EDS RFP 70T04023R7672N002.docx

Transportation Security Administration

Explosive Detection System (EDS) Performance Based Logistics (PBL)

Request for Proposal 70T04023R7672N002

Table of contents

- Schedule of Supplies/Services

General Description This contract shall provide Explosive Detection System (EDS) Performance Based Logistics (PBL) services as described in Part C, Performance Work Statement (PWS), in accordance with the pricing set forth in Part A, Schedule of Supplies/Services.

Contract Type This contract utilizes Firm Fixed Price (FFP), Fixed Unit Price (FUP), and Time and Materials (T&M) Contract Line Item Numbers (CLINs).

Pricing Schedule

CLIN Structure

Base Period (Transition) Base Period pricing shall include all costs required to ensure a smooth transition of operations from contract 70T04019C9CAP3000. The transition period does not include Preventive Maintenance (PM), Corrective Maintenance (CM), or Radiation Surveys (RS) associated with maintenance actions.

Transition Period (6 Months)

Option Years 1 Through 7 The Program Management CLINs (10001-70001) total price is based on a monthly price for twelve months for Option Periods 1 through 6, and six months for Option Period 7.

The EDS Maintenance (PM/CM) CLIN (X002) quantities are based on estimated counts for each Option Period, but payment will be based on actual quantities deployed and operated in the field. Unit prices represent the price to maintain one unit for one day, and is inclusive of all direct and indirect costs (labor, facilities, materials, supplies, subcontract labor, shipping, and travel). Unit prices shall not change based on additions or reductions to the final quantity for each sub CLIN. The total price for each X002 sub CLIN is based on the unit cost multiplied by the quantity of units multiplied by the number of days in the year. For Option Years 1, 2, 3, 5, and 6, the quantity is multiplied by 365 days. For Option Year 4, multiply by 366 days to include February 29, 2028. For Option Year 7, multiply by 183 days (June 1, 2030 to November 30, 2030).

EDS Maintenance Provisional CLINs for Excepted Maintenance (X003), Ancillary Logistics Support (X004), and Emerging IT Requirements (X005) are based on Not-To-Exceed (NTE) amounts set by the Government for each Option Year.

Option Year 1 (12 Months)

Total Option Year 1

Option Year 2 (12 Months)

NTE

Total Option Year 2

Option Year 3 (12 Months)

NTE

Total Option Year 3

Option Year 4 (12 Months)

NTE

Total Option Year 4

Option Year 5 (12 Months)

NTE

Total Option Year 5

Option Year 6 (12 Months)

NTE

Total Option Year 6

Option Year 7 (6 Months)

Total Option Year7

Total Contract Value

Sustainment of Transportation Security Equipment (CLIN X002) – Fixed Unit Price The Contractor shall provide the labor, materials, and support equipment to provide sustainment of Transportation Security Equipment (TSE) in accordance with the requirements set forth in the PWS. All maintenance, repair and other related actions to sustain TSE will be included in the fixed unit pricing established in this Section. It is the Government’s intent that the fixed unit pricing for TSE Sustainment Services include all estimated costs for preventive and corrective maintenance as defined in C.4.1.1, Preventive Maintenance (PM), C.4.1.1.1 Radiation Surveys, and C.4.1.2, Corrective Maintenance, of Part C. The fixed unit pricing for CLIN X002 shall also include services for the multiplexing and network servers required for in-line baggage screening operations and their peripheral equipment as required.

The FUP CLIN structure is designed to provide flexibility to the Government in order to accommodate differing quantity amounts throughout the life of the contract. Unit pricing for CLIN X002 only applies to deployed, in-service TSE that are not covered under the manufacturer’s warranty, and unit quantity totals may fluctuate in any given month. TSA continues to evaluate the use of all TSE deployed in the field and reserves the right to move, remove, or add any technology/model of equipment to any federalized airport or TSA designated facility required to meet TSA’s constantly evolving screening objectives and policies. The Contractor shall invoice using the procedures set forth in Section B.3.4.4, Development of Invoices.

