PART 1849
TERMINATION OF CONTRACTS
SUBPART 1849.1 GENERAL
PRINCIPLES
1849.101 Authorities
and responsibilities.
1849.101-70 NASA authorities and responsibilities.
1849.101-71 Termination authority.
1849.102 Notice
of termination.
1849.102-70 Prior clearance of significant contract
terminations.
1849.102-71 Prior clearance of contract terminations
resulting from a major breach of safety or security.
1849.105 Duties
of termination contracting officer after issuance of notice of termination.
1849.105-70 Termination docket checklist.
1849.110 Settlement negotiation memorandum.
1849.110-70 Memorandum contents.
1849.111 Review
of proposed settlements.
SUBPART 1849.5 CONTRACT
TERMINATION CLAUSES
1849.505 Other
termination clauses.
1849.505-70 NASA contract clause.
PART 1849
TERMINATION OF CONTRACTS
1849.101 Authorities and responsibilities.
1849.101-70 NASA authorities and responsibilities.
(a)
Installations shall appoint a termination contracting officer (TCO) (see FAR
2.101) to
perform specific duties relating to contract termination as one of that
individual's primary functions. In addition to the responsibilities described
in this part and FAR Part 49, such duties should
include --
(1) Reviewing
NASA Forms 1412, Termination Authority;
(2) Reviewing
the contract and related documents before issuing the notice of termination, to
ensure protection of the Government's rights under the contract; and
(3)
Issuing notices of termination, reinstatement, and recision
to contractors;
(b)
Contracting offices shall utilize the services of the Department of Defense and
other Government agencies whenever possible to administer and negotiate
settlement of terminated contracts. Delegation of the negotiation of termination
settlement function shall be made in accordance with FAR Subpart
42.2
and 1842.2.
1849.101-71 Termination authority.
NASA
Form 1412, Termination Authority, is prescribed for use by NASA installations
when initiating action to terminate a contract for convenience or default. The
project manager or the activity initiating the procurement request should
initiate the action by completing NASA Form 1412 and submitting it to the
contracting officer.
1849.102 Notice of termination.
1849.102-70 Prior clearance of significant contract terminations.
(a)
Congressional notification is required for any termination involving a
reduction in employment of 100 or more contractor employees. Proposed
terminations must be cleared through the Headquarters Office of Legislative
Affairs (Code LB) before release of the termination notice, or any information
on the proposed termination, to the contractor. Proposed terminations expected
to result in a reduction of fewer than 100 should be similarly cleared if the
installation believes it to be significant.
(b)
The contracting officer shall submit the following information to Code LB, and
a copy to the Office of Procurement (Code HS), as soon as possible after the
decision to terminate is made. Until clearance is obtained, this information
shall be treated as "For Official Use Only" unless the information is
classified.
(1) Contract
number.
(2) Date
of award.
(3)
Type of contract.
(4)
Name of company.
(5)
Nature of contract or end item.
(6)
Reasons for the termination.
(7)
Contract price of items terminated.
(8) Total
number of contractor employees involved, including the Government's estimate of
the number that may be discharged.
(9)
Anticipated impact on the company and the community.
(10) Name
of the community affected.
(11)
Area labor category.
(12)
Whether contractor is large or small business.
(13)
Any known impact on disadvantaged employment programs.
(14)
Total number of subcontractors involved and the impact in this area, if known.
(15) Unclassified
draft of suggested press release.
(c)
To minimize termination costs, Code LB shall act promptly on the request and
provide a response not later than two working days after receipt of the
information in paragraph (b) of this section.
1849.102-71 Prior clearance of contract terminations resulting
from a major breach of safety or security.
The
Assistant Administrator for Procurement (Code HS) must be notified prior to
taking any action to terminate because of a major breach of safety or security.
1849.105 Duties of termination contracting officer after issuance of notice of termination.
1849.105-70 Termination docket checklist.
The
termination contracting officer shall complete NASA Form 1413, Termination
Docket Checklist.
1849.110 Settlement negotiation memorandum.
1849.110-70 Memorandum contents.
