DRAFT SIR CSS-FD Sect I.pdf

SECTION I Solicitation #

CONTRACT CLAUSES CSS-FD

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SECTION I: CONTRACT CLAUSES

I.1 AMS CLAUSES AND PROVISIONS BY REFERENCE

3.1-1 AMS Clauses and Provisions Incorporated by Reference (July 2019)

This screening information request (SIR) or contract, as applicable, incorporates by reference the provisions or clauses listed below with the same force and effect as if they were given in full text. Upon request, the Contracting Officer will make the full text available, or offerors and contractors may obtain the full text via Internet at: https://fast.faa.gov/contractclauses.cfm.

(End of clause)

Clause # Title 3.1.7-1 Exclusion from Future Agency Contracts July 2018) 3.1.7-2 Organizational Conflicts of Interest (January 2023) 3.1.7-4 Organizational Conflicts of Interest-Mitigation Plan Required (October 2019) 3.1.7-5 Disclosure of Conflicts of Interest (July 2018) 3.1.8-1 Cancellation, Rescission and Recovery of Funds for Illegal or Improper Activity

(October 2014) 3.1.8-2 Price or Fee Adjustment for Illegal or Improper Activity (October 2019) 3.2.2.3-8 Audit and Records (July 2010) 3.2.2.3-25 Price Reduction for Defective Certified Cost or Pricing Data (January 2022) 3.2.2.3-27 Subcontractor Certified Cost or Pricing Data (January 2022) 3.2.2.3-29 Integrity of Unit Prices (July 2004) 3.2.2.3-30 Termination of Defined Benefit Pension Plans (April 2023) 3.2.2.3-33 Order of Precedence (March 2009) 3.2.2.3-36 Reversing or Adjusting of Plans for Postretirement Benefits Other Than Pensions

(PRB) (April 2023) 3.2.2.3-83 Prohibition Against Contracting with Inverted Domestic Corporations (October

2015) 3.2.2.7-6 Protecting the Government's Interest when Subcontracting with Contractors

Debarred, Suspended, or Proposed for Debarment (April 2023) 3.2.2.7-8 Disclosure of Team Arrangements (April 2008) 3.2.3-2 Cost Accounting Standards (October 2019) 3.2.3-3 Disclosure and Consistency of Cost Accounting Practices (October 2019) 3.2.3-5 Administration of Cost Accounting Standards (October 2019) 3.2.4-6 Fixed Fee (October 2019) 3.2.4-27 Limitation of Price and Contractor Obligations (October 2019) 3.2.4-28 Alternate I Cancellation of Items (October 2019) 3.2.5-1 Officials Not to Benefit (April 2021) 3.2.5-3 Gratuities or Gifts (October 2019) 3.2.5-4 Contingent Fees (October 1996) 3.2.5-5 Anti-Kickback Procedures (October 2019) 3.2.5-6 Restrictions on Subcontractor Sales to the FAA (October 2022) 3.2.5-8 Whistleblower Protection for Contractor Employees (April 1996) https://fast.faa.gov/contractclauses.cfm

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3.2.5-13 Contractor Code of Business Ethics and Conduct (April 2023) 3.2.5-14 Display of Hotline Poster(s) (April 2023) 3.3.1-1 Payments (July 2018) 3.3.1-5 Payments under Time-and-Materials and Labor-Hour Contracts (October 2021) 3.3.1-7 Limitation on Withholding of Payments (July 2018) 3.3.1-8 Extras (July 2018) 3.3.1-10 Availability of Funds (April 2014) 3.3.1-12 Limitation of Cost (July 2018) 3.3.1-14 Limitation of Funds (July 2018) 3.3.1-15 Assignment of Claims (July 2018) 3.3.1-17 Prompt Payment (January 2021) 3.3.1-20 Providing Accelerated Payment to Small Business Subcontractors (October 2012) 3.3.1-34 Payment by Electronic Funds Transfer- System for Award Management (July

2018) 3.3.1-39 Funding - Time-and-Materials and Labor-Hour Contracts (July 2018) 3.3.2-1 FAA Cost Principles (October 2019) 3.3.2-2 Reimbursement for Travel and Subsistence (April 2010) 3.4.1-11 Insurance - Liability to Third Persons (October 2019) 3.4.1-12 Insurance (October 2019) 3.4.1-13 Errors and Omissions (July 1996) 3.4.2-6 Taxes - Contracts Performed in U.S. Possessions or Puerto Rico (October 1996) 3.4.2-8 Federal, State, and Local Taxes - Fixed Price Contract (July 2019) 3.5-1 Authorization and Consent (April 2023)

3.5.2 Notice and Assistance Regarding Patent and Copyright Infringement (January

2009) 3.5-13 Rights in Data – General (October 2014) 3.6.1-3 Utilization of Small, Small Disadvantaged, Women-Owned, Service-Disabled

