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  • Question

    Are the airfare rates available through DOT and GSA for CYs 2010 and 201 based on nonrefundable airfare?


    Answer

    The question and background provided do not identify a specific DOT and GSA publication.  As such, speculating which publication and also on the mechanics of the compilation of the data may not be prudent.  Further, specific details regarding the mechanics of compilation of data in DOT or GSA reports may necessarily require inquiry directly to DOT and/or GSA.  In other words, additional facts are needed to adequately answer the question posed.

    Nonetheless, any use of historical airfare data to determine allowability necessarily requires application of the cost principles contained in the Federal Acquisition Regulation.  The Federal Acquisition Regulation (FAR) identifies five requirements that must be met in order for a cost to be allowable (
    FAR 31.201-2(a)). To be allowable, the cost must be: (1) reasonable, (2) allocable to the contract, (3) compliant with Cost Accounting Standards (as applicable, otherwise generally accepted accounting principles), (4) compliant with the terms of the contract, and (5) compliant with any specific limitations set forth in FAR subpart 31.2All five of the above requirements must be met in order for any claimed airfare costs to be allowable.  The first (reasonable) and last (specific limitations) of the above five requirements seem to be of most concern in dealing with the issues posed.  Of specific interest are those  limitations provided at FAR §31.205-46(b).

    For contracts entered into from 1986 to 2010, the FAR provision (31.205-46(b)) addressing the allowability of airfare costs limited allowability as follows: 
    “Airfare costs in excess of the lowest customary standard, coach, or equivalent airfare offered during normal business hours are unallowable except when such accommodations require circuitous routing, require travel during unreasonable hours, excessively prolong travel, result in increased cost that would offset transportation savings, are not reasonably adequate for the physical or medical needs of the traveler, or are not reasonably available to meet mission requirements. However, in order for airfare costs in excess of the above standard airfare to be allowable, the applicable condition(s) set forth above must be documented and justified.”  

    Effective 11 January 2010,
    FAR 31.205-46(b) was amended by replacing “lowest customary standard, coach, or equivalent airfare offered” with “lowest priced airfare available to the contractor.”  The balance of FAR 31.205-46(b) remained unchanged and is current as of this writing.  Any proper determination of unallowable airfare costs in accordance with FAR 31.205-46(b) for contracts entered into after 11 January 2010 must therefore necessarily involve a determination by the contracting officer that the claimed airfare is in excess of the “lowest priced airfare available to the contractor.”

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