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  • Question

    How do you determine the Contract Clearance Authority approval threshold level of an Add/Delete Contract Change Proposal?


    Answer

    From the guidance found at Air Force Federal Acquisition Regulation Sup (AFFARS) 5301.9001 – Policy Thresholds and Approvals, Air Force Material Command Mandatory Procedures SUBPART 5301.1—PURPOSE, AUTHORITY, ISSUANCE, and SUBPART 5301.9000 —CLEARANCE Procedures:

    AFFARS 5301.9001 (f) – the note for “contract value” at the bottom of paragraph (f) states “contract value is determined by applying the sum of the value of the basic portion of the instant acquisition, plus any options, sums reserved for provisioning, and the value of any contingencies, such as ceiling, award fees/terms, and performance incentives.”


    AFMC MP 5301.108 (c) Dollar Thresholds.  The total estimated value of an acquisition forms the basis for determining the value of contract actions for clearance and other thresholds.  Examples of determining review value include:

    …(3) A modification which includes a price increase of $4M and a decrease of $3M would give an absolute value of $7M and would require clearance because that total exceeds the clearance threshold of $5M.
    AFMC MP 5301.9000
    (a) Contract actions requiring clearance.
    …(5) Modifications to orders.  Business and contract clearance is required for modifications to orders (but see (b)(90) below).
    (b) Contract actions excluded from business or contract clearances.
    (90) In addition to the contract actions specified at AFFARS 5301.9000(b), the following are also excluded from clearance:
    (1) Amendments to solicitations and modifications to orders that are solely administrative in nature.
    (2) Contract actions that solely provide incremental funding, award fee funding, or that are solely administrative in nature, no change to terms and conditions or type of funds.
    (3) Priced options that were previously established in the basic contract/order and that are exercised in accordance with the established prices and terms and conditions of the contract/order, as long as the option exercise period has not expired and the options were approved during contract clearance of the basic contract/order.
    (4) Orders that are issued in strict accordance with the previously approved pricing arrangements/pricing tables and other terms and conditions of the basic contract vehicle.  This exception includes orders where contractors are contacted solely to seek deeper discounts on known

    Based on the information you provided, the AFFARS and AFMC MP sections above appear to apply to your situation.  Unless one of the exceptions in AFMC MP 5301.9000 (b) applies, the contract value for purposes of determining the contract clearance threshold is the sum of the value of the basic portion of the instant acquisition, plus any options.  AFMC MP5301.108 (c) provides an example for determining the dollar threshold of a modification, which includes modifications to orders, as follows: a modification which includes a price increase of $4M and a decrease of $3M would give an absolute value of $7M and would require clearance because that total exceeds the clearance threshold of $5M.  If you require further assistance, recommend contacting the AFMC/PK FAR Part Analyst for FAR Part 1.1, Mr Billy Sandridge, at DSN 986-0378.


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