Veteran Owned, and HUBZone Small Business Concerns (January 2021) 3.6.1-4 Small Business Subcontracting Plan (October 2022) 3.6.1-5 Payment to Small Business Subcontractors (October 2022) 3.6.1-6 Liquidated Damages - Subcontracting Plan (October 2022) 3.6.1-9 Mentor Protégé Program (July 2022) 3.6.1-11 Mentor-Protégé Requirements and Evaluation (January 2021) 3.6.1-15 Post-Award Small Business Program Re-representation (July 2023) 3.6.2-2 Convict Labor (April 1996) 3.6.2-9 Equal Opportunity (July 2023) 3.6.2-10 Equal Opportunity Pre-award Clearance of Subcontracts (January 2020) 3.6.2-12 Equal Opportunity for Veterans (April 2022) 3.6.2-13 Equal Opportunity for Workers with Disabilities (April 2022) 3.6.2-35 Prevention of Sexual Harassment (July 2023) 3.6.2-39 Trafficking in Persons (April 2019) 3.6.2-44 Notification of Employee Rights Under the National Labor Relations Act

(January 2019) 3.6.3-14 Use of Environmentally Preferable Products (January 2020) 3.6.3-23 Delivery of Electronic and Paper Documents (January 2020) 3.6.4-10 Restrictions on Certain Foreign Purchases (January 2010)

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3.6.4-21 Export Control (July 2014) 3.6.4-23 Prohibition on Contracting for Certain Telecommunications and Video

Surveillance Services or Equipment (April 2022) 3.6.5-1 Utilization of Indian Organizations and Indian Owned Economic Enterprises

(January 2023) 3.6.6-1 Drug Free Workplace (April 2023) 3.6.6-2 Seat Belt Use by Contractor Employees (April 2023) 3.6.6-3 Contractor Policy to Ban Text Messaging While Driving (July 2023) 3.8.2-10 Protection of Government Buildings, Equipment, and Vegetation (July 2019) 3.8.2-11 Continuity of Services (October 2018) 3.8.2-19 Prohibition on Advertising (July 2019) 3.8.9-2 Prohibition on Contracting for Certain Telecommunications and Video

Surveillance Services or Equipment (July 2023) 3.9.1-2 Protest After Award (August 1997) 3.10.1-1 Notice of Intent to Disallow Costs (April 1996) 3.10.1-3 Penalties for Unallowable Costs (October 1996 3.10.1-7 Bankruptcy (April 1996) 3.10.1-12Alt1 Changes - Fixed-Price (April 1996) 3.10.1-13Alt1 Changes - Cost-Reimbursement (April 1996) 3.10.1-14 Changes - Time and Materials or Labor Hours (April 1996) 3.10.1-25 Novation and Change-Of-Name Agreements (October 2007) 3.10.1-26 Contractor Performance Assessment Reporting System (April 2021) 3.10.1-28 Changes Required by Law (Oct 2023) 3.10.2-3 Subcontracts (Time-and-Materials and Labor-Hour Contracts) (April 1996) 3.10.2-6 Subcontracts for Commercial Items and Commercial Components (April 1996) 3.10.3-2 Government Property-Basic Clause (April 2022) 3.10.3-5 Use and Charges (October 2018) 3.10.4-19 Government Industry Data Exchange Program (GIDEP) (January 2018) 3.10.4-26 Technical Data Quality Requirement for NAS Procurements (January 2004) 3.10.6-1 Termination for Convenience of the Government (Fixed Price) (October 1996) 3.10.6-3 Termination (Cost-Reimbursement) (January 2020) 3.10.6-3 Alternate IV Termination (Cost-Reimbursement) (January 2015) 3.10.6-4 Default (Fixed-Price Supply and Service) (January 2020) 3.10.6-7 Excusable Delays (October 1996)

3.13.10 Contractor Attendance at FAA Sponsored Training

3.13-11 Plain Language (July 2006) 3.13-14 Reporting Executive Compensation and First-Tier Subcontract Awards (October

2023) 3.14-5 Sensitive Unclassified Information (SUI) (January 2022) 3.14-6 Privacy or Security Safeguards (November 2016)

I.2 AMS CLAUSE AND PROVISIONS BY FULL TEXT

1.13-1 Notice of Earned Value Management System (July 2016)

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The offeror's (you/your) response to this screening information request (SIR) must include proof of a certified EVMS or provide a plan (the plan) to implement a certified system that complies with the EVMS criteria (the criteria) stated in subparagraph (b) of clause 1.13-2, "EVMS." You must submit the following as part of your proposal for Contracting Officer (CO) approval:

(a) Documentation demonstrating that your EVMS has been Electronic Industries Alliance Standard 748(EIA-748) certified and EVM surveillance documentation demonstrating that you have maintained an EIA-748 compliant EVMS at the time this SIR is issued; or

(b) The plan that explains how your EVMS will be certified for each guideline of the EIA-748 Standard.

(c) Names of subcontractors. If you have not yet identified subcontractors, you must identify any part of the work you intend to award to subcontractors. The CO must approve the subcontractors before you sign contracts with them.

(End of provision)

1.13-2 Earned Value Management System (July 2016)

(a) The Earned Value Management System (EVMS) is a management tool that provides for integrating technical, cost and schedule information about contract performance. This information enables the FAA (we) and contractor program managers to manage contracts more effectively. EIA -748 specifies the EVMS criteria that are incorporated by reference into this clause.

(b) The Contractor (you/your) must use an EVMS complying with the current version of EIA- 748 that the FAA Contracting Officer (CO) or the contracting officer from another federal agency certified before contract award. If you do not have a certified EVMS in place at the time of award, you must provide the CO with your plan to create an EVMS that complies with EIA- 748 before award and implement the system within 90 days after award.

