B-203911 L/M, NOV 17, 1981, OFFICE OF GENERAL COUNSEL

B-203911 L/M: Nov 17, 1981

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WE HAVE NO OBJECTION TO THE PROPOSED CHANGES.

B-203911 L/M, NOV 17, 1981, OFFICE OF GENERAL COUNSEL

DIGEST: 1. GAO HAS NO OBJECTION TO PROPOSAL TO INCREASE TOTAL COST PROGRESS PAYMENTS SET FORTH IN FPR SEC. 1-30.510.1 FOR SMALL BUSINESS TO 90 PERCENT AND FOR OTHER CONCERNS TO 85 PERCENT TO BE CONSISTENT WITH RECENT CHANGES TO THE DEFENSE ACQUISITION REGULATION (DAR) OR TO PROPOSAL TO INCREASE PROGRESS RATES SET FORTH IN FPR SEC. 1-30.510-2 FOR LABOR AND MATERIAL COSTS. 2. GAO HAS NO OBJECTION TO AMENDING FPR TO RAISE AUDIT THRESHOLDS FOR VARIOUS COST-TYPE CONTRACTS FROM $250,000 TO $500,000.

MR. PHILIP G. READ, GENERAL SERVICES ADMINISTRATION:

BY LETTER DATED JUNE 30, 1981, YOU REQUESTED OUR COMMENTS ON WHETHER TOTAL COST PROGRESS PAYMENT RATES SET FORTH IN FEDERAL PROCUREMENT REGULATIONS (FPR) SEC. 1-30.510-1, SHOULD BE INCREASED TO 90 PERCENT FOR SMALL BUSINESSES AND 85 PERCENT FOR OTHER CONCERNS SO AS TO BE CONSISTENT WITH RECENT CHANGES MADE IN THE DEFENSE ACQUISITION REGULATION (DAR) BY A MARCH 10, 1981 MEMORANDUM FROM THE DIRECTOR, DEFENSE ACQUISITION REGULATORY COUNCIL. YOU ALSO ASKED WHETHER PROGRESS PAYMENT RATES BASED ON DIRECT LABOR AND MATERIAL COSTS SET FORTH IN FPR SEC. 1-30.510-2 SHOULD BE INCREASED AND WHETHER THE AUDIT THRESHOLD FOR VARIOUS COST-TYPE CONTRACTS SHOULD BE INCREASED FROM $250,000 TO $500,000 TO REFLECT THE INCREASE MADE IN THE DAR BY DEFENSE ACQUISITION CIRCULAR 76-26, DECEMBER 15, 1980.

WE HAVE NO OBJECTION TO THE PROPOSED CHANGES.