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<ph props="autonumber" class="- topic/ph ">(a)</ph>
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<i class="+ topic/ph hi-d/i ">General</i>. The Contractor is encouraged to develop, prepare, and submit value engineering change proposals (VECP
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<i class="+ topic/ph hi-d/i ">General</i>. The Contractor is encouraged to develop, prepare, and submit value engineering change proposals (VECP's) voluntarily. The Contractor shall share in any net acquisition savings realized from accepted VECP's, in accordance with the incentive sharing rates in paragraph (f) of this clause.</p>
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class="+ topic/ph hi-d/i ">Acquisition savings</i>, as used in this clause, means savings resulting from the application of a VECP to contracts awarded by the same contracting office or its successor for essentially the same unit. Acquisition savings include-<ol id="d3704e59" class="- topic/ol ">
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<ph props="autonumber" class="- topic/ph ">(1)</ph> Instant contract savings, which are the net cost reductions on this, the instant contract, and which are equal to the instant unit cost reduction multiplied by the number of instant contract units affected by the VECP, less the Contractor
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<ph props="autonumber" class="- topic/ph ">(1)</ph> Instant contract savings, which are the net cost reductions on this, the instant contract, and which are equal to the instant unit cost reduction multiplied by the number of instant contract units affected by the VECP, less the Contractor's allowable development and implementation costs;</p>
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class="+ topic/ph hi-d/i ">Collateral savings</i>, as used in this clause, means those measurable net reductions resulting from a VECP in the agency
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class="+ topic/ph hi-d/i ">Collateral savings</i>, as used in this clause, means those measurable net reductions resulting from a VECP in the agency's overall projected collateral costs, exclusive of acquisition savings, whether or not the acquisition cost changes.</p>
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class="+ topic/ph hi-d/i ">Contracting office</i> includes any contracting office that the acquisition is transferred to, such as another branch of the agency or another agency
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class="+ topic/ph hi-d/i ">Contracting office</i> includes any contracting office that the acquisition is transferred to, such as another branch of the agency or another agency's office that is performing a joint acquisition action.</p>
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class="+ topic/ph hi-d/i ">Contractor
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class="+ topic/ph hi-d/i ">Contractor's development and implementation costs</i>, as used in this clause, means those costs the Contractor incurs on a VECP specifically in developing, testing, preparing, and submitting the VECP, as well as those costs the Contractor incurs to make the contractual changes required by Government acceptance of a VECP.</p>
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class="+ topic/ph hi-d/i ">Government costs</i>, as used in this clause, means those agency costs that result directly from developing and implementing the VECP, such as any net increases in the cost of testing, operations, maintenance, and logistics support. The term does not include the normal administrative costs of processing the VECP or any increase in this contract
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class="+ topic/ph hi-d/i ">Government costs</i>, as used in this clause, means those agency costs that result directly from developing and implementing the VECP, such as any net increases in the cost of testing, operations, maintenance, and logistics support. The term does not include the normal administrative costs of processing the VECP or any increase in this contract's cost or price resulting from negative instant contract savings.</p>
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class="+ topic/ph hi-d/i ">Instant unit cost reduction</i> means the amount of the decrease in unit cost of performance (without deducting any Contractor
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class="+ topic/ph hi-d/i ">Instant unit cost reduction</i> means the amount of the decrease in unit cost of performance (without deducting any Contractor's development or implementation costs) resulting from using the VECP on this, the instant contract. If this is a service contract, the instant unit cost reduction is normally equal to the number of hours per line-item task saved by using the VECP on this contract, multiplied by the appropriate contract labor rate.</p>
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class="+ topic/ph hi-d/i ">Negative instant contract savings</i> means the increase in the cost or price of this contract when the acceptance of a VECP results in an excess of the Contractor
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class="+ topic/ph hi-d/i ">Negative instant contract savings</i> means the increase in the cost or price of this contract when the acceptance of a VECP results in an excess of the Contractor's allowable development and implementation costs over the product of the instant unit cost reduction multiplied by the number of instant contract units affected.</p>
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<ph props="autonumber" class="- topic/ph ">(2)</ph> Results in reducing the overall projected cost to the agency without impairing essential functions or characteristics;<i class="+ topic/ph hi-d/i ">provided</i>, that it does not involve a change
