.232-77, Limitation of Funds (Fixed-Price Contract), the contracting officer shall promptly provide written notice to the contractor that the Government is --

(1) Allotting additional funds in a specified amount for continued performance;

(2) Terminating the contract; or

(3) Considering whether to allot additional funds; and

(i) The contractor is entitled to stop work in accordance with paragraph (b) of the clause at 1852.232-77, Limitation of Funds; and

(ii) Any costs expended beyond the amount specified in paragraph (a) of the clause at 1852.232-77, Limitation of Funds, are incurred at the contractor's risk.

(b) Upon determining that the contract will receive no further funds, the contracting officer shall promptly give notice of the Government's decision and terminate for the convenience of the Government.

(a) The contracting officer shall insert the clause at 1852.232-77, Limitation of Funds (Fixed-Price Contract), in solicitations and contracts for fixed-price incrementally funded research and development.

(b) The contracting officer shall insert a clause substantially as stated at 1852.232-81, Contract Funding, in Section B of solicitations and contracts containing the clause at FAR 52.232-22, Limitation of Funds. Insert the amounts of funds available for payment, the items covered, and the applicable period of performance. The amount obligated for fee in paragraph (b) of the clause should always be sufficient to pay fee anticipated to be earned for the work funded by the amount in paragraph (a) of the clause.

(a) Except as authorized in 1832.970, is NASA's policy to make contract financing payments on the 30th day after the designated billing office has received a proper request. However, the due date for making contract financing payments for a specific contract may be earlier than the 30th day, but not earlier than 7 days, after the designated billing office has received a proper request, provided that:

(i) The contractor provides consideration whose value is determined to be greater than the cost to the United States Treasury of interest on funds paid prior to the 30th day, calculated using the Current Value of Funds Rate published annually in the Federal Register (subject to quarterly revision);

(ii) The contracting officer approves the payment date change, with the concurrence of the installation Financial Management Officer; and

(iii) The contract file includes documentation regarding the value of the consideration and the analysis determining that value.

(c)(3) When the clause at FAR 52.232-25, Prompt Payment, is used in such contracts with the Canadian Commercial Corporation (CCC), insert "17^th" in lieu of "30^th" in paragraphs (a)(1)(i)(A), (a)(1)(i)(B), and (a)(1)(ii).

(b)(2) In determining the amount of performance-based payments, contracting officers shall ensure that the payments will not result in an unreasonably low or negative level of contractor investment. To make this assessment, contracting officers shall request the contractor to submit with its proposal a numeric and graphic funding profile showing the cash flow and contractor investment in the contract.

(a) If the contract is for launch services, the contracting officer shall delete paragraph (f) of the clause at FAR 52.232-32 in accordance with 1832.1009.

Performance-based payments shall be approved in accordance with field installation procedures.

In accordance with 42 U.S.C. 2465d, NASA shall not take title to launch vehicles under contracts for launch services unless one of the exceptions in the law applies. However, the law does not eliminate NASA's right to take title to other property acquired or produced by the contractor under a contract containing a title provision.

1832.1110 Solicitation provision and contract clauses.

(a)(1) NASA does not use the Central Contractor Registration. Use the clause at FAR 52.232-34, Payment by Electronic Funds Transfer--Other than Central Contractor Registration.

(b) In accordance with FAR 32.1106(b), the use of a nondomestic EFT mechanism is authorized. When a nondomestic EFT mechanism is used, the contracting officer shall replace the paragraph at FAR 52.232-34(c) with a description of the EFT mechanism that will be used for the contract.

(c) The payment office shall be the designated office for receipt of contractor EFT information for all NASA contracts.

 (b) The NASA Administrator is required by statute to establish annually a goal to make available to small disadvantaged business concerns, Historically Black Colleges and Universities, minority institutions, and women-owned small business concerns, at least 8 percent of NASA's procurement dollars under prime contracts or subcontracts awarded in support of authorized programs, including the space station by the time operational status is obtained.

(c) The contractor hereby agrees to assist NASA in achieving this goal by using its best efforts to award subcontracts to such entities to the fullest extent consistent with efficient contract performance.

(d) Contractors acting in good faith may rely on written representations by their subcontractors regarding their status as small disadvantaged business concerns, Historically Black Colleges and Universities, minority institutions, and women-owned small business concerns.