TSA reserves the right to modify the contract to include provisions for new equipment and future technologies not listed in Section A.3, Pricing Schedule, as they are procured and deployed. The pricing for these potential future CLINs will be negotiated when the requirement is added to this contract.

There are predictable National Security Special Events (NSSE) designated by the Secretary of Homeland Security that shall be considered within the scope of this contract and covered within CLIN X002. Examples include, but are not limited to, presidential inaugurations, major international summits held in the United States, major sporting events, and presidential nominating conventions. These events cause a temporary period of significantly increased passenger enplanements at affected locations, and are highly visible to the nation’s leadership and members of the press. It is incumbent upon the Contractor to provide enhanced maintenance support during these periods, and the Contractor shall ensure that sufficient staffing and parts support are available and in place to support these events. The Contractor shall coordinate with local TSA, the COR, and the CO to establish and implement enhanced support for these locations for any event officially deemed an NSSE by the federal government. Support plans shall be prepared and submitted in accordance with CDRL A016, Holiday and NSSE Support Plans.

Program Management (CLIN X001) – Firm Fixed Price CLIN X001 shall include all program management related costs required to perform the requirements in Section C.3.1, Program Management, of the PWS, including submission of Contract Data Requirement Lists (CDRLs) as required in Section C.2.4, Document Submission and Compliance.

Provisional CLINs – Time and Materials

Excepted Maintenance (CLIN X003) The Government intends to establish a provisional CLIN in the event TSA requires the Contractor to respond to work order events where abnormal discrepancies occur that are outside the scope of paragraph A.3.2, Sustainment of TSE (CLIN X002) – FUP, and exceeds the initial quoted price of $10,000 to repair. The purpose of this CLIN is to allow the Government to quickly respond to emergency situations and events where requirements could not be reasonably planned for but services are required immediately.

To ensure the rapid response required in these situations, the Contractor shall provide a written Rough Order of Magnitude (ROM) estimate within 24 hours of being notified of the requirement by the CO. The Government may authorize work to begin while the ROM is being generated or as prices are being negotiated.

The Contractor shall submit an Excepted Maintenance Equipment Quote including a description of the maintenance issue, equipment identification, location, part and labor cost, shipping cost if applicable, and any other pertinent information needed to define the work required to affect the repair. The Contractor shall provide labor in accordance with the fully burdened Fixed Labor Rates established in Section A.3.5, Labor Categories for Services. The Contractor shall be reimbursed for all allowable, allocable, and reasonable costs for Materials and Travel in accordance with FAR 31.2, Contracts with Commercial Organizations. No profit or fee will be paid on costs for Materials and Travel.

Ancillary Logistics Services (CLIN X004) The Government intends to establish a provisional CLIN in the event TSA requires the Contractor to provide the services of engineers and technicians to perform technical engineering support, analysis, and engineering-related tasks that will be specified on an as-needed basis. This may include, but not be limited to, supplemental support of infrequent, unpredictable events that require additional support but are not officially deemed as NSSE, and maintenance training for Transportation Security Administration personnel established in Section C.4.1.6, Maintenance Training for Transportation Security Administration Personnel.

Emerging IT Requirements (CLIN X005) The Government intends to establish a provisional CLIN in the event TSA requires the Contractor to respond to emergent IT requirements. The purpose of this CLIN is to allow the Government to quickly respond to unforeseen IT compliance requirements not addressed in Section C.3.10, Security Requirements. The CO will determine if a requirement qualifies under this CLIN.

Labor Categories for Services The Contractor shall, when so ordered by the Government, provide the necessary management, labor, facilities, materials, and supplies to perform the tasks for CLINs X003, X004, and X005 needed by the Government. The Contractor shall provide services on these CLINs on a T&M basis, utilizing the labor categories and fully burdened labor rates established in this contract.