(c) Approved subcontractor EVM plans:

(1) The CO must approve subcontractor EVMS plans before they begin work. The CO has approved the following subcontractor EVMS systems.

[CO to insert name of approved subcontractor and EVMS plan here] [CO to insert name of approved subcontractor and EVMS plan here]

(2) You must require subcontractors listed in the contract and subject to EVMS certification to comply with this clause, paragraphs (a) and (b).

(d) You must submit an Integrated Program Management Report (IPMR) prepared under [Contracting Officer to insert reference to location of the applicable DID DI-MGMT-81861 that

I - 5 specifies the contract's reporting requirements. The CO may request customized earned value management reports but at a minimum contractors must submit DID Formats 1, 3 , 5, 6 and 7].

(e) You must obtain approval for EVMS system revisions consistent with the EVM system change process approved with the EVM certification or similar agreement, i.e., EVM Advance Agreement, with the controlling certification approval or acceptance party.

(f) You must participate in FAA EVM Surveillance and provide access to all pertinent records and data requested by the CO so the we can verify that your EVMS complies with the criteria specified in subparagraph (b) at the time of award and throughout contract performance consistent with the FAA EVMS Surveillance Guide.

(End of clause)

1.13-5 Integrated Master Schedule (October 2019)

(a) Offerors must submit an Integrated Master Schedule (IMS) report prepared in accordance with DID CSS-FD-PM04, Integrated Master Schedule (IMS).

(b) Offerors must manage the execution of the CSS-FD program using the IMS as a day-to-day execution tool and periodically assess program progress in meeting program requirements.

Offerors must report on program progress consistent with the IMS at each program management review, at selected technical reviews and at other times at the Government's request.

(c) Offerors must revise the IMS, where necessary, to reflect current contract milestones and deliverables. The IMS will include all activities of the prime contractor, subcontractors, and dependencies on the Government. All contractor schedule information delivered to the Government or presented at program reviews must originate from the IMS. You must perform appropriate analyses of the IMS tasks and report potential or existing problem areas and recommend corrective actions to eliminate or reduce schedule impact to the program.

(End of clause)

1.13-6 Contractor Integrated Baseline Review (July 2016)

(a) The Contractor (you) must participate in a Government-conducted Integrated Baseline Review (IBR) with acceptable action plans approved by the Contracting Officer within 120 days after contract award and after executing major contract modifications.

(b) The IBR will be conducted consistent with the FAA Integrated Baseline Review (IBR) Guide.

(End of clause)

1.13-7 Earned Value Management System - Withholding of Payment (October 2019)

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(a)Definition

"Significant Deficiency" means a shortcoming that affects the ability of the FAA to rely on information provided by the Earned Value Management System (EVMS) that is needed for management purposes

(b) General. The Contractor must establish and maintain an acceptable EVMS in accordance with the terms and conditions of this contract.

(c) Significant Deficiencies.

(1) The contractor must respond, in writing, within 30 days to an initial determination that there are one or more significant deficiencies in the Contractor's EVMS.

(2) The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the final determination whether the Contractor's EVMS contains significant deficiencies. If the Contracting Officer determines that the Contractor's EVMS contains significant deficiencies, the final determination will include a notice to withhold payments.

(d) Withholding Payments

(1)If the Contracting Officer issues the final determination with a notice to withhold payments for significant deficiencies in the Contractor's EVMS as required under this contract, the Contracting Officer will withhold five percent of amounts due from a progress payments and performance-based payments, and direct the Contractor, in writing, to withhold five percent from its billings on interim cost vouchers on cost, labor-hour, and time-and-materials contractors until the Contracting Officer has determined that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination. The Contractor must, within 45 days of receipt of the notice, either correct the deficiencies or submit an acceptable corrective action plan showing the milestones and actions to eliminate the deficiencies.

(2) If the Contractor submits an acceptable corrective action plan within 45 days of receipt of a notice of the Contracting Officer's intent to withhold payments, and the Contracting Officer, in consultation with the auditor or functional specialist, determines that the Contractor is effectively implementing such plan, the Contracting Officer will reduce withholding directly related to the significant deficiencies covered under the corrective action plan, to two percent from progress payments and performance-based payments, and direct the Contractor, in writing, to reduce the percentage withheld on interim cost vouchers to two percent until the Contracting Officer determines the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination. However, if at any time, the Contracting Officer determines that the Contractor has failed to follow the accepted corrective action plan, the Contracting Officer will increase withholding from progress payments and performance-based payments, and direct the Contractor, in writing, to increase the percentage withheld on interim cost vouchers to the percentage initially withheld, until the Contracting Officer determines that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination.

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(3) Payment withhold percentage limits

(i)The total percentage of payments with held on amounts due under each progress payment, performance-based payment, or interim cost voucher, must not exceed five percent for one or more significant deficiencies in the Contractor's EVMS

(ii) If this contract contains pre-existing withholds due to significant deficiencies in the Contractor's EVMS, and the application of any subsequent payment withholds will cause withholding under this clause to exceed the payment withhold percentage limits in paragraph (d)

(3) (i) of this clause, the Contracting Officer will reduce the payment withhold percentage in the final determination to an amount that will not exceed the payment withhold percentage limits.

