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10-13

 

Procurement Information Circular

 

September 23, 2010                                                                           

IMPLEMENTATION OF THE FEDERAL FUNDING ACCOUNTABILITY AND TRANSPARENCY ACT (FFATA) OF 2006

 

PURPOSE:  To provide guidance on implementing the Federal Funding Accountability and Transparency Act (FFATA) (PL 109-282 as amended by section 6202(a) of PL 110-252) which results in a new FAR requirement for contractors to report subcontract awards and executive compensation.   

 

BACKGROUND:   FAC 2005-044 was issued July 8, 2010.  It implements an interim rule entitled Reporting Executive Compensation and First-Tier Subcontract awards which is a statutory requirement of FFATA.  The rule is intended to provide public visibility of Federal contracting.  As a result of this rule, the applicability and requirements of FAR 52.204-10, Reporting Executive Compensation and First-Tier Subcontractor Awards, are greatly expanded.

 

Several years ago, a pilot program was tested which required prime contractors holding contracts of $500M or more to report subcontracts over $1M.  The pilot was implemented because the Government-wide data collection systems were not able to handle the reporting volume anticipated if FFATA was fully implemented.  The systems - Electronic Subcontract Reporting System (eSRS), The FFATA Subaward Reporting System (FSRS), which is a newly created module under eSRS, and the Central Contractor Registration (CCR), are now ready, and the interim rule calls for a phased-in approach to accommodate the systems.

 

 Although the rule is interim, it is unlikely that it will change substantively before becoming final because the FFATA requirements are explicit.  Any changes to the requirements as a result of the final rule will be reflected in an update to this PIC, as necessary.

 

FFATA reporting is distinct from the reporting requirements under the American Recovery and Reinvestment Act (The Recovery Act.)  It requires far less reporting by contractors and far less verification by the Agency.  Most notably, FFATA reporting is done in the Integrated Acquisition Environment (IAE) which is composed of Government-wide, procurement data systems.  Much of the effort associated with Recovery Act reporting results from the use of the stand-alone FederalReporting.gov system which is managed outside of the Federal procurement community.

 

GUIDANCE: 

 APPLICABILITY:  The rule is applicable to solicitations issued after July 8, 2010, and resulting contracts.  COs should include the clause in all new solicitations.  The clause is available in CMM.

 

Solicitations issued since July 8, 2010 should be amended to include the provision. 

COs should not modify contracts issued after July 8, 2010 to include the clause if the solicitation was issued prior to July 8, 2010. 

 

COs should modify existing IDIQ contracts or other ordering vehicles to cover future orders. The clause at FAR 52.204-10 should be added to the basic contract so that it can be invoked in applicable task and delivery orders.  The applicability outlined above applies to orders issued under any task or delivery order vehicle.  That is, if the solicitation for a task or delivery order was issued prior to July 8, the resulting order will not be subject to the FFATA reporting requirements.  Solicitations for orders, or orders without a solicitation, issued after July 8, 2010, are subject to the clause.

 

PRIME CONTRACTOR RESPONSIBILITIES:  The subcontract reporting requirements and the executive compensation reporting requirements have different beginning dates, reporting schedules, and exceptions.

 

Reporting Subcontracts

 

For contracts that include the clause 52.204-10, prime contractors are responsible for reporting their subcontract information, for any first-tier subcontracts of $25,000 or more, by the end of the month following the month of award, at FSRS, in accordance with the following phase-in schedule:

 

1.      Until September 30, 2010, any newly awarded subcontracts if the prime contract is $20M or more.

2.      From October 1, 2010, to February 28, 2011, any newly awarded subcontract if the prime contract is $550,000 or more.

3.      Beginning March 1, 2011, any newly awarded subcontract must be reported if the prime contract equals or exceeds $25,000.

If a prime contractor, in the previous tax year, had gross income, from all sources, of under $300,000, the contractor is exempt from the requirement to report subcontract awards.  Likewise, if a subcontractor, in the previous tax year, had gross income, from all sources, of under $300,000, the prime contractor does not need to report subcontracts awarded to that subcontractor.

Reporting Executive Compensation

 

For contracts that include the clause 52.204-10, prime contractors are responsible for:

 

1.      Reporting their own executive compensation (in CCR) by the end of the month following the month of award of a contract with FAR 52.204-10, and reporting annually, thereafter.  Executive compensation is tied to the DUNS number of the entity to which the contract is awarded.  Accordingly, contractors required to report should report the compensation of the five most highly compensated managers associated with the DUNS number on the award. 