The following labor rates are fully burdened with Overhead, General and Administrative Costs, Profit/Fee and any appropriate Escalation charges. These rates shall apply for all the Option Years as shown below.

Year 6 Option Year 7

Program Manager

Deputy Program Manager

Project/Task Manager

Field Service Technician 1

Field Service Technician 2

Engineer

Call Center Support

Contracts Manager

Radiation Safety Officer (RSO)

ISSO

Cyber Security Lead

Analyst

The Government reserves the right to add additional labor categories as necessary under CLINs X003, X004, and X005.

Year 1 Option Year 2 Option Year 3 Option Year 4 Option Year 5

Material Handling

General and Administrative (G&A)

Disincentives The Reliability, Maintainability, and Availability (RMA) performance of TSE is critical to TSA. Therefore, performance disincentives will be imposed to ensure that the Contractor meets the Service Level Agreement (SLA) set forth in Section C.4.1.5, PBL Service Level Agreement (SLA), MTBCF Performance Goal, and Performance Metrics. TSA will calculate RMA data as applicable in accordance with Attachment D-3, TSE Metrics Terms and Definitions & RMA Metrics, Attachment D-3a, Data Dictionary, and Attachment D-7, ILS SLA Performance Metrics. Attachment D-3 provides common metrics across all maintenance contracts and D-3a is a reference dictionary providing descriptions for terms used in D-3. Attachment D-7 provides specific direction for this contract, and if the attachments appear to conflict, Attachment D-7 takes precedence. Any disincentives will be applied to invoices in accordance with Sections B.3.4.4 Development of Invoices and B.3.4.5 Disincentives.

Disincentives

(a) EDS Airport Operational Availability (AO) For any ‘airport – EDS’ for which the Ao is not performed within the requirements of Section C.4.1.5, PBL Service Level Agreement (SLA), MTBCF Performance Goal, and Performance Metrics, all specific OEM EDS ‘airport - EDS’ shall be decremented by 5% for the applicable month.

(b) EDS System Operational Availability (AO) For any ‘individual – EDS’ for which the Ao is not performed within the requirements of Section C.4.1.5, PBL Service Level Agreement (SLA), MTBCF Performance Goal, and Performance Metrics, the EDS shall be decremented by 10% for the applicable month.

(c) MUX/NEDs Operational Availability (AO) For any ‘airport – MUX or NEDs’ for which the Ao is not performed within the requirements of Section C.4.1.5, PBL Service Level Agreement (SLA), MTBCF Performance Goal, and Performance Metrics, all EDS TSE associated with the MUX or NEDs cluster shall be decremented by 5% for the applicable month.

(d) Preventive Maintenance Disincentive For each EDS for which the Preventive Maintenance is not performed within the requirements of Section C.4.1.5, PBL Service Level Agreement (SLA), MTBCF Performance Goal, and Performance Metrics, the Contractor shall decrement each EDS by 10% beginning in the month missed.

MTBCF Performance Goal (X006) The Government seeks to improve system reliability for the following technology models, CTX9000, CTX9400, CTX5800, CTX9800, CTX9800SEIO, CT80DR, 6000/6600, 6700, and 6700ES, by incentivizing the contractor to increase Mean Time Between Critical Failure (MTBCF). In order to earn this payment, the Contractor will develop and implement a reliability improvement plan to improve EDS reliability, increasing MTBCF by 25% in each year over the previous year for each specific technology model. The MTBCF baseline metric will be established based on the MTBCF performance from the last 12 months from contract 70T04019C9CAP3000 (derived from data reported in CDRL A004, TSE Database, and CDRL A023, TSE RMA Metrics, in Option Year 4 & 5).

