Section J-3 CO Markup Rates.docx

Change Order Mark-up Rates/Extended Overhead

The offeror may elect to propose the NAVFAC standard rates, if desired, as annotated below each item.

The change order markup cost elements are awarded as part of the contract and will be used as the markups for both additive and deductive modifications after award for the term of the contract for both prime and subcontractors as listed below. In addition to the Base Price Proposal submitted, the offeror shall provide proposed modification/change order percentage rates, for Field Overhead, Home Office Overhead, and Profit, as follows:

PRIME CONTRACTOR’S WORK:

(a) Proposed field overhead rate, line 9 of Form 4330/43 (NAVFAC Standard Rate – 10%)

SUBCONTRACTOR’S WORK:

(b) Proposed field overhead rate, (subcontractor’s Work), line 19 of Form 4330/43 (NAVFAC Standard Rate – 10%)

(c) Proposed home office overhead, (subcontractor’s work), line 21 of Form 4330/43 (NAVFAC Standard Rate – 3%)

(d) Proposed profit, (subcontractor’s work), line 22 of Form 4330/43

SUMMARY

(e) Proposed overhead rate on subcontractors, line 27 Form 4330/43 (NAVFAC Standard Rate – 5%)

(f) Proposed prime Contractor home office overhead rate, line 28 of Form 4330/43 (NAVFAC Standard Rate – 3%)

(g) Proposed profit, line 29 of Form 4330/43

(h) Proposed extended overhead rate from Total Price Evaluation Input Data (to be utilized in lieu of percent in Line 9 of Form 4330/43 when a contract modification results in a compensable time extension of the contract.)*

The Government will evaluate estimated cost of changed work as follows:

Using Form 4330/43 (8/88), 2% of your base proposal will be entered on Line 8 and 3% of your base price proposal will be entered on line 18. The subtotal cost (Line 30) will be calculated using the proposed rates.

In the event contract modifications result in time extensions of the contract completion date due to Suspension of Work, FAR 52.242-14, the proposed Extended Overhead rate will be used to calculate the extended overhead.

For evaluation purposes, a five (5) day extension of the contract will be used. Your proposed Extended Overhead rate will be multiplied by five (5) days and added to the subtotal computed on Line 30, which will be used in the Total Price Calculation to evaluate the offer.

The above rates will become part of the successful offeror’s resultant contract and will be applied to the direct costs of all contract modifications.

Field Overhead will be evaluated as a percent mark-up and not a direct cost to the change proposal. Field overhead costs cover indirect costs incurred on this project that are chargeable only to this contract and include costs incurred on the job site incident to the performance of the work, including but not limited to, the costs of superintendent, timekeeping, clerical work, engineering, job site supervision, engineer, secretaries, tool shed keeper, temporary facilities, Contractor’s office, utilities, storage shed, supplies, office supplies, temporary protection and/or maintenance, dust control, noise control, winter protection, barricades (rented), haul roads, clean-up, progress reports, equipment, superintendent’s truck, truck for clean-up, and fringe benefits for supervisory and administrative personnel.

*Extended Overhead Rate – Prior to the start of on-site work, the Contractor may elect to use the extended overhead rate in lieu of the percent rates for Field Overhead shown on Line 9. If the Contractor elects to use the Extended Overhead rate, field overhead mark-ups will be allowed only in modifications that result in a compensable time extension of the contract, with the above. Extended Overhead Rate used to calculate the field overhead. If the Contractor does not elect to use the Extended Overhead Rate in lieu of the percentage rates for Field Overhead shown on Line 9, the extended overhead rate will be used only on modifications to the contract that results in a compensable time extension of the contract due to Suspension of Work, FAR 52.242-14.