# DLAD PART 42

- SUBPART 42.2 - ASSIGNMENT OF CONTRACT ADMINISTRATION

- 42.202 Assignment of contract administration.
- 42.203 Retention of contract administration.
- 42.205 Designation of the paying office.

- SUBPART 42.3 - CONTRACT ADMINISTRATION OFFICE FUNCTIONS

- 42.302 Contract administration functions.

- SUBPART 42.5 Postaward Orientation

- 42.501 (e)(90)

- SUBPART 42.11 - PRODUCTION SURVEILLANCE AND REPORTING

- 42.1103 Policy.
- 42.1106 Reporting requirements.
- 42.1107 Contract clause.
- 42.1190 Contract acceleration/status requests.

- SUBPART 42.13 SUSPENSION OF WORK, STOP-WORK ORDERS, AND GOVERNMENT DELAY OF WORK

- 42.1305 Contract Clauses

- 42.1305-90

- SUBPART 42.14 TRAFFIC AND TRANSPORATION MANAGEMENT

- 42.14 (90) Use the clause at 52.242-9001 in solicitations and awards for FSG 34, Industrial Plant Equipment (IPE), whether for new procurements or rebuild/remanufacture/retrofit.
- 42.14 (91) Use the clause at 52.242-9002, Manufacturing Directive Number (MDN) for Use in Identifying Government-furnished Property (GFP) Transactions, only in Subsistence acquisitions for MRE and tray pack semi perishable items.

- SUBPART 42.15 -CONTRACTOR PERFORMANCE INFORMATION

- 42.1502 - Policy.

- SUBPART 42.71 - VOLUNTARY REFUNDS

- 42.7101 Solicited refunds.
- 42.7102 Disposition of voluntary refunds.
- 42.7204 Contract Clause
- 42.7400 General

PART 42

CONTRACT ADMINISTRATION

TABLE OF CONTENTS

SUBPART 42.2 - CONTRACT ADMINISTRATION SERVICES

42.202 Assignment of contract administration.

42.203 Retention of contract administration.

42.205 Designation of paying office.

SUBPART 42.3 - CONTRACT ADMINISTRATION OFFICE FUNCTIONS

42.302 Contract administration functions.

SUBPART 42.5 - POSTAWARD ORIENTATION

42.501 General

SUBPART 42.11 - PRODUCTION SURVEILLANCE AND REPORTING

42.1103 Policy

42.1106 Reporting requirements.

42.1107 Contract Clause

42.1190 Contract acceleration/status requests.

42.1305 Contract Clauses

42.14 Traffic And Transporation Management

42.1500 Contractor Performance Information

SUBPART 42.71 - VOLUNTARY REFUNDS

42.7101 Solicited refunds.

42.7102 Disposition of voluntary refunds.

42.7204 Contract CLauses

42.7400 General

SUBPART 42.2 - ASSIGNMENT OF CONTRACT ADMINISTRATION

42.202 Assignment of contract administration.

42.202(a)(92)

Use 52.242-9009, Correspondence Regarding Meal, Ready-to-Eat (MRE) and Tray Pack Contracts, in Subsistence acquisitions for MRE and tray pack semi-perishable items.

(a)(2)(90) When, in the contracting officer's judgment, a contract or order requires special attention by a field CAO that cannot be adequately conveyed by a criticality designator, this need will be communicated in writing by the contracting officer to the ACO. Drawing the attention of field CAOs to special contracting officer area(s) of concern should normally be accomplished during the assignment process, or as soon as possible thereafter. (See (a)(2)(92) below.)

(a)(2)(91) Contracting officers shall provide a complete purchase history to the CAO with the delegation of all unpriced orders for definitization.

(a)(2)(92) The letter of delegation required by (a)(90) below will state that the award is the first to the SDB (or the first for the item being procured) and request that a postaward orientation conference be conducted in accordance with FAR Subpart 42.5, Postaward Orientation (see especially FAR 42.501(b)). The letter should highlight any specific areas the contracting officer believes should be covered in the conference. It should also indicate that a letter or other form of written communication can be utilized in lieu of a postaward conference, provided that a copy is furnished to the contracting officer, and the CAO has performed a recent postaward conference with the SDB.

(a)(90) When a contracting activity makes an award having a dollar value of $25,000 or more to a small disadvantaged business (SDB), whether for the first time or for an item not previously purchased from the SDB, the award will be assigned for administration to the appropriate contract administration office (CAO).

