NOAA Acquisition Manual


Main Table of Contents

Subchapter C- Contracting Methods and Contract Types

Part 1330-16 Types of Contracts

Subpart 1330-16.1 Selecting Contract Types

1330-16.103 Negotiating Contract Type

Subpart 1330-16.4 Incentive Contracts

1330-16.405 Cost-reimbursement Incentive Contracts

1330-16.405-270 Cost plus Award Fee and Award Term Processes Supporting Fees and Extensions

Subpart 1330-16.5 Indefinite - Delivery Contracts

1330-16.505 Ordering

Subpart 1330-16.6 Time-and-Materials, Labor-Hour, and Letter Contracts

1330-16.601 Time-and-materials contracts

1330-16.603 Letter Contracts

1330-16.603-370 Limitations


Part 1330-16 Types of Contracts

Subpart 1330-16.1 Selecting Contract Types

1330-16.103 Negotiating Contract Type

(d)(1)

  1. The HCO is the approving authority for determinations to use cost-reimbursement contracts, time-and-material and labor-hour contracts, and incentive contracts, unless the BPO retains the approval authority for determinations in the following instances:
    1. The HCO is also the contracting officer of the acquisition, or
    2. The expected lifecycle cost of the acquisition exceeds the threshold established in CAM1307.1 Section 5.7 for review of the formal acquisition plan by the Acquisition Review Board, or
    3. Any other acquisition designated by the PE or BPO that is subject to the major investment oversight process.

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Subpart 1330-16.4 Incentive Contracts

1330-16.405 Cost-reimbursement Incentive Contracts

1330-16.405-270 Cost-Plus Award Fee and Award Term Processes Supporting Fees and Extensions

(a) The Heads of Contracting Offices (HCOs) shall do the following:

  1. Require performance monitors to provide narrative comments that identify specific strengths, weaknesses, and deficiencies to support assigned ratings.

    1. Documentation for the basis of all award fee determinations will be required and documentation shall address specific strengths, weaknesses, and deficiencies supporting the ratings given, as measured against the criteria in the Award Fee Plan.
    2. A cost-benefit analysis in decisions on CPAF and CPAT contracts must be performed; include documentation on how the benefits will offset the costs and justifications and approvals for all contract actions containing award fee and award term provisions.
    3. The amount of award fee earned (if any) shall be commensurate with the contractor’s overall cost, schedule, and technical performance as measured against the contract requirements as stated in the Award Fee Plan (see FAR 16.401(e)(2).
    4. At a minimum, documentation will include a determination that overall cost, schedule, and technical performance in the aggregate is or is not at a satisfactory level.
  2. Develop award-fee and award-term incentive structures that encourage contractor excellence.

    1. Contracts containing award-fee and incentive structures will clearly include incentive structures and award-fee evaluation criteria linked to acquisition objectives,
    2. Objectives will be defined in terms of contract cost, schedule, and technical performance, and
    3. Evaluation criteria will be developed that motivates the contractor to enhance performance in the areas being rated, but not at the expense of at least minimum acceptable performance in all other areas.

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  1. Develop measurable and outcome-based criteria for assessing contractor performance for award-fee and award-term extensions in accordance with FAR 16.401(e)(3)(ii) and (iii) and Commerce Acquisition Manual (CAM) 1316.1 Chapter 7.2(a). Award-fee plans shall describe how contractor performance will be measured against the award-fee evaluation criteria.
  2. Establish a clear division of responsibility for the evaluation team (award-determining official, Performance Evaluation Board, and performance monitors) and prohibit the same official from performing multiple roles.
  3. Develop controls over the maintenance of contract files to ensure more immediate availability and completeness of documentation for all contract actions.

    1. Establishment, maintenance, and disposal of contract files will follow the guidance from FAR 4.8 and NOAA’s Acquisition Process Guide 5.13.2.
  1. The contracting officer shall ensure that the contract file contains documentation to support the decision to use an incentive contract in accordance with the documentation requirements listed in FAR 16.401(d); 16.401(e)(ii) and CAM 1316.1 paragraph 7.3(a).

Subpart 1330-16.5 Indefinite-Delivery Contracts

1330-16.505 Ordering

(b)(2)(C) Approval.

The approval levels for a justification for an exception to fair opportunity are located in the NOAA AGO Review and Approval Matrix

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Subpart 1330-16.6 Time-and-Materials, Labor-Hour, and Letter Contracts

1330-16.601 Time-and-materials contracts

(d)(1) Limitations.

ii.  The Senior Bureau Procurement Official (SBPO) has delegated the authority to the Heads of Contracting Offices (HCO) to approve a determination and findings when no other contract type is suitable prior to execution of the base period if the base period plus any option periods exceed three years on time-and-materials type contracts. This authority is non-delegable and will remain in effect until rescinded.

1330-16.603 Letter Contracts

1330-16.603-370 Limitations

(a) Requests for BPO pre-award review and approval of a letter contract or modification shall be made by the HCO.

(b) The contracting officer shall prepare a written determination that fully explains the need to begin performance before an agreement on, or determination of, contract terms, specifications, and price. At a minimum, the determination shall address the following:

  1. Description of the requirement,
  2. Date that the requirement was first known to exist,
  3. Statement of the determination required by FAR 16.603-3,
  4. Statement of the necessity and advantage to the Government of using a letter contract,
  5. Description of the adverse impact on agency requirements resulting from delays in beginning performance,
  6. Reasons why negotiation of a definitive contract or priced order did not and cannot occur in sufficient time to meet the acquisition need,
  7. Statement of all substantive matters that need to be resolved including contract terms, specifications, or prices that are not agreed to,
  8. Proposed definitization schedule to convert the undefinitized contract action to a definitive contract.

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