For new technology models (CTX5800 and any other new future technologies) that have exited warranty, the technology will be applicable for the MTBCF performance goal when thirty (30) systems have been deployed and utilized in screening operations and there are a minimum of six (6) months remaining in the Period of Performance (POP) for the current year of the contract (i.e., Year 1, Year 2, Year 3). If the last system is deployed with less than 6 months in the current year of the contract, then the technology model will not be applicable for that year and will be applicable for the following year of the contract. The baseline metric will be based on the last 12 months of operational fleet data for that technology model from the warranty production contract or the current maintenance contract from 12 months prior to the date the technology model became applicable.

To achieve the performance goal payment, the Contractor is required to increase the MTBCF by 25% over the established baseline MTBCF. The government’s intent is to incentivize the contractor to end the year with a sustainable MTBCF improvement that is 25% greater than the baseline at the beginning of the year. The government recognizes that it would be unrealistic to expect the contractor to achieve an average MTBCF that is 25% higher than the baseline for the entire year, as this would either require the improvement to take place at the beginning of the year, or MTBCF improvements substantially higher than 25% throughout the year so that, when averaged, the overall growth is 25%. Therefore, through each 12-month period of performance (POP), the Contractor shall achieve, at a minimum, an average MTBCF of 12.5% increase when considering all 12 months of performance, and achieve the 25% goal in at least one month of the last quarter of the POP.

Example- if the baseline MTBCF average is 400, in order to qualify for the performance goal, the MTBCF average for Year 1 must be greater than (or equal to) 450 MTBCF and the Contractor shall achieve one month in the last quarter of the POP at greater than (or equal to) 500. The following Year 2 baseline is established based on the previous Year 1 MTBCF average achieved and so on through the end of the final year of the contract. The baseline can never drop below the original Year 1 baseline.

Year 1 – If the hypothetical baseline is 400 and the Contractor achieved a MTBCF average (over the 12-month POP) of 470, and 505 MTBCF is achieved during one month, the performance goal payment is earned as performance exceeded 12.5% of the MTBCF minimum goal and exceeded the 25% goal (500) during one month in the last quarter of the POP.

Year 2 – The baseline is 470, and the achieved MTBCF average is 525, the performance goal payment would not be earned as the Contractor did not achieve the required level of 528.75, even if the 25% goal of 587.50 was met in the final quarter of the POP.

Year 3 – The baseline is 525, the required MTBCF minimum goal is 590 and the Contractor would be required to achieve 656.25 at least one month during the final quarter of the POP to achieve the performance goal payment.

(a) Mean Time Between Critical Failure (MTBCF) MTBCF shall be calculated nationwide on an annual basis. If MTBCF meets or exceeds the requirement of Section C.4.1.5.2, MTBCF Performance Goal, the Contractor shall apply the performance goal in accordance with Section B.3.4.6, MTBCF Performance Goal Payment.

Period of Performance The period of performance of this contract is shown in the table below.

(End of Part A)

- Contract Clauses

Federal Acquisition Regulation (FAR) Clauses

52.252-2 Clauses Incorporated by Reference (Feb 1998) This contract incorporates one or more clauses by reference, with the same force and effect as if they were given in full text. Upon request, the Contracting Officer will make their full text available. Also, the full text of a clause may be accessed electronically at this/these address(es):

https://www.acquisition.gov/far/

52.323-4 Contract Terms and Conditions – Commercial Items (Alternate I) (Dec 2022)

(a) Inspection/Acceptance. The Government has the right to inspect and test all materials furnished and services performed under this contract, to the extent practicable at all places and times, including the period of performance, and in any event before acceptance. The Government may also inspect the plant or plants of the Contractor or any subcontractor engaged in contract performance. The Government will perform inspections and tests in a manner that will not unduly delay the work.

(1) Within a reasonable time after the defect was discovered or should have been discovered; and

(2) Before any substantial change occurs in the condition of the item, unless the change is due to the defect in the item.