The
TCO shall include the following information in the settlement negotiation
memorandum. Contractors and subcontractors are encouraged to use this format
appropriately modified for subcontract settlements submitted for review and
approval.
(a) General information.
(1) Identification.
(i) Name and address
of the contractor and any pertinent affiliation between prime contractors and
subcontractors relative to the overall settlement.
(ii)
Names and titles of contractor and Government personnel who participated in the
negotiation.
(2) Description
of terminated contract.
(i) Contract number;
(ii) Date of award;
(iii)
Contract type;
(iv)
General description of contract items;
(v)
Total contract price; and
(vi)
Applicable contract termination provisions and clause.
(3)
Termination notice.
(i) Date of the termination notice;
(ii)
Effective date of termination;
(iii)
Scope and nature of termination (complete or partial);
(iv)
Items terminated;
(v)
Unit prices;
(vi)
Total price of items terminated for fixed-price contracts or the estimated cost
and fee applicable to items terminated for cost-reimbursement type contracts;
(vii)
Whether the termination notice was amended and, if so, why;
(viii)
Whether the contractor stopped work on the termination effective date (if it
did not, furnish details) and whether subcontracts were terminated promptly;
(ix)
Any redirection of common items and return of goods to the contractor's
suppliers; and
(x)
Extent of contract performance and timely deliveries by the contractor.
(b)
Contractor's settlement proposal.
(1)
Date and amount. Date and location where the
claim was filed and its gross amount (if interim settlement proposals were
filed, information shall be furnished for each claim).
(2) Basis
of claim. E.g., inventory, total cost, or other basis, including an
explanation of any approvals granted in connection with submission on other
than an inventory basis.
(3) Examination
of proposal. Types of reviews made and by whom
(audit, engineering, legal, or other).
(c) Tabular
summary of contractor's claim and the settlement. The cost
elements/items, the amounts claimed, the Government recommended position
(including auditor, field, and technical personnel recommendations), and the
negotiated settlement amounts. This summary shall include, if appropriate,
previously reimbursed and unreimbursed costs
applicable to the prime contractor and subcontractor, previous profit/fees paid
and unpaid; settlement cost less disposal credit or other credits, and a
recapitulation of previous settlements. The summary of the negotiated
settlement shall include the amount claimed and allowed for contractor and/or
subcontractor changes, disposal, prior payment credits, and contract price.
(d)
Settlement narrative summary.
(1)
Contractor's cost.
(2) Profit/Fee.
(3) Settlement
expenses not included in the audit.
(4)
Number and dollar amount of any subcontractor settlements approved by the TCO
and concluded by the contractor under delegation of authority.
(5)
Total amount of any partial payments.
(6)
Total of unliquidated progress or advance payments.
(7)
Claims of the Government against the contractor included in settlement
agreement reservations.
(8) Assignments, including the name and
address of each assignee.
(9)
Disposal credits.
(10) Status
of plant clearance actions and all inventory sold,
retained, or otherwise properly disposed of in accordance with applicable plant
clearance regulations, including a consolidated closing plant clearance report,
if applicable.
(11)
Status of Government property accountability.
(12)
Disposition of any special tooling, if applicable.
(13)
Proposed reservations of rights to the Government or to the contractor.
(e)
Recommendation. Amount of the gross settlement
recommended and TCO statement that it is fair and reasonable to the Government
and the contractor.
(f)
TCO Signature and date.
1849.111 Review
of proposed settlements.
(1) Settlements
shall be reviewed in accordance with center-prescribed procedures.
(2) The
TCO may authorize the contract administration office cognizant of a lower-tier
subcontractor to grant approval or ratification of proposed subcontractor
settlements described in FAR
49.108-3(c)
that are first reviewed and referred by the prime contractor to the TCO. This
procedure is not applicable to settlements between the contractor and its first
tier subcontractors.
Subpart 1849.5--Contract
Termination Clauses
1849.505 Other termination clauses.
1849.505-70 NASA contract clause.
The
contracting officer shall insert the clause at 1852.249-72, Termination (Utilities),
in all solicitations and contracts for utilities services.