(91) To implement the direction of the Secretary of Defense, December 6, 1995, and the Under Secretary of Defense (Acquisition and Technology), December 8, 1995, concerning single process/block changes, such changes to technical or management requirements in DoD contracts shall be accomplished as follows:

(1) When a contractor volunteers to participate in the single process initiative, the ACO shall organize a management council consisting of CAO, DCAA, key DoD customers (notionally defined as those representing 80% of the total dollar value of affected DoD contracts at the contractor's facility), and contractor personnel to perform an initial review of the adequacy and reasonableness of the contractor's single process concept with regard to that facility. Technical feasibility (including the impact on quality, maintenance, schedule, etc.), cost effectiveness, and program risk will be addressed during the council's preliminary review. A "rough order of magnitude" cost-benefit analysis will then be performed, sufficient to permit a determination whether the proposed changes can be approved, and contracts modified, on a no-cost, block change basis. The formal, single process proposal shall be reviewed and approved by the management council prior to the issuance of block modifications to existing contracts by the ACO.

(2) When DLA has contracts at a contractor's facility where a single process proposal has been submitted by the contractor, the following procedure shall be followed:

(i) If an ICP has a sufficient dollar value of contracts to warrant its participation as a key customer in the management council established to review single process proposals at a contractor's facility, or if its participation in the management council is otherwise considered necessary and appropriate, the ACO shall request, and the ICP shall designate, in writing, an individual to serve as its representative on the management council. The representative shall be a senior member of the acquisition workforce. The ICP's management council representative shall be empowered to speak on behalf of the ICP's contracting officers having cognizance of affected contracts. He/she shall request assistance, as necessary, from technical and other subject matter experts whenever a concept paper or proposal is submitted.

(ii) Each ICP shall also designate, in writing, a senior member of its acquisition workforce as its team leader for single process initiative issues ("SPI team leader"). In the absence of ICP representation on the management council, the SPI team leader shall be responsible for reviewing and making recommendations on the acceptability of concept papers or proposals referred to the ICP by the ACO. (This will typically occur when there are contracts with one or more DLA ICPs at the affected facility, but the Agency is not considered a "key customer," as defined above.) The SPI team leader shall be presumed to provide a coordinated delegation of authority for effecting block changes to the applicable DCMA component from cognizant contracting officers. Additionally, he/she may consult, as necessary, with appropriate technical and other subject matter experts prior to providing the ICP's concurrence with the proposed single process change. The SPI team leader shall be authorized to resolve disputes among that activity's contracting officers regarding concurrences/nonconcurrences with concept papers or proposals.

(iii) If an ICP has the largest total dollar value of, but not the only, DLA contracts with a contractor submitting a concept paper or proposal, its management council representative (or, if the ICP has no representation on the management council, its SPI team leader) will be considered the DLA component team leader with regard to the process proposal. He/she must brief, solicit recommendations from, and achieve consensus with the other affected ICPs' SPI team leaders on the acceptability of the single process concept and proposal. This individual shall then speak on behalf of the entire Agency. When consensus cannot be reached between and among the affected ICPs, disagreements shall be elevated by the DLA component team leader, and shall be resolved by DIRECTOR, ACQUISITION MANAGEMENT (J-7).

(iv) Notwithstanding that the single initiative/block change process is strongly supported at the highest levels of DoD, appointment of a DLA component team leader, ICP SPI team leader or ICP management council representative does not relieve the contracting officer of accountability for programs and contracts under his/her cognizance. Therefore, a contracting officer may appeal to DIRECTOR, ACQUISITION MANAGEMENT (J-7) any single process proposal decision he/she considers antithetical to the Government's best interests, and, if necessary, may carry that appeal through DIRECTOR, ACQUISITION MANAGEMENT (J-7) to the Defense Acquisition Executive or designee.

(c)(90) Responsibility for negotiation and execution of modifications to definitize undefinitized BOA orders or unpriced purchase orders shall not be delegated by the contracting office when a ceiling unit price is 125 percent or more of the lowest price paid within the 12 months preceding the effective date of the undefinitized BOA order or unpriced purchase order.

(e)(90) When contracts containing the Small Business, Small Disadvantaged Business and Women-owned Small Business Concerns Subcontracting Plan clauses are retained for contract administration by the contracting office, the contracting office shall request support from the cognizant CAO to administer the program imposed by these clauses. Section C of these contracts shall contain a statement substantially as follows: "The Small Business, Small Disadvantaged Business and Women-owned Small Business Concerns Subcontracting Plan clauses in this contract will be administered by the cognizant Contract Administration Office." (Note: Assignment for supporting administration will be made to the cognizant CAO of the geographical area in which the prime contractor is located.) Three copies of the contract and the Small Business, Small Disadvantaged Business and Women-owned Small Business Subcontracting Plan shall be forwarded to the cognizant CAO with a request for supporting contract administration of these clauses in accordance with FAR 42.202(e) and DFARS 242.204. The CAO will monitor the prime contractor's small business, small disadvantaged business, and women-owned small business concerns subcontracting programs and accomplish the periodic reviews required by FAR 42.302(a)(55).