2.      Reporting executive compensation for their first-tier subcontractors (in FSRS) by the end of the month following the month of award of a subcontract of $25K or more, and reporting annually, thereafter.

Note that there are several exceptions to the requirement to report executive compensation and thresholds to be met before the requirement applies.  Many contractors will be exempt from reporting this information for themselves and for some of their subcontractors.  Reporting is not required if:

1.       the contractor or subcontractor is a publically-traded corp, and their executive compensation is already publically available in IRS and/or FTC filings, or

2.      they received less than 80 percent of their previous year’s annual gross income from Federal contracts, subcontracts, loans, grants, and cooperative agreements, and

3.      they received less than $25M from annual gross revenues from Federal contracts, subcontracts, loans, grants, and cooperative agreements.

CO RESPONSIBILITIES

 

Agencies are responsible for quarterly verification of contractor reports in FSRS.  Ultimately, this is a CO responsibility but Centers may elect to have other individuals or teams undertake the quarterly verification.  The verification is limited to ensuring consistency with contract information that is readily available to the CO.  The review is necessary because the integrated system will cross check contractor entries against FPDS data and anomalies in contract information will require correction by either the contractor or the contracting officer.  Examples of data fields that COs must verify include:

 

-      prime contract number

-      awarding Agency name and code      (8000 for NASA)

-      funding Agency name and code                     (8000 for NASA)

-      Government contracting office code  (see enclosure)

-      Treasury Account Symbol (TAS)                   (see enclosure)

-      Prime NAICS

 

The contractor’s reporting requirements include many data elements that COs will not know and, therefore, are not responsible for verifying, such as:

 

-     Whether or not a subcontract has been issued

-     Whether or not reported subcontract value, place of performance, etc., is accurate.

-     Whether or not a prime or subcontractor meets the thresholds or qualifies under an exemption to executive compensation reporting. 

 

Because the FSRS is a subcomponent of eSRS, users already registered in eSRS will have access to FSRS to verify contractor reporting.  Others needing access to eSRS/FSRS for purposes of FFATA reporting should contact the Agency Administrator for the Office of Procurement, Jamiel Commodore.  If access to eSRS is required for issues related to the Small Business Administration’s subcontracting program, i.e. the former SF 294 and SF 295 reporting, the Agency Administrator in the Office of Small Business Programs, Richard Mann, should be contacted.

 

EFFECTIVE DATE:  This PIC is effective as dated and shall remain in effect until rescinded.   

 

HEADQUARTERS CONTACT:  Leigh Pomponio, Contract Management Division, (202) 358-0592, e-mail: leigh.pomponio@nasa.gov.

 

 

James A. Balinskas

Director, Contract Management Division

Office of Procurement

Enclosure

 

DISTRIBUTION:

  PIC LIST

ENCLOSURE

 

Government Contracting Office Codes  (6 characters or less)

APL00            NASA Management Office at APL

ARC00            Ames Research Center

DFRC0           Dryden Flight Research Center

GRC00            Glenn Research Center

GSFC0            Goddard Space Flight Center

HQTR0           NASA Headquarters

JSC00              Johnson Space Center

KSC00            Kennedy Space Center

LARC0           Langley Research Center

MSFC0           Marshall Space Flight Center

NMO00           NASA Management Office (JPL)

NSSC0            NASA Shared Service Center

SSC00 Stennis Space Center

 

Treasury Account Symbols

 

80

0105

Space Flight, Control and Data Communications

80

0107

Construction of Facilities

80

0108

Research & Development

80

0109

Office of Inspector General

80

0110

Science, Aeronautics & Technology

80

0111

Human Space Flight

80

0112

Mission Support

80

0113

National Aeronautical Facilities

80

0114

Science, Aeronautics & Exploration

80

0115

Space Flight Capabilities

80

0116

Office of Inspector General - Recovery Act

80

0119

Science - Recovery Act

80

0120

Science

80

0121

Cross Agency Support - Recovery Act

80

0122

Cross Agency Support 

80

0123

Exploration - Recovery Act

80

0124

Exploration 

80

0125

Aeronautics - Recovery Act

80

0126

Aeronautics 

80

0128

Education

80

0130

Construction & Environmental Compliance & Remediation