(4) For the purpose of this clause, payment means any of the following payments authorized under this contract:

(i) Interim payments under-

(A) Cost-reimbursement contracts;

(B) Incentive-type contracts;

(C) Time-and-materials contracts;

(D) Labor-hour contracts

(ii) Progress payments.

(iii) Performance-based payments.

(5) Payment withholding will not apply on fixed-price line items where performance is complete and the items were accepted by the FAA.

(6) The withholding of any amount or subsequent payment to the Contractor will not be construed as a waiver of any rights or remedies that the FAA has under this contract.

(7) Notwithstanding the provisions of any clause in the contract providing for interim, partial, or other payment withholding on any basis, the Contracting Officer may withhold payment in accordance with the provisions of this clause.

(8) The payment withholding authorized in this clause is not subject to the interest-penalty provisions of the Prompt Payment Act.

(e) Correction of deficiencies

(1) The Contractor must notify the Contracting Officer, in writing, when the Contractor has corrected the deficiencies of the EVMS.

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(2) Once the Contractor has notified the Contracting Officer that all deficiencies have been corrected, the Contracting Officer will take one of the following actions:

(i) If the Contracting Officer determines that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination, the Contracting Officer will, as appropriate, discontinue the withholding of progress payments and performance-based payments, and direct the Contractor, in writing, to discontinue the payment withholding from billings on interim cost vouchers under this contract associated with the Contracting Officer's final determination, and authorize the Contractor to bill for any monies previously withheld that are not also being withheld due to other significant deficiencies. Any payment withholding under this contract due to other significant deficiencies will remain in effect until the Contracting Officer determines that those significant deficiencies are corrected.

(ii) If the Contracting Officer determines that the Contractor still has significant deficiencies, the Contracting Officer will continue the withholding of progress payments and performance-based payments, and the contractor must continue withholding amounts from its billings on interim cost vouchers in accordance with paragraph (d) of this clause, and not bill for any monies previously withheld.

(iii) If, within 90 days of receipt of the Contractor notification that the Contractor has corrected the significant deficiencies, the Contracting Officer has not made a determination whether the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination, or has not made a determination whether there is a reasonable expectation that the corrective actions have been implemented, the Contracting Officer will reduce withholding directly related to the significant deficiencies covered under the corrective action plan by at least 50 percent of the amount being withheld from progress payments and performance-based payments, and direct the Contractor, in writing, to reduce the percentage withheld on interim cost vouchers by at least 50 percent, until the Contracting Officer makes a determination whether the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination, or has made a determination whether there is a reasonable expectation that corrective actions have been implemented.

(iv) At any time after the Contracting officer reduces or discontinues the withholding of progress payments and performance-based payments, or directs the Contractor to reduce or discontinue the payment withholding from billings on interim cost vouchers under this contract, if the Contracting Officer determines that the Contractor has failed to correct the significant deficiencies identified in the Contractor's notification, the Contracting Officer will reinstate or increase withholding from progress payments and performance-based payments, and direct the Contractor, in writing, to reinstate or increase the percentage withheld on interim cost vouchers to the percentage initially withheld, until the Contracting Officer determines that the Contractor has corrected all significant deficiencies as directed by the Contracting Officer's final determination.

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3.1.7-6 Disclosure of Certain Employee Relationships (April 2023)

(a) The policy of the FAA is to avoid doing business with contractors, subcontractors, and consultants who have a conflict of interest or an appearance of a conflict of interest. The purpose of this policy is to maintain the highest level of integrity within its workforce and to ensure that the award of procurement contracts is based upon fairness and merit.

(b) The contractor must provide to the Contracting Officer the following information with its proposal and must provide an information update within 30 days of the award of a contract, any subcontract, or any consultant agreement, or within 30 days of the retention of a Subject Individual or former FAA employee subject to this clause:

(1) The names of all Subject Individuals who:

(i) participated in preparation of proposals for award; or

(ii) are planned to be used during performance; or

(iii) are used during performance; and

(2) The name of each individual, retained in any capacity by the contractor, who was employed by FAA during the five-year period immediately prior to the date of award; and

(3) The date on which the initial expression of interest in a future financial arrangement was discussed with the contractor by any former FAA employee whose name is required to be provided by the contractor pursuant to subparagraph (2); and

(4) The location where any Subject Individual or former FAA employee whose name is required to be provided by the contractor pursuant to subparagraphs (1) and (2), are expected to be assigned.

(c) "Subject Individual" means a current FAA employee's father, mother, son, daughter, brother, sister, uncle, aunt, first cousin, nephew, niece, husband, wife, father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in-law, stepfather, stepmother, stepson, stepdaughter, stepbrother, stepsister, half brother, half sister, spouse of an in-law, or a member of his/her household.

(d) The contractor must incorporate this clause into all subcontracts or consultant agreements awarded under this contract and must further require that each such subcontractor or consultant incorporate this clause into all subcontracts or consultant agreements at any tier awarded under this contract unless the Contracting Officer determines otherwise.

(e) The information as it is submitted, must be certified as being true and correct. If there is no such information, the certification must so state.

(f) Remedies for nondisclosure: The following are possible remedies available to the FAA should a contractor misrepresent or refuse to disclose or misrepresent any information required by this clause:

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(1) Termination of the contract.