(e)(91) When assignments of supporting contract administration are made to a field CAO under the administrative retention provisions of DFARS 242.203(a)(i) for either contracts and orders subject to a Master Solicitation Agreement, or large purchase awards that are not subject to a Master Solicitation Agreement, the following otherwise-optional functions should be delegated:

CANCELLATIONS - Modifications to cancel contract line item numbers (CLINs) not shipped, when requested by the contracting officer.

DIVERSIONS - Modifications effecting diversion when notice from the contracting officer provides shipping instructions.

EXCUSABLE DELAYS (e.g., strikes, floods, etc.) - Modifications to extend delivery date when delinquencies will result because of excusable delays.

NONEXCUSABLE DELAYS - Modifications, to revise delivery time up to 90 days, issued for consideration.

42.203 Retention of contract administration.

(a)(i)(90) DESC may retain administration of contracts for coal or bulk petroleum.

(90) If the contracting officer retains administration of a contract or order and a need subsequently arises to delegate any aspect of contract administration to a CAO, the contract or order shall be assigned for performance of all contract administration functions, except as stated in paragraph 42.204 above.

42.205 Designation of the paying office.

(2) All contracts assigned to a Service Plant Cognizance Representative for administration shall designate the disbursing office supporting the contracting office as disbursing office for the contract except for contracts resulting from MIPRs, which shall cite the disbursing office in accordance with DLAR 4115.3, Implementing Procedures for Purchase of Supplies Assigned to DLA Under the DoD Coordinated Procurement Program, paragraph (VI)(A)(13).

SUBPART 42.3 - CONTRACT ADMINISTRATION OFFICE FUNCTIONS

42.302 Contract administration functions.

(b)(2) See 42.202(c)(90).

(b)(7) The authority to negotiate and definitize adjustments to contract prices resulting from exercise of an economic price adjustment clause should be delegated to the contract administration office except in exceptional circumstances. If a decision is made to retain this function in the contracting office, the reason for retention shall be documented.

SUBPART 42.5 Postaward Orientation

42.501 (e)(90)

Post award orientation agendas should include discussion of dispute avoidance, early dispute resolution, and alternative dispute resolution.

SUBPART 42.11 - PRODUCTION SURVEILLANCE AND REPORTING

42.1103 Policy.

(90) Any contractually-binding decisions made by the Post-Award AS are subject to contracting officer approval if the Post-Award AS has no warrant (see 11.401-90(a)(2)).

(1) For all contracts, the Post-Award Acquisition Specialist (AS) is responsible for the actions shown below (also see 11.401-90, 11.401-92, 43.103(a)(90)(1)(i), and 49.101(c)).

(i) Performing analysis and resolving post-award requests from the Supply Planner for DLA Direct items or CAS for Customer Direct items, to ensure correct products are delivered and to achieve current timeline, accuracy, customer satisfaction and Administrative and Production Lead Time (ALT/PLT) targets;

(ii) Negotiating settlements for contractual changes that are beneficial to the Government in terms of costs and conditions within current timeline targets;

(iii) Monitoring vendor performance to ensure compliance with terms and conditions of award;

(iv) Taking action for non-compliance with current timeline targets; and

(v) Applying DLA business practices, in coordination with the Supply Planner for DLA Direct items or CAS for Customer Direct items, in contract termination decisions for convenience or default if requirements change or vendors fail to perform.

(2) For all contracts that involve a Shift to Commercial Practice or other change in the method of customer support (i.e., including corporate contracts, prime vendor and virtual prime vendor contracts), the Post-Award AS shall monitor contractor performance (price, delivery, etc.) to assure a satisfactory level of performance is achieved and maintained and is consistent with the planned levels throughout the contract period, including options.

42.1106 Reporting requirements.

(a) Submission of DD Form 375, Production Progress Report, will be required under the following circumstances, as a minimum:

(i) Items required to satisfy requisitions bearing UMMIPS priority 01 through 06.

(ii) Items that have been designated by the DSC Commanders as being in a critical supply position.

(iii) Items on the DoD, Military Service, or DLA critical list.

(iv) Items in direct support of the DoD Master Urgency List (MUL) categories.

(v) Contractors on the Military Services Contractor Experience Lists.

(vi) When requested by the DoD Project Manager.

42.1107 Contract clause.

(a) The contracting officer shall insert the clause at 52.242-9000, Production Progress Reports when FAR clause 52.242-2 is used and production progress reporting is required.

42.1107(b)

Use 52.242-9005, Report of Shipment (Reship) of Perishable Medical Items, in solicitations and contracts for perishable medical items being shipped by commercial carrier except those to air and water terminals for movement via the Defense Transportation System.

