NASA Implements Award Fee Language Revision

August 2, 2011

NASA has adopted, without change, an interim final rule amending the NASA FAR Supplement (NFS) to implement the FAR Award Fee revision issued in Federal Acquisition Circular (FAC) 2005-46. Effective Date: August 2, 2011. Reference Federal Register Volume 76, Number 148 (Tuesday, August 2, 2011).

An interim rule was published on February 8, 2011 (76 FR 6696) implementing Federal Acquisition Circular (FAC) 2005-46 which significantly revised FAR Parts 16.305, 16.401, and 16.405-2 by incorporating new requirements relative to the use of award fee incentives. Specifically, the FAR rule implemented section 814 of the John Warner 2007 National Defense Authorization Act (NDAA) and section 867 of the Duncan Hunter 2009 NDAA and which required agencies to:
(1) Link award fees to acquisition objectives in the areas of cost, schedule, and technical performance;
(2) Clarify that the base fee may be included in a cost plus award fee type contract at the discretion of the contracting officer;
(3) Prescribe narrative ratings when making a percentage of award fee available;
(4) Prohibit the issuance of award fees for a rating period if the contractor's performance is judged to be below satisfactory;
(5) Conduct an analysis and consider the results of the analysis when determining whether to use an award fee type contract or not;
(6) Include specific content in the award fee plans; and
(7) Prohibit the rolling over of unearned award fees to subsequent rating periods.

NASA received no comments on the interim rule and has adopted the interim rule as a final rule without change.

FOR FURTHER INFORMATION CONTACT: Bill Roets, NASA, Office of Procurement, Contract Management Division (Suite 5G86); (202) 358-4483; e-mail: 

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