(b) Assignment. The Contractor or its assignee may assign its rights to receive payment due as a result of performance of this contract to a bank, trust company, or other financing institution, including any Federal lending agency in accordance with the Assignment of Claims Act ( 31 U.S.C. 3727). However, when a third party makes payment (e.g., use of the Governmentwide commercial purchase card), the Contractor may not assign its rights to receive payment under this contract.

(c) Changes. Changes in the terms and conditions of this contract may be made only by written agreement of the parties.

(d) Disputes. This contract is subject to 41 U.S.C. chapter 71, Contract Disputes. Failure of the parties to this contract to reach agreement on any request for equitable adjustment, claim, appeal or action arising under or relating to this contract shall be a dispute to be resolved in accordance with the clause at Federal Acquisition Regulation (FAR) 52.233-1, Disputes, which is incorporated herein by reference. The Contractor shall proceed diligently with performance of this contract, pending final resolution of any dispute arising under the contract.

(e) Definitions. The clause at FAR 52.202-1, Definitions, is incorporated herein by reference. As used in this clause –

(i) "Direct materials" means those materials that enter directly into the end product, or that are used or consumed directly in connection with the furnishing of the end product or service.

(ii) "Hourly rate" means the rate(s) prescribed in the contract for payment for labor that meets the labor category qualifications of a labor category specified in the contract that are-

(A) Performed by the contractor;

(B) Performed by the subcontractors; or

(C) Transferred between divisions, subsidiaries, or affiliates of the contractor under a common control.

(iii) "Materials" means-

(A) Direct materials, including supplies transferred between divisions, subsidiaries, or affiliates of the contractor under a common control;

(B) Subcontracts for supplies and incidental services for which there is not a labor category specified in the contract;

(C) Other direct costs (e.g., incidental services for which there is not a labor category specified in the contract, travel, computer usage charges, etc.);

(D) The following subcontracts for services which are specifically excluded from the hourly rate: [Insert any subcontracts for services to be excluded from the hourly rates prescribed in the schedule.]; and

(E) Indirect costs specifically provided for in this clause.

(iv) "Subcontract" means any contract, as defined in FAR subpart 2.1, entered into with a subcontractor to furnish supplies or services for performance of the prime contract or a subcontract including transfers between divisions, subsidiaries, or affiliates of a contractor or subcontractor. It includes, but is not limited to, purchase orders, and changes and modifications to purchase orders.

(f) Excusable delays. The Contractor shall be liable for default unless nonperformance is caused by an occurrence beyond the reasonable control of the Contractor and without its fault or negligence such as, acts of God or the public enemy, acts of the Government in either its sovereign or contractual capacity, fires, floods, epidemics, quarantine restrictions, strikes, unusually severe weather, and delays of common carriers. The Contractor shall notify the Contracting Officer in writing as soon as it is reasonably possible after the commencement of any excusable delay, setting forth the full particulars in connection therewith, shall remedy such occurrence with all reasonable dispatch, and shall promptly give written notice to the Contracting Officer of the cessation of such occurrence.

(g) Invoice.

(1) The Contractor shall submit an original invoice and three copies (or electronic invoice, if authorized) to the address designated in the contract to receive invoices. An invoice must include-

(i) Name and address of the Contractor;

(ii) Invoice date and number;

(iii) Contract number, line item number and, if applicable, the order number;

(iv) Description, quantity, unit of measure, unit price and extended price of the items delivered;

(v) Shipping number and date of shipment, including the bill of lading number and weight of shipment if shipped on Government bill of lading;

(vi) Terms of any discount for prompt payment offered;

(vii) Name and address of official to whom payment is to be sent;

(viii) Name, title, and phone number of person to notify in event of defective invoice; and

(ix) Taxpayer Identification Number (TIN). The Contractor shall include its TIN on the invoice only if required elsewhere in this contract.

(x) Electronic funds transfer (EFT) banking information.

(A) The Contractor shall include EFT banking information on the invoice only if required elsewhere in this contract.

