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    When and why was this clause deleted (DFAR 252.242-7005)?. Was it replaced with an another provision? If it was deleted are contractors and no other requirement for report, is there still a need to continue to due the report. Was the C/SSR report replaced with another report?


    Answer

    1. The references quoted below in pertinent part are applicable to this response.

    A.  DEFENSE FAR SUPPLEMENT (DFARS) Change Notice 20060123
    Web link: http://www.acq.osd.mil/dpap/dars/archive/2006/change_notices.html

    Proposed Rule:
    Earned Value Management Systems (DFARS Case 2005-D006)
    Updates policy on contractor earned value management systems (EVMS) to revise the contract dollar thresholds at which EVMS requirements are applied and to eliminate requirements for contractors to submit cost/schedule status reports. Requires compliance with American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems, for cost or incentive contracts and subcontracts valued at $20,000,000 or more; and requires a formally validated and accepted EVMS for cost or incentive contracts and subcontracts valued at $50,000,000 or more. The objective is to streamline, improve, and increase consistency in earned value management requirements.

    The Federal Register notice [FR Doc E6-705 dated 23 Jan 2006] for this rule is available at:
    http://www.acq.osd.mil/dpap/dars/dfars/changenotice/archive/2006/20060123/E6-705.htm

    [FR Doc E6-705] ACTION: Proposed rule with request for comments.
    Regulatory Flexibility Act
    This proposed rule amends the DFARS to update requirements for DoD contractors to establish and maintain earned value management systems (EVMS). The rule revises the dollar thresholds at which EVMS requirements are applied and eliminates requirements for contractors to submit cost/schedule status reports under DoD contracts. The objective of the proposed rule is to streamline, improve, and increase consistency in earned value management implementation and application.

    B.  DEFENSE FAR SUPPLEMENT (DFARS) Change Notice 20080423
    Web link: http://www.acq.osd.mil/dpap/dars/archive/2008/change_notices.html

    Final Rule:
    Earned Value Management Systems (DFARS Case 2005-D006)
    Addresses requirements for DoD contractors to establish and maintain earned value management systems for cost or incentive contracts valued at $20,000,000 or more.

    Affected subparts/sections: DFARS Table of Contents; Part 234 Table of Contents; 234.0; 234.2; Part 242 Table of Contents; 242.11; Part 252 Table of Contents; 252.234; 252.242; PGI 234.2; PGI 242.11

    The Federal Register notice [FR Doc E8-8706 dated 23 Apr 2008] for this rule is available at:
    http://www.acq.osd.mil/dpap/dars/dfars/changenotice/2008/20080423/E8-8706.htm

    [FR Doc E8-8706] ACTION: Final rule.
    SUMMARY: DoD has issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to update requirements for DoD contractors to establish and maintain earned value management systems. The rule also eliminates requirements for DoD contractors to submit cost/schedule status reports.

    EFFECTIVE DATE: April 23, 2008.

    Regulatory Flexibility Act
      The threshold at which a DoD contractor previously was required to have an earned value management system that complied with ANSI/EIA-748 was $73 million for contracts and subcontracts funded with research, development, test and evaluation funding; and $315 million for contracts and subcontracts funded with operation and maintenance or procurement funding. This DFARS rule lowers those thresholds to a single $20 million for all cost or incentive contracts and subcontracts, regardless of funding type.

      The DFARS rule mitigates the impact on small businesses by establishing a $20 million contract threshold for earned value management requirements, and discouraging the application of earned value management requirements to fixed-price contracts and subcontracts, thereby establishing a very small subset of the small business community for which the rule would be applicable.

    Therefore, 48 CFR parts 234, 242, and 252 are amended as follows:
      PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
      6. Sections 252.234-7001 and 252.234-7002 are added ...
      8. Sections 252.242-7005 and 252.242-7006 are removed.

    C.  Data Item Description DI-MGMT-81466A dated 03-03-2005, “Contract Performance Report (CPR)”
      c. The CPR shall be used to obtain cost and schedule performance information on contracts requiring compliance with the American National Standards Institute/Electronic Industries Alliance Standard 748 (ANSI/EIA-748), Earned Value Management Systems (EVMS) (current version in effect at time of contract award). Refer to the Federal Acquisition Regulation (FAR) or Defense Federal Acquisition Regulation Supplement (DFARS) clause on contract. The CPR data elements shall reflect the output of the contractor's ANSI/EIA-748 compliant integrated management system.

    D.  Current DFARS References

    DFARS 234.201 – Policy
    (1) DoD applies the earned value management system requirement as follows:
      (i) For cost or incentive contracts and subcontracts valued at $20,000,000 or more, the earned value management system shall comply with the guidelines in the American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems (ANSI/EIA-748).
      (iii) For cost or incentive contracts and subcontracts valued at less than $20,000,000— (A) The application of earned value management is optional and is a risk-based decision; (B) A decision to apply earned value management shall be documented in the contract file; and (C) Follow the procedures at PGI 234.201(1)(iii) for conducting a cost-benefit analysis.
      (iv) For firm-fixed-price contracts and subcontracts of any dollar value— (A) The application of earned value management is discouraged; and (B) Follow the procedures at PGI 234.201(1)(iv) for obtaining a waiver before applying earned value management.

    DFARS 234.203 – Solicitation provisions and contract clause
    For cost or incentive contracts valued at $20,000,000 or more, and for other contracts for which EVMS will be applied in accordance with 234.201(1)(iii) and (iv)—
      (2) Use the clause at 252.234-7002, Earned Value Management System, … in the solicitation and contract.

    DFARS 252.234-7002, Earned Value Management System
    (a) In the performance of this contract, the Contractor shall use
      (1) An Earned Value Management System (EVMS) that complies with the EVMS guidelines in the American National Standards Institute/Electronic Industries Alliance Standard 748, Earned Value Management Systems (ANSI/EIA-748); and
      (2) Management procedures that provide for generation of timely, reliable, and verifiable information for the Contract Performance Report (CPR) and the Integrated Master Schedule (IMS) required by the CPR and IMS data items of this contract.

    2. Question: “When and why was this clause deleted (DFARS 252.242-7005)?”
    Response: As documented in reference 1.B above, this clause was deleted from DFARS on 23 Apr 2008 in Federal Register notice FR Doc E8-8706.  This clause and the associated C/SSR were deleted from the DFARS as part of an overall restructuring by DoD of the requirements applied to contractor Earned Value Management Systems as described in references 1.A and 1.B above.  The objective of this EVMS restructuring was to streamline, improve, and increase consistency in earned value management implementation and application.

    3. Question: “If it was deleted, is there still a need to continue to do the report?”
    Response: Continued use of the C/SSR is only applicable to contracts containing clause DFARS 252.242-7005 that existed before the issuance of the EVMS Final Rule in FR Doc E8-8706 and that have not yet completed their performance periods, assuming that any such contracts have not been subsequently modified to comply with current EVMS requirements.

    4. Question: “Was it replaced with another provision? Was the C/SSR replaced with another report?”
    Response: Pursuant to DFARS 234.203(2), clause DFARS 252.234-7002 is now used in any contract that is subject to EVMS requirements in accordance with DFARS 234.201(1). Pursuant to this clause, the Contract Performance Report (CPR) is now used to obtain cost and schedule performance information in any contract that requires compliance with ANSI/EIA-748.


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