A23 - HR001125R0003 - Attachment 2 - DARPA Payment Waiver.pdf

This document is a Memorandum for Record from the Defense Advanced Research Projects Agency (DARPA) detailing alternative payment instructions for contractor payments. The memorandum, authorized under Section 233 of the National Defense Authorization Act for Fiscal Year 2017, establishes a pilot program to enhance research and development centers' operational methods.

The key change involves a new payment methodology where DARPA will use "oldest funds first" when contractor payments involve funds from different fiscal years. Specifically, the payment office will disburse funds using the oldest fiscal year appropriations first, exhausting previous years' funds before moving to newer fiscal year funds. This approach requires advance agreement between the contracting activity, contract administration office, and payment office. DARPA found that previous payment practices were inefficient and had administrative burdens that impeded the Agency's ability to manage program funding and contractual expenditures effectively.