As prescribed in 1819.7219(a), insert the following clause:

(a) Prime contractors, including certain small businesses, are encouraged to participate in the NASA Mentor-Protégé Program for the purpose of providing developmental assistance to eligible protégé entities to enhance their capabilities and increase their participation in NASA contracts.

(b) The Program consists of:

(1) Mentor firms, which are large prime contractors with at least one active subcontracting plan or eligible small businesses;

(2) Protégés, which are subcontractors to the prime contractor, include small disadvantaged business concerns, women-owned small business concerns, Historically Black Colleges and Universities, and minority institutions meeting the qualifications specified in NASA FAR Supplement (NFS) 1819.7209.

(3) Mentor-protégé agreements, approved by the NASA Office of Small and Disadvantaged Business Utilization (OSDBU);

(4) In contracts with award fee incentives, potential for payment of additional fee for voluntary participation and successful performance in the Mentor-Protégé Program.

(c) Mentor participation in the Program, described in NFS 1819.72, means providing technical, managerial and financial assistance to aid protégés in developing requisite high-tech expertise and business systems to compete for and successfully perform NASA contracts and subcontracts.

(d) Contractors interested in participating in the pilot program are encouraged to contact the NASA OSDBU, Washington, DC 20546, (202) 358-2088, for further information.

As prescribed in 1819.7219(b), insert the following clause:

(a) The purpose of the NASA Mentor-Protégé Program is for a NASA prime contractor to provide developmental assistance to certain subcontractors qualifying as protégés. Eligible protégés include small disadvantaged business concerns, women-owned small business concerns, Historically Black Colleges and Universities, and minority institutions meeting the qualifications specified in NASA FAR Supplement (NFS) 1819.7209.

(b) NASA will evaluate the contractor's performance on the following factors. If this contract includes an award fee incentive, this assessment will be accomplished as part of the fee evaluation process.

(1) Specific actions taken by the contractor, during the evaluation period, to increase the participation of protégés as subcontractors and suppliers;

(2) Specific actions taken by the contractor during this evaluation period to develop the technical and corporate administrative expertise of a protégé as defined in the agreement;

(3) To what extent the protégé has met the developmental objectives in the agreement; and

(4) To what extent the firm's participation in the Mentor-Protégé Program resulted in the protégé receiving competitive contract(s) and subcontract(s) from private firms and agencies other than the mentor.

(c) Semi-annual reports shall be submitted by the mentor to the NASA Mentor-Protégé program manager, NASA Headquarters OSDBU, to include information as outlined in paragraph (b).

(d) The mentor will notify the OSDBU and the contracting officer, in writing, at least 30 days in advance of the mentor firm's intent to voluntarily withdraw from the program or upon receipt of a protégé's notice to withdraw from the Program;

(e) Mentor and protégé firms will submit a "lessons learned" evaluation to the NASA OSDBU at the conclusion of the contract. At the end of each year in the Mentor-Protégé Program, the mentor and protégé, as appropriate, will formally brief the NASA Mentor-Protégé program manager, the technical program manager, and the contracting officer during a formal program review regarding Program accomplishments as pertains to the approved agreement.

(f) NASA may terminate mentor-protégé agreements for good cause and exclude mentor or protégé firms from participating in the NASA program. These actions shall be approved by the NASA OSDBU. NASA shall terminate an agreement by delivering to the contractor a Notice specifying the reason for termination and the effective date. Termination of an agreement does not constitute a termination of the subcontract between the mentor and the protégé. A plan for accomplishing the subcontract effort should the agreement be terminated shall be submitted with the agreement as required in NFS 1819.7213(h).

1852.223-70 Safety and Health.

As prescribed in 1823.7001(a), insert the following clause:

(a) The Contractor shall take all reasonable safety and health measures in performing under this contract. The Contractor shall comply with all Federal, State, and local laws applicable to safety and health in effect on the date of this contract and with the safety and health standards, specifications, reporting requirements, and provisions set forth in the contract Schedule.

(b) The Contractor shall take or cause to be taken any other safety and health measures the Contracting Officer may reasonably direct. To the extent that the Contractor may be entitled to an equitable adjustment for those measures under the terms and conditions of this contract, the equitable adjustment shall be determined pursuant to the procedures of the changes clause of this