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    Can I accept a reimbursable funding document as a project order for the government tasking and a direct cite economy order funding document for the contracted tasking without violating the 49/51 rule for a project order since the contractor funding was provided separately as a direct cite economy order funding document?


    This response is based on the information provided.  We suggest you discuss with your BFM, Comptroller, contracting team, program manager and/or legal department as appropriate. 


    We understand the project you describe as two separate yet related actions.  The first action is one agency funding another (yours) on a reimbursable basis for work done by your agency.  See FAR 17.500(c)(1) below.  The second action appears to be an interagency transfer or Military Interdepartmental Purchase Request (MIPR) for another unit to have your unit execute an action on your existing contract.  You will need to follow the requirements of the Economy Act. This second action is separate and appears to be contingent upon executing the first action successfully.  From a contractual/FAR perspective, we see no 51/49 workshare issue.


    For the first action, the work appears to be done by the government team.  If the government and contractor(s) will be working together on the first action.  The Financial Management Regulation (FMR) notes if there is a government contractor mix, the government team needs to be doing 51% or more of the work.  See the FMR excerpt below the FAR reference.


    "FAR 17. Subpart 17.5 - Interagency Acquisitions

    17.500 Scope of subpart.

          (a) This subpart prescribes policies and procedures applicable to all interagency acquisitions under any authority, except as provided for in paragraph (c) of this section....

          (c) This subpart does not apply to-

                   (1) Interagency reimbursable work performed by Federal employees (other than acquisition assistance), or interagency activities where contracting is incidental to the purpose of the transaction..."


    "The reference to the 49/51 rule is in Volume 11A Chapter 2 Section 020515 which states:  Ability to Perform. Project orders shall be issued only to those DoD owned establishments that are capable of substantially performing the work ordered. “Substantially,” as used in this paragraph, means that the project order recipient should incur costs of not less than 51 percent of the total costs attributable to rendering the work or services ordered. Total costs to render the work or services ordered include the costs of goods or services obtained from/provided by contractors.


    FMR Volume 11A Chapter 2 Section 0205, Conditions Governing Issuance and Acceptance of Project Orders, paragraphs 020501-020509 may also provide supporting information.


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