(2) Exclusion from subsequent FAA contracts.

(3) Other remedial action as may be permitted or provided by law or regulation or policy or by the terms of the contract.

(g) Annual Certification. The contractor must provide annually, based on the anniversary date of contract award, the following certification in writing to the Contracting Officer:

ANNUAL CERTIFICATION OF DISCLOSURE OF CERTAIN EMPLOYEE

RELATIONSHIPS

The contractor represents and certifies that to the best of its knowledge and belief that during the prior 12 month period:

[ ] A former FAA employee(s) or Subject Individual(s) has been retained to work under the contract or subcontract or consultant agreement and complete disclosure has been made in accordance with subparagraph (b) of AMS Clause 3.1.7-6.

[ ] No former FAA employee(s) or Subject Individual(s) has been retained to work under the contract or subcontract or consultant agreement, and disclosure required by AMS Clause 3.1.7-6 is not applicable.

Authorized Representative Company Name Date

(h) The contractor agrees to include the substance of this clause in all subcontracts awarded under this contract. The Contracting Officer will consider case-by-case exceptions to this requirement for individual subcontracts in the event that: (1) the contractor considers this clause to be inappropriate and unnecessary in the case of a particular subcontract; (2) the contractor provides a written statement affirming absolute unwillingness of a subcontractor to perform, absent some relief from the substance of this prohibition and the reason why; (3) use of an alternate subcontract source would unreasonably detract from the quality of effort; and (4) the contractor provides the Contracting Officer timely written advance notice of these and any other extenuating circumstances.

3.2.1.5-4 Continuity of Services - Mission Critical Contracts (January 2008)

(a) The contractor recognizes that the supplies and/or services under this contract are critical to FAA and must be continued without interruption during times of National Emergency or

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Incidents of National Significance. Supplies and/or services to be continued without interruption are:

[Description to be entered by Contracting Officer]

(b) National Emergencies or Incidents of National Significance include:

(1) Outbreak of pandemic influenza or infectious disease;

(2) Terrorist attack; and

(3) Natural disaster.

(c) Because the supplies and/or services under this SIR or contract are deemed critical by FAA, the contractor must make every reasonable effort to deliver these supplies and/or services per the contract requirements during times of National Emergency or Incidents of National Significance;

however, the presence of this clause does not affect or diminish the Contractor's rights under Default or Termination clauses incorporated into this SIR or contract.

(d) Within [Number of days to be entered by Contracting Officer] days after award, the contractor must submit a Continuity of Contract Performance Plan to the Contracting Officer (CO) for review and acceptance. This plan describes the processes and tools that the contractor will commit to ensure supplies and/or services are delivered as required during times of National Emergency or Incidents of National Significance. This plan must include the following sections:

(1) Plans and Procedures: Detail the plans and procedures in place that will provide for continued contract performance for supplies and/or services during times of National Emergencies or Incidents of National Significance;

(2) Essential Functions: Record functions that are essential to the continuation of mission critical contract performance;

(3) Delegations of Authority, Planned Order of Succession, and Cross-Training: Procedures in place to ensure personnel are available to make key decisions and perform critical services when primary personnel are unavailable;

(4) Alternate Operating Facilities: When the primary facility is unavailable, detail plans to make available other facilities unaffected by the National Emergency or Incident of National Significance. If contract performance allows, this may include alternatives such as telecommute;

(5) Interoperable and Effective Communications: Identify alternate communication systems if primary systems are unavailable;

(6) Critical Records or Data: Identify plans in place to ensure critical records and data are still available to ensure the integrity of contract performance;

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(7) Protection of Human Capital: Identify comprehensive plans to protect the overall health and welfare of the workforce in times of National Emergency or Incidents of National Significance;

(8) Testing and Training of the Plan: Detail comprehensive testing and training of the plan to improve the execution of contract performance in times of National Emergency or Incidents of National Significance;

(9) Devolution of Control and Direction: Identify plans and the ability to transfer authority and responsibility of essential functions from the primary location to other sites and employees; and

(10) Reconstitution and Resuming Normal Operations: Identify procedures and processes to expedite the return of contract performance and operations to their normal state.

(e) The Continuity of Contract Performance Plan must be made available by the contractor to all authorized contractor personnel with a "need-to-know" for review and use during the term of the contract.

(f) The Continuity of Contract Performance Plan must be updated as needed.

(End of Clause)

3.2.2.3-37 Notification of Ownership Changes (April 2023)

(a) The Contractor must notify FAA in writing within 30 days when the Contractor becomes aware that a change in ownership has occurred or will occur and that the change could affect the value of the Contractor’s capitalized assets in the accounting records, asset valuations, or cause any other cost changes.

(b) The Contractor must:

(1) Maintain current, accurate, and complete inventory records of assets and their costs;

(2) Provide the Contracting Officer (CO) access to the records on request;

(3) Ensure that all individual and grouped assets, their capitalized values, accumulated depreciation or amortization, and remaining useful lives are identified accurately before and after each of the Contractor’s ownership changes; and

(4) Retain and maintain depreciation and amortization schedules based on the asset records maintained before each ownership change.

(c) The substance of this clause must be included in all subcontracts under this contract.

