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    Do we the Government pay the Architect Engineer Firm for their labor when they travel to the work site? Isn t it part of their overhead? Where in the regulations where we can/can not pay the contractor?


    Please see the DPAP site ( and go to the Cost, Pricing & Finance section.  Select the Contract Pricing Reference Guide, then go to section 8.2.3 Analyzing Professional And Consultant Service Costs.


    Normally, if the traveler's wages during travel are charged to an indirect labor account, the traveler's travel expenses are also charged as an indirect cost. If the traveler's wages during travel are charged direct to a contract, then the traveler's expenses for travel in connection with the contract are generally charged as a direct cost.


    Please refer to DPAP, Contract Pricing Reference Guide, since depending on the Contractor's accounting system this will make the determine on how the travel labor hours get charged.


    There are a couple of things to mention first in responding to your question.  Please note there are restrictions when it comes to performing A&E services in

    Japan.  I'm assuming the contractor you are negotiating with is an American company.  Please be sure of this fact as the DFARS prevents contracting with foreign firms in Japan as a heads up.  See the two citations below from the



    225.7015 Restriction on overseas architect-engineer services.  For restriction on award of architect-engineer contracts to be performed in Japan, in any North Atlantic Treaty Organization member country, or in countries bordering the Arabian Gulf, see 236.602-70.


    236.602-70 Restriction on award of overseas architect-engineer contracts to foreign firms.


    In accordance with Section 111 of Pub. L. 104-32 and similar sections in subsequent military construction appropriations acts, A-E contracts funded by military construction appropriations that are estimated to exceed $500,000 and are to be performed in Japan, in any North Atlantic Treaty Organization member country, or in countries bordering the Arabian Gulf, shall be awarded only to United States firms or to joint ventures of United States and host nation firms.


    Yes, travel expenses from the U.S. to Japan are allowable. Here is the FAR reference DPAP cites in the Contract Pricing Guide as follows:


    31.205-46 -- Travel Costs

    31.205-46(a)(1) Costs for transportation, lodging, meals, and incidental expenses.


    (1) Costs incurred by contractor personnel on official company business are allowable, subject to the limitations contained in this subsection. Costs for transportation may be based on mileage rates, actual costs incurred, or on a combination thereof, provided the method used results in a reasonable charge. Costs for lodging, meals, and incidental expenses may be based on per diem, actual expenses, or a combination thereof, provided the method used results in a reasonable charge.

    (2) Except as provided in subparagraph (a)(3) of this subsection, costs incurred for lodging, meals, and incidental expenses (as defined in the regulations cited in (a)(2)(i) through (iii) of this subparagraph) shall be considered to be reasonable and allowable only to the extent that they do not exceed on a daily basis the maximum per diem rates in effect at the time of travel  as set forth in the


    (iii)  Standardized Regulations (Government Civilians, Foreign Areas), Section 925, "Maximum Travel Per Diem Allowances for Foreign Areas," prescribed by the

    Department of State, for travel in areas not covered in (a)(2)(i) and (ii)

    of this subparagraph, available on a subscription basis from the --


    Superintendent of Documents

    U.S. Government Printing Office

    Washington, DC 20402

    Stock No.744-008-00000-0.


    Additionally, the DFARS has a limitation on travel expenses in that those costs cannot exceed whatever expenses would be reasonably paid to a Government employee.  That DFARS citation is as follows:


    237.104(f)(i) Payment to each expert or consultant for personal services under 5 U.S.C. 3109 shall not exceed the highest rate fixed by the Classification Act Schedules for grade GS-15 (see 5 CFR 304.105(a)). 


    (ii) The contract may provide for the same per diem and travel expenses authorized for a Government employee, including actual transportation and per diem in lieu of subsistence for travel between home or place of business and official duty station.


    (iii) Coordinate with the civilian personnel office on benefits, taxes, personnel ceilings, and maintenance of records.


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