(B) If EFT banking information is not required to be on the invoice, in order for the invoice to be a proper invoice, the Contractor shall have submitted correct EFT banking information in accordance with the applicable solicitation provision, contract clause (e.g., 52.232-33, Payment by Electronic Funds Transfer-System for Award Management, or 52.232-34, Payment by Electronic Funds Transfer-Other Than System for Award Management), or applicable agency procedures.

(C) EFT banking information is not required if the Government waived the requirement to pay by EFT.

(2) Invoices will be handled in accordance with the Prompt Payment Act ( 31 U.S.C.3903) and Office of Management and Budget (OMB) prompt payment regulations at 5 CFR Part 1315.

(h) Patent indemnity. The Contractor shall indemnify the Government and its officers, employees and agents against liability, including costs, for actual or alleged direct or contributory infringement of, or inducement to infringe, any United States or foreign patent, trademark or copyright, arising out of the performance of this contract, provided the Contractor is reasonably notified of such claims and proceedings.

(i) Payment.-

(1) Work performed. The Government will pay the Contractor as follows upon the submission of commercial invoices approved by the Contracting Officer:

(i) Hourly rate.

(A) The amounts shall be computed by multiplying the appropriate hourly rates prescribed in the contract by the number of direct labor hours performed. Fractional parts of an hour shall be payable on a prorated basis.

(B) The rates shall be paid for all labor performed on the contract that meets the labor qualifications specified in the contract. Labor hours incurred to perform tasks for which labor qualifications were specified in the contract will not be paid to the extent the work is performed by individuals that do not meet the qualifications specified in the contract, unless specifically authorized by the Contracting Officer.

(C) Invoices may be submitted once each month (or at more frequent intervals, if approved by the Contracting Officer) to the Contracting Officer or the authorized representative.

(D) When requested by the Contracting Officer or the authorized representative, the Contractor shall substantiate invoices (including any subcontractor hours reimbursed at the hourly rate in the schedule) by evidence of actual payment, individual daily job timecards, records that verify the employees meet the qualifications for the labor categories specified in the contract, or other substantiation specified in the contract.

(E) Unless the Schedule prescribes otherwise, the hourly rates in the Schedule shall not be varied by virtue of the Contractor having performed work on an overtime basis.

(1) If no overtime rates are provided in the Schedule and the Contracting Officer approves overtime work in advance, overtime rates shall be negotiated.

(2) Failure to agree upon these overtime rates shall be treated as a dispute under the Disputes clause of this contract.

(3) If the Schedule provides rates for overtime, the premium portion of those rates will be reimbursable only to the extent the overtime is approved by the Contracting Officer.

(ii) Materials.

(A) If the Contractor furnishes materials that meet the definition of a commercial product at FAR 2.101, the price to be paid for such materials shall not exceed the Contractor’s established catalog or market price, adjusted to reflect the-

(1) Quantities being acquired; and

(2) Any modifications necessary because of contract requirements.

(B) Except as provided for in paragraph (i)(1)(ii)(A) and (D)(2) of this clause, the Government will reimburse the Contractor the actual cost of materials (less any rebates, refunds, or discounts received by the contractor that are identifiable to the contract) provided the Contractor-

(1) Has made payments for materials in accordance with the terms and conditions of the agreement or invoice; or

(2) Makes these payments within 30 days of the submission of the Contractor’s payment request to the Government and such payment is in accordance with the terms and conditions of the agreement or invoice.

(C) To the extent able, the Contractor shall-

(1) Obtain materials at the most advantageous prices available with due regard to securing prompt delivery of satisfactory materials; and

(2) Give credit to the Government for cash and trade discounts, rebates, scrap, commissions, and other amounts that are identifiable to the contract.

(D) Other Costs. Unless listed below, other direct and indirect costs will not be reimbursed.