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3.2.2.3-39 Requirements for Certified Cost or Pricing Data or Data Other Than Certified Cost or Pricing Data - Modifications (Jan 2022)

(a) Request for exception from certified cost or pricing data requirements.

(1) In lieu of submitting certified cost or pricing data for modifications under this contract, on the date of the agreement on price or the date of the award, whichever is later, the Contractor may submit a written request for exception by submitting the information described in paragraphs (a)(1)(i) and (ii) of this clause. The Contracting Officer may require additional supporting information, but only to the extent necessary to determine whether an exception should be granted, and whether the price is fair and reasonable.

(i) Identification of the law or regulation establishing the price offered. If the price is controlled under law by periodic rulings, reviews, or similar actions of a governmental body, attach a copy of the controlling document, unless it was previously submitted to the contracting office.

(ii) Information on modifications of contracts or subcontracts for commercial items.

(A) If—

(1) The original contract or subcontract was granted an exception from certified cost or pricing data requirements because the price agreed upon was based on adequate price competition or prices set by law or regulation, or was a contract or subcontract for the acquisition of a commercial item; and

(2) The modification (to the contract or subcontract) is not exempted based on one of these exceptions, then the Contractor may provide information to establish that the modification would not change the contract or subcontract from a contract or subcontract for the acquisition of a commercial item to a contract or subcontract for the acquisition of an item other than a commercial item.

(B) For a commercial item exception, the Contractor must provide, at a minimum, information on prices at which the same item or similar items have previously been sold that is adequate for evaluating the reasonableness of the price of the modification.

Dependent upon the commercial items being catalog items, market-priced items, or items included on an active Federal Supply Service Multiple Award Schedule contract, the Contractor must include the corresponding information pursuant to that of which is described in paragraphs (a)(1)(B)(1); (a)(1)(B)(2) or (a)(1)(B)(3) of this clause:

(1) For catalog items, a copy of or identification of the catalog and its date, or the appropriate pages for the offered items, or a statement that the catalog is on file in the buying office to which the proposal is being submitted. Provide a copy or describe current discount policies and price lists (published or unpublished), e.g., wholesale, original equipment manufacturer, or reseller. Also explain the basis of each offered price and its relationship to the established catalog price, including how the proposed price relates to the price of recent sales in quantities similar to the proposed quantities.

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(2) For market-priced items, the source and date or period of the market quotation or other basis for market price, the base amount, and applicable discounts. In addition, describe the nature of the market.

(3) For items included on an active Federal Supply Service Multiple Award Schedule contract, proof that an exception has been granted for the schedule item.

(2) The Contractor grants the Contracting Officer or an authorized representative the right to examine, at any time before award, books, records, documents, or other directly pertinent records to verify any request for an exception under this clause, and the reasonableness of price. For items priced using catalog or market prices, or law or regulation, access does not extend to cost or profit information or other data relevant solely to the Contractor’s determination of the prices to be offered in the catalog or marketplace.

(b) Requirements for certified cost or pricing data.

If the offeror is not granted an exception from the requirement to submit certified cost or pricing data, the following applies:

(1) The offeror must prepare and submit certified cost or pricing data, data other than certified cost or pricing data, and supporting attachments in accordance with the information contained at AMS Guidance T3.2.3.G.1 “Instructions for Submitting Certified Cost/Price Proposals for Supplies, Services, or Construction,” which is incorporated by reference with the same force and effect as though it were inserted here in full text. The instructions in AMS T3.2.3.G.1 are incorporated as a mandatory format to be used in this contract.

(2) As soon as practicable after agreement on price, but before contract award (except for unpriced actions such as letter contracts), the offeror must submit a Certificate of Current Cost or Pricing Data that conforms to the instructions contained in the Appendix G1 to AMS Guidance T3.2.3, ‘Cost and Price Methodology."

3.2.4-5 Allowable Cost and Payment (October 2019)

(a) Invoicing. The Government will make payments to the Contractor when requested as work progresses, but (except for small business concerns) not more often than once every 2 weeks, in amounts determined to be allowable by the Contracting Officer in accordance with the Federal Aviation Administration's (FAA) "Contract Cost Principles" in effect on the date of this contract and the terms of this contract (upon request, the Contracting Officer will provide a copy of the FAA Contract Cost Principles). The Contractor may submit to an authorized representative of the Contracting Officer, in such form and reasonable detail as the representative may require, an invoice or voucher supported by a statement of the claimed allowable cost for performing this contract. Any payments for costs under this contract, particularly for costs of Indirect Rates under paragraph (d), must be subject to the provisions of the "Limitation of Costs" clause, or the "Limitation of Funds" clause, if applicable. The Contractor must be responsible to manage and control the allowable cost of performance of the contract, such that payments for any allowable costs, including Indirect Rates under paragraph (d), must not exceed the estimated cost set forth

I - 15 in the schedule, or the funded amount, less an allowance for fee, if the contract is incrementally funded.

(b) Reimbursing costs.

