D.C. Mun. Regs. r. 19-2817

Current through Register Vol. 71, No. 24, June 14, 2024

Rule 19-2817 - CONTRACT COST PRINCIPLES

2817.1

The contract cost principles shall be used in the pricing of fixed-price contracts, subcontracts, and modifications to contracts and subcontracts whenever cost analysis is performed, or a contract clause requires the determination or negotiation, or allowance of costs.

2817.2

The contract cost principles shall be mandatory and incorporated by reference in contracts as the basis for the following:

(a) Determining reimbursable costs under cost-reimbursement contracts and cost- reimbursement subcontracts, and the cost-reimbursement portion of time-and-materials contracts, except when material is priced on a basis other than at cost;

(b) Negotiating indirect cost rates;

(c) Proposing, negotiating, or determining costs under terminated contracts;

(d) Price revision of fixed-price incentive contracts;

(e) Price redetermination of price redetermination contracts; and

(f) Pricing changes and other contract modifications.

2817.3

The factors to be considered in determining whether a cost is allowable shall include, but not be limited to, reasonableness, allocability, allowability, and the terms of the contract.

2817.4

A cost shall be reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person in the conduct of competitive business.

2817.5

A cost shall be allocable to a contract if it is assignable or chargeable to one or more cost objectives on the basis of relative benefits received or other equitable relationship.

2817.6

The following shall be a treatment of specific non-allowable cost categories:

(a) Bad debt, penalties and fines, and contingency costs;

(b) Depreciation and use allowances made for fully depreciated assets;

(c) Advertising costs and entertainment costs, unless incurred as a direct result of compliance with specific provisions of the contract or written instructions of the contracting officer;

(d) Gifts, contributions, and donations (reasonable costs for the morale, health, welfare, food, services, or lodging of contractor's employees are not gifts and shall be allowable); and

(e) Interest expenses incurred by contractors cost unless stated otherwise in the terms and conditions of the solicitation.

D.C. Mun. Regs. r. 19-2817

Final Rulemaking published at 37 DCR 4081, 4100-02 (June 22, 1990)