(1) Other Direct Costs. The Government will reimburse the Contractor on the basis of actual cost for the following, provided such costs comply with the requirements in paragraph (i)(1)(ii)(B) of this clause: None

(2) Indirect Costs (Material Handling, Subcontract Administration, etc.). The Government will reimburse the Contractor for indirect costs on a pro-rata basis over the period of contract performance at the following fixed price: $0

(2) Total cost. It is estimated that the total cost to the Government for the performance of this contract shall not exceed the ceiling price set forth in the Schedule and the Contractor agrees to use its best efforts to perform the work specified in the Schedule and all obligations under this contract within such ceiling price. If at any time the Contractor has reason to believe that the hourly rate payments and material costs that will accrue in performing this contract in the next succeeding 30 days, if added to all other payments and costs previously accrued, will exceed 85 percent of the ceiling price in the Schedule, the Contractor shall notify the Contracting Officer giving a revised estimate of the total price to the Government for performing this contract with supporting reasons and documentation. If at any time during the performance of this contract, the Contractor has reason to believe that the total price to the Government for performing this contract will be substantially greater or less than the then stated ceiling price, the Contractor shall so notify the Contracting Officer, giving a revised estimate of the total price for performing this contract, with supporting reasons and documentation. If at any time during performance of this contract, the Government has reason to believe that the work to be required in performing this contract will be substantially greater or less than the stated ceiling price, the Contracting Officer will so advise the Contractor, giving the then revised estimate of the total amount of effort to be required under the contract.

(3) Ceiling price. The Government will not be obligated to pay the Contractor any amount in excess of the ceiling price in the Schedule, and the Contractor shall not be obligated to continue performance if to do so would exceed the ceiling price set forth in the Schedule, unless and until the Contracting Officer notifies the Contractor in writing that the ceiling price has been increased and specifies in the notice a revised ceiling that shall constitute the ceiling price for performance under this contract. When and to the extent that the ceiling price set forth in the Schedule has been increased, any hours expended and material costs incurred by the Contractor in excess of the ceiling price before the increase shall be allowable to the same extent as if the hours expended and material costs had been incurred after the increase in the ceiling price.

(4) Access to records. At any time before final payment under this contract, the Contracting Officer (or authorized representative) will have access to the following (access shall be limited to the listing below unless otherwise agreed to by the Contractor and the Contracting Officer):

(i) Records that verify that the employees whose time has been included in any invoice meet the qualifications for the labor categories specified in the contract;

(ii) For labor hours (including any subcontractor hours reimbursed at the hourly rate in the schedule), when timecards are required as substantiation for payment-

(A) The original timecards (paper-based or electronic);

(B) The Contractor’s timekeeping procedures;

(C) Contractor records that show the distribution of labor between jobs or contracts; and

(D) Employees whose time has been included in any invoice for the purpose of verifying that these employees have worked the hours shown on the invoices.

(iii) For material and subcontract costs that are reimbursed on the basis of actual cost-

(A) Any invoices or subcontract agreements substantiating material costs; and

(B) Any documents supporting payment of those invoices.

(5) Overpayments/Underpayments. Each payment previously made shall be subject to reduction to the extent of amounts, on preceding invoices, that are found by the Contracting Officer not to have been properly payable and shall also be subject to reduction for overpayments or to increase for underpayments. The Contractor shall promptly pay any such reduction within 30 days unless the parties agree otherwise. The Government within 30 days will pay any such increases, unless the parties agree otherwise. The Contractor’s payment will be made by check. If the Contractor becomes aware of a duplicate invoice payment or that the Government has otherwise overpaid on an invoice payment, the Contractor shall-

(i) Remit the overpayment amount to the payment office cited in the contract along with a description of the overpayment including the-

(A) Circumstances of the overpayment (e.g., duplicate payment, erroneous payment, liquidation errors, date(s) of overpayment);

(B) Affected contract number and delivery order number, if applicable;

(C) Affected line item or subline item, if applicable; and

(D) Contractor point of contact.