(1) For the purpose of reimbursing allowable costs (except as provided in subparagraph (2) below, with respect to pension, deferred profit sharing, and employee stock ownership plan contributions), the term costs includes only:

(i) Those costs the Contractor has incurred and recorded at the time of the request for reimbursement;

(ii) When the Contractor is not delinquent in paying costs of contract performance in the ordinary course of business, costs incurred, but not necessarily paid for-

(A) Materials issued from the Contractor's inventory and placed in the production process for use on the contract;

(B) Direct labor;

(C) Direct travel;

(D) Other direct in-house costs; and

(E) Properly allocable and allowable indirect costs, as shown in the records maintained by the Contractor for purposes of obtaining reimbursement under FAA contracts; and

(iii) The amount of payments that have been paid to the Contractor's subcontractors under similar cost standards.

(2) Contractor contributions to any pension or other post-retirement benefit, profit-sharing or employee stock ownership plan funds that are paid quarterly or more often may be included in indirect costs for payment purposes: Provided, that the Contractor pays the contribution to the fund within 30 days after the close of the period covered. Payments made 31 days or more after the close of a period must not be included until the Contractor actually makes the payment. Accrued costs for such contributions that are paid less often than quarterly must be excluded from indirect costs for payment purposes until the Contractor actually makes the payment.

(3) Notwithstanding the audit and adjustment of invoices or vouchers under paragraph (g) below, allowable indirect costs under this contract must be obtained by applying indirect cost rates established in accordance with paragraph (d) below.

(4) Any statements in specifications or other documents incorporated in this contract by reference designating performance of services or furnishing of materials at the Contractor's

I - 16 expense or at no cost to the Government will be disregarded for purposes of cost-reimbursement under this clause.

(c) Small business concerns. A small business concern may be paid more often than every 2 weeks and may invoice and be paid for recorded costs for items or services purchased directly for the contract, even though the concern has not yet paid for those items or services.

(d) Final indirect cost rates.

(1) Final annual indirect cost rates and the appropriate bases must be established for the period covered by the indirect cost rate proposal.

(2) The Contractor must, within 180 days after the expiration of each of its fiscal years, or by a later date approved by the Contracting Officer, submit to the cognizant Contracting Officer and to the cognizant audit activity proposed certified final indirect cost rates for that period and supporting cost data specifying the contract and/or subcontract to which the rates apply. The proposed rates must be based on the Contractor's actual cost experience for that period. The appropriate Government representative and Contractor will establish the final indirect cost rates as promptly as practical after receipt of the Contractor's proposal.

(i) An adequate indirect cost rate proposal must include the following data unless otherwise specified by the cognizant Contracting Officer:

(A) Summary of all claimed indirect expense rates, including pool, base, and calculated indirect rate.

(B) General and Administrative expenses (final indirect cost pool). Schedule of claimed expenses by element of cost as identified in accounting records (Chart of Accounts).

(C) Overhead expenses (final indirect cost pool). Schedule claimed expenses by element of cost as identified in accounting records (Chart of Accounts) for each final indirect cost pool.

(D) Occupancy expenses (intermediate indirect cost pool). Schedule of claimed expenses by element of cost as identified in accounting records (Charts of Accounts) and expense reallocation to final indirect cost pools.

(E) Claimed allocation bases, by element of cost, used to distribute indirect costs.

(F) Facilities capital cost of money factors computation.

(G) Reconciliation of books of account (i.e., General Ledger) and claimed direct costs by major cost elements.

(H) Schedule of direct costs by contract and subcontract and indirect expense applied at claimed rates, as well as a subsidiary schedule of Government participation percentages in each of the allocation base amounts.

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(I) Schedule of cumulative direct and indirect costs claimed and billed by contract and subcontract.

(J) Subcontract information. Listing of subcontracts awarded to companies for which the contractor is the prime or upper-tier contractor (include prime and subcontract numbers;

subcontract value and award type; amount claimed during the fiscal year; and the subcontractor name, address, and point of contract information).

(K) Summary of each time-and-materials and labor-hour contract information, including labor categories, labor rates, hours, and amounts; direct materials; other direct costs; and, indirect expense applied at claimed rates.

(L) Reconciliation of total payroll per IRS form 941 to total labor costs distribution.

(M) Listing of decisions/agreements/approvals and description of accounting/organizational changes.

(N) Certificate of final indirect cost.

(O) Contract closing information for contracts physically completed in this fiscal year (include contract number, period of performance, contract ceiling amounts, contract fee computations, level of effort, and indicate if the contract is ready to close).

(3) The Contractor and the appropriate Government representative will execute a written understanding setting forth the final indirect cost rates. The understanding will specify (i) the agreed-upon final annual indirect cost rates, (ii) the bases to which the rates apply, (iii) the periods for which the rates apply, (iv) any specific indirect cost items treated as direct costs in the settlement, and (v) the affected contract and/or subcontract, identifying any with advance agreements or special terms and the applicable rates. The understanding will not change any monetary ceiling, contract obligation, or specific cost allowance or disallowance provided for in this contract. The understanding is incorporated into this contract upon execution.

(4) After final annual direct cost rates are established for specific period, the contractor must update the billings on all contracts to reflect the final settled rates and update the schedule of cumulative direct and indirect costs claimed and billed as required by paragraph d(2)(i)(l) of this clause.

(5) Failure by the parties to agree on a final annual indirect cost rate may be the basis of a claim under the "Contract Disputes" clause.

(e) Billing rates. Until final annual indirect cost rates are established for any period, the Government will reimburse the Contractor at billing rates established by the Contracting Officer or by an authorized representative (the cognizant auditor), subject to adjustment when the final rates are established. These billing rates-

(1) Must be the anticipated final rates; and

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(2) May be prospectively or retroactively revised by mutual agreement, at either party's request, to prevent substantial overpayment or underpayment.