42.1190 Contract acceleration/status requests.

When it is determined that a customer’s need date may require a shorter delivery period than initially projected, the Supply Planner for DLA Direct items or the CAS for Customer Direct items will follow the policies and processes for expediting delivery in DIRECTOR, ACQUISITION MANAGEMENT (J-7) CROSS-PROCESS POLICY MEMORANDUM 05-002, Expedite Policy and Processes. As part of the investigation and resolution process, the Supply Planner for DLA Direct items or the CAS for Customer Direct items, may ask the Post-Award Acquisition Specialist (AS) to attempt to expedite delivery. (See mandatory guidance in DLAD PGI at 11.402(a)(90).) Any contractually-binding decisions made by the Post-Award AS are subject to contracting officer approval if the Post-Award AS has no warrant (see 11.401-90(a)(2)).

SUBPART 42.13 SUSPENSION OF WORK, STOP-WORK ORDERS, AND GOVERNMENT DELAY OF WORK

42.1305 Contract Clauses

42.1305-90

Use 52.242-9006, Delay of Installation for Medical and Laboratory Instrumentation, in solicitations and contracts for medical equipment requiring installation at destination.

SUBPART 42.14 TRAFFIC AND TRANSPORATION MANAGEMENT

42.14 (90) Use the clause at 52.242-9001 in solicitations and awards for FSG 34, Industrial Plant Equipment (IPE), whether for new procurements or rebuild/remanufacture/retrofit.

42.14 (91) Use the clause at 52.242-9002, Manufacturing Directive Number (MDN) for Use in Identifying Government-furnished Property (GFP) Transactions, only in Subsistence acquisitions for MRE and tray pack semi perishable items.

SUBPART 42.15 -CONTRACTOR PERFORMANCE INFORMATION

42.1502 - Policy.

(b)(90) Bulk, Bunkers and Into-Plane buying programs within the Defense Energy Support

Center (DESC) are exempt from the collection and reporting of contractor past performance

information. Post, Camp and Stations procurements within DESC are exempt from the collection and reporting of contractor past performance information.

SUBPART 42.71 - VOLUNTARY REFUNDS

42.7101 Solicited refunds.

(90) Overpricing.

(1) Before any recoupment action is taken, the contractor shall be contacted for any explanation of the basis of its price, and whether a pricing error has occurred. A determination shall then be made as to the existence of overpricing.

(2) If it is determined that overpricing has occurred, the contract should be canceled or a price reduction/voluntary refund requested, as applicable. Voluntary refund requests of $50,000 or more shall be approved by the chief of the contracting office (CCO). This approval authority may be delegated for up to a 2-year period, to one level below the CCO, (not redelegable, except at DSCs, where it may be redelegated, for requests does not exceed $500,000), to the chief of the pricing element and to a level no lower than the level above the contracting officer. The Refund requests with supporting rationale should be made in writing to an appropriate contractor official, and should include amounts related to any previous awards by the contracting office for the item for which a voluntary refund is also requested. Awards to other suppliers of the same item should also be reviewed for apparent overpricing, and any appropriate corrective action pursued in accordance with DFARS 242.71 and this subpart. Apparent overpricing on any award made by any other contracting office should be referred thereto for resolution.

(3) In the event efforts to secure a voluntary refund are unsuccessful, voluntary refund requests to the company head shall be referred for coordination/issuance by the approving official cited in (2), above.

(91) Nonconformance. Voluntary refunds for contractor-caused nonconformances discovered after Government acceptance shall be handled in accordance with procedures set forth in 46.407(f)(92) through (95).

42.7102 Disposition of voluntary refunds.

(90) Overpricing. The contract shall be modified, canceled, or terminated, or a voluntary or contractual refund request issued, as appropriate. The price recorded in the Contract Technical Data File shall be revised to reflect the price reduction, or the recoupment, and advice of corrective actions initiated or completed shall be forwarded to the Center Comptroller with a request for immediate revision of the standard price, if applicable. This section does not apply to voluntary refunds for contractor-caused nonconformances.

42.7204 Contract Clause

42.7204(90)

Use 52.242-9010, Title of Containers and Packaging Materials, in Subsistence Acquisitions for MRE and tray pack semi-perishable items.

SUBPART 42.74 TECHNICAL REPRESENTATION AT CONTRACTOR FACILITIES

42.7400 General

42.7400(a)(90)

Use 52.242-9008, Technical Direction, in C&T solicitations and contracts for research and development conducted under the DLA Apparel Research Network (ARN) Program when the Contracting Officer's Technical Representative (COTR) will be authorized to issue Technical Direction Letters (TDL) to the contractor.