(ii) Provide a copy of the remittance and supporting documentation to the Contracting Officer.

(6)(i) All amounts that become payable by the Contractor to the Government under this contract shall bear simple interest from the date due until paid unless paid within 30 days of becoming due. The interest rate shall be the interest rate established by the Secretary of the Treasury, as provided in 41 U.S.C. 7109, which is applicable to the period in which the amount becomes due, and then at the rate applicable for each six month period as established by the Secretary until the amount is paid.

(ii) The Government may issue a demand for payment to the Contractor upon finding a debt is due under the contract.

(iii) Final Decisions. The Contracting Officer will issue a final decision as required by 33.211 if-

(A) The Contracting Officer and the Contractor are unable to reach agreement on the existence or amount of a debt in a timely manner;

(B) The Contractor fails to liquidate a debt previously demanded by the Contracting Officer within the timeline specified in the demand for payment unless the amounts were not repaid because the Contractor has requested an installment payment agreement; or

(C) The Contractor requests a deferment of collection on a debt previously demanded by the Contracting Officer (see FAR 32.607-2).

(iv) If a demand for payment was previously issued for the debt, the demand for payment included in the final decision shall identify the same due date as the original demand for payment.

(v) Amounts shall be due at the earliest of the following dates:

(A) The date fixed under this contract.

(B) The date of the first written demand for payment, including any demand for payment resulting from a default termination.

(vi) The interest charge shall be computed for the actual number of calendar days involved beginning on the due date and ending on-

(A) The date on which the designated office receives payment from the Contractor;

(B) The date of issuance of a Government check to the Contractor from which an amount otherwise payable has been withheld as a credit against the contract debt; or

(C) The date on which an amount withheld and applied to the contract debt would otherwise have become payable to the Contractor.

(vii) The interest charge made under this clause may be reduced under the procedures prescribed in FAR 32.608-2 in effect on the date of this contract.

(viii) Upon receipt and approval of the invoice designated by the Contractor as the "completion invoice" and supporting documentation, and upon compliance by the Contractor with all terms of this contract, any outstanding balances will be paid within 30 days unless the parties agree otherwise. The completion invoice, and supporting documentation, shall be submitted by the Contractor as promptly as practicable following completion of the work under this contract, but in no event later than 1 year (or such longer period as the Contracting Officer may approve in writing) from the date of completion.

(7) Release of claims. The Contractor, and each assignee under an assignment entered into under this contract and in effect at the time of final payment under this contract, shall execute and deliver, at the time of and as a condition precedent to final payment under this contract, a release discharging the Government, its officers, agents, and employees of and from all liabilities, obligations, and claims arising out of or under this contract, subject only to the following exceptions.

(i) Specified claims in stated amounts, or in estimated amounts if the amounts are not susceptible to exact statement by the Contractor.

(ii) Claims, together with reasonable incidental expenses, based upon the liabilities of the Contractor to third parties arising out of performing this contract, that are not known to the Contractor on the date of the execution of the release, and of which the Contractor gives notice in writing to the Contracting Officer not more than 6 years after the date of the release or the date of any notice to the Contractor that the Government is prepared to make final payment, whichever is earlier.

(iii) Claims for reimbursement of costs (other than expenses of the Contractor by reason of its indemnification of the Government against patent liability), including reasonable incidental expenses, incurred by the Contractor under the terms of this contract relating to patents.

(8) Prompt payment. The Government will make payment in accordance with the Prompt Payment Act ( 31 U.S.C. 3903) and prompt payment regulations at 5 CFR part 1315.

(9) Electronic Funds Transfer (EFT). If the Government makes payment by EFT, see 52.212-5(b) for the appropriate EFT clause.

(10) Discount. In connection with any discount offered for early payment, time shall be computed from the date of the invoice. For the purpose of computing the discount earned, payment shall be considered to have been made on the date that appears on the payment…