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Contract Compliance and the FAR

2. Presenters:. Monique AndersonAssistant Director, ORAAX5-6272

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Contract Compliance and the FAR

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    1. 1 Contract Compliance and the FAR

    2. 2 Presenters: Monique Anderson Assistant Director, ORAA X5-6272 – manders1@umd.edu Katie Petrone Sr. Contract Administrator, ORAA X5-6274 – kpetrone@umd.edu

    3. 3 We will cover... Difference between contract (FAR) and grant (OMB Circular A-110) Application of the FAR to contracts

    4. 4 Characteristics of a Grant Generally used to support an idea conceived by a Principal Investigator Flexible terms and conditions No-cost extensions easy to obtain Limited reporting requirements Due dates easier to change

    5. 5 Characteristics of a Contract Considered procurements - the Government is buying something it needs Terms can be very restrictive Missed due dates can result in penalties Additional reporting requirements Changes to SOW must be approved by the sponsor

    6. 6 Major Differences between Contracts and Grants Contract RFP solicitation Need for specific service/product Schedule technical & expenditure reports and/or other deliverables Grant Standard sponsor guidelines/proposal kits Support for work in general programmatic areas - need to advance knowledge, national interests Requires technical progress reports

    7. 7 More Major Differences Contract Payment often tied to deliverables Numerous special terms and conditions Close control on budget Can be cancelled for nonperformance Grant Payments may be in advance, by schedule, or upon completion General terms and conditions Flexible budget control Rarely cancelled for nonperformance

    8. 8 OMB Circulars and Contracts OMB A-21 Incorporated by FAR 31.3, allowable costs OMB A-110 Sets standards for grants & cooperative agreements Specific actions not applicable to contracts (i.e. expanded authorities) FAR replaces this circular in contracts

    9. 9 OMB Circulars and Contracts (cont’d.) OMB A-133 incorporated by FAR 52.215-02, Alt.II

    10. 10 Contracts & FAR Federal Acquisitions Regulations (FAR) - Uniform policies governance for Federal agencies - Is the “procedure manual” for Federal agencies to acquire goods and services, including research & development

    11. 11 Contracting under the FAR Common Types Cost-Reimbursement Fixed-Price Time & Material/Labor Hour Indefinite Delivery/Indefinite Quantity Purchase Orders

    12. 12 Contracting under the FAR Purpose Construction Research & Development Supply Service

    13. 13 Basic Contracting Considerations – Subcontracting Plans FAR 52.219-9, Small Business Subcontracting Plan (APR 2008) Required for contracts expected to exceed $550,000 Plan is developed jointly by department and Procurement & Supply

    14. 14 Basic Contracting Considerations – More on Subcontracting Plans Plan must detail how much of the contract work will be done by minority-owned, veteran-owned or women-owned small businesses Reports must be submitted semiannually detailing progress toward goals Failure to meet goals may result in fines or penalties

    15. 15 Basic Contracting Considerations – Equipment Ownership Government retains ownership of equipment purchased with contract funds: Status of equipment must be reported annually Non-profits must ask permission at the end of the contract to retain the equipment

    16. 16 Basic Contracting Considerations – Budget Monitoring Strict Budget vs Flexible Budget Written permission required to deviate from budget - Purchasing Equipment - New Subcontracts - Foreign Travel - Consultants

    17. 17 Basic Contracting Considerations – Notifying the Government FAR 52.232-22, Limitation of Funds (APR 1984) Included when a contract is being funded by the Government incrementally. Requirement to notify the Government when, in the next 60 days, 75% of the current contract value will be spent. Puts Government on notice that University is running out of contract funds.

    18. 18 Other Contract Considerations Fixed-price contracts and no-cost extensions (what is meant by “consideration?”) Pre-publication review Data and Intellectual Property rights Foreign National restrictions

    19. 19 Monique’s Favorite FAR site http://farsite.hill.af.mil/

    20. 20 Questions?

    21. 21 Case Study

    22. 22 THE END

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