(f) Quick-close-out procedures. When the Contractor and Contracting Officer agree, the quick-close-out procedures may be used.

(1) Procedures. Settlement of indirect cost rates must apply to this contract, in advance of the determination of final indirect cost rates, if:

(i) The contract is physically complete;

(ii) The amount of unsettled indirect cost to be allocated to this contract is not more than $5,000,000 and the cumulative unsettled indirect costs to be allocated to one or more contracts in a single fiscal year do not exceed 15 percent of the estimated, total unsettled indirect costs allocable to cost-type contracts for that fiscal year; and

(iii) Agreement can be reached on a reasonable estimate of allocable dollars.

(2) The settlement must be final for this contract and no adjustment will be made to other contracts for over- or under-recoveries of costs allocated or allocable to this contract.

(3) The settlement will not be considered a binding precedent when establishing the final indirect costs for other contracts.

(4) These procedures may also be used for the settlement of direct and indirect costs for individual task and delivery orders.

(g) Audit. At any time or times before final payment, the Contracting Officer may have the Contractor's invoices or vouchers and statements of cost audited. Any payment may be (1) reduced by amounts found by the Contracting Officer not to constitute allowable costs or (2) adjusted for prior overpayments or underpayments.

(h) Final payment.

(1) The Contractor must submit a completion invoice or voucher, designated as such, promptly upon completion of the work, but no later than 120 days (or longer, as the Contracting Officer may approve in writing) after settlement of final annual indirect rates for all years. Upon approval of that invoice or voucher, and upon the Contractor's compliance with all terms of this contract, the Government will promptly pay any balance of allowable costs and that part of the fee (if any) not previously paid.

(2) The Contractor must pay to the Government any refunds, rebates, credits, or other amounts (including interest, if any) accruing to or received by the Contractor or any assignee under this contract, to the extent that those amounts are properly allocable to costs for which the Contractor has been reimbursed by the Government. Reasonable expenses incurred by the Contractor for securing refunds, rebates, credits, or other amounts will be allowable costs if approved by the

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Contracting Officer. Before final payment under this contract, the Contractor and each assignee whose assignment is in effect at the time of final payment must execute and deliver-

(i) An assignment to the Government, in form and substance satisfactory to the Contracting Officer, of refunds, rebates, credits, or other amounts (including interest, if any) properly allocable to costs for which the Contractor has been reimbursed by the Government under this contract; and

(ii) A release discharging the Government, its officers, agents, and employees from all liabilities, obligations, and claims arising out of or under this contract, except-

(A) Specified claims stated in exact amounts, or in estimated amounts when the exact amounts are not known;

(B) Claims (including reasonable incidental expenses) based upon liabilities of the Contractor to third parties arising out of the performance of this contract; provided, that the claims are not known to the Contractor on the date of the execution of the release, and that the Contractor gives notice of the claims in writing to the Contracting Officer within 6 years following the release date or notice of final payment date, whichever is earlier; and

(C) Claims for reimbursement of costs, including reasonable incidental expenses, incurred by the Contractor under the patent clauses of this contract, excluding, however, any expenses arising from the Contractor's indemnification of the Government against patent liability.

3.2.4-8 Incentive Fee (October 2019)

(a) General. The FAA will pay the Contractor for performing this contract a fee determined as provided in this contract.

(b) Target cost and target fee. The target cost and target fee specified in the "Schedule" are subject to adjustment if the contract is modified in accordance with paragraph (d) below.

(1) Target cost, as used in this contract, means the estimated cost of this contract as initially negotiated, adjusted in accordance with paragraph (d) below.

(2) Target fee, as used in this contract, means the fee initially negotiated on the assumption that this contract would be performed for a cost equal to the estimated cost initially negotiated, adjusted in accordance with paragraph (d) below.

(c) Withholding of payment. Normally, the FAA will pay the fee to the Contractor as specified in the Schedule. However, when the Contracting Officer considers that performance or cost indicates that the Contractor will not achieve target, the FAA will pay on the basis of an appropriate lesser fee. When the Contractor demonstrates that performance or cost clearly

I - 20 indicates that the Contractor will earn a fee significantly above the target fee, the Government may, at the sole discretion of the Contracting Officer, pay on the basis of an appropriate higher fee. After payment of 85 percent of the applicable fee, the Contracting Officer may withhold further payment of fee until a reserve is set aside in an amount that the Contracting Officer considers necessary to protect the FAA's interest. This reserve must not exceed 15 percent of the applicable fee or $100,000, whichever is less.

(d) Equitable adjustments. When the work under this contract is increased or decreased by a modification to this contract or when any equitable adjustment in the target cost is authorized under any other clause, equitable adjustments in the target cost, target fee, minimum fee, and maximum fee, as appropriate, must be stated in a supplemental agreement to this contract.

(e) Fee payable.

(1) The fee payable under this contract must be the target fee increased by ___________ [Contracting Officer insert Contractor's participation] cents for every dollar that the total allowable cost is less than the target cost or decreased by ___________ [Contracting Officer insert Contractor's participation] cents for every dollar that the total allowable cost…