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<ph props="autonumber" class="- topic/ph ">(2)</ph> Results in reducing the overall projected cost to the agency without impairing essential functions or characteristics;<i class="+ topic/ph hi-d/i ">provided</i>, that it does not involve a change—</p>
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<ph props="autonumber" class="- topic/ph ">(1)</ph>
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A description of the difference between the existing contract requirement and the proposed requirement, the comparative advantages and disadvantages of each, a justification when an item
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A description of the difference between the existing contract requirement and the proposed requirement, the comparative advantages and disadvantages of each, a justification when an item's function or characteristics are being altered, the effect of the change on the end item's performance, and any pertinent objective test data.</p>
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<ph props="autonumber" class="- topic/ph ">(4)</ph>
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A separate, detailed cost estimate for (i) the affected portions of the existing contract requirement and (ii) the VECP. The cost reduction associated with the VECP shall take into account the Contractor
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A separate, detailed cost estimate for (i) the affected portions of the existing contract requirement and (ii) the VECP. The cost reduction associated with the VECP shall take into account the Contractor's allowable development and implementation costs, including any amount attributable to subcontracts under the Subcontracts paragraph of this clause.</p>
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<ph props="autonumber" class="- topic/ph ">(d)</ph>
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<i class="+ topic/ph hi-d/i ">Submission</i>. The Contractor shall submit VECP
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<i class="+ topic/ph hi-d/i ">Submission</i>. The Contractor shall submit VECP's to the Contracting Officer, unless this contract states otherwise. If this contract is administered by other than the contracting office, the Contractor shall submit a copy of the VECP simultaneously to the Contracting Officer and to the Administrative Contracting Officer.</p>
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<ph props="autonumber" class="- topic/ph ">(1)</ph>
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The Contracting Officer will notify the Contractor of the status of the VECP within 45 calendar days after the contracting office receives it. If additional time is required, the Contracting Officer will notify the Contractor within the 45-day period and provide the reason for the delay and the expected date of the decision. The Government will process VECP
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The Contracting Officer will notify the Contractor of the status of the VECP within 45 calendar days after the contracting office receives it. If additional time is required, the Contracting Officer will notify the Contractor within the 45-day period and provide the reason for the delay and the expected date of the decision. The Government will process VECP's expeditiously; however, it will not be liable for any delay in acting upon a VECP.</p>
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<ph props="autonumber" class="- topic/ph ">(3)</ph>
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Any VECP may be accepted, in whole or in part, by the Contracting Officer
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Any VECP may be accepted, in whole or in part, by the Contracting Officer's award of a modification to this contract citing this clause and made either before or within a reasonable time after contract performance is completed. Until such a contract modification applies a VECP to this contract, the Contractor shall perform in accordance with the existing contract. The decision to accept or reject all or part of any VECP is a unilateral decision made solely at the discretion of the Contracting Officer.</p>
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<ph props="autonumber" class="- topic/ph ">(f)</ph>
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<i class="+ topic/ph hi-d/i ">Sharing rates</i>. If a VECP is accepted, the Contractor shall share in net acquisition savings according to the percentages shown in the table below. The percentage paid the Contractor depends upon
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<i class="+ topic/ph hi-d/i ">Sharing rates</i>. If a VECP is accepted, the Contractor shall share in net acquisition savings according to the percentages shown in the table below. The percentage paid the Contractor depends upon—</p>
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<ph props="autonumber" class="- topic/ph ">(1)</ph>
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This contract
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This contract's type (fixed-price, incentive, or cost-reimbursement);</p>
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<p class="- topic/p ">Contractor
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<p class="- topic/p ">Contractor's Share of Net Acquisition Savings (Figure in Percent)</p>
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class="- topic/entry ">* The Contracting Office may increase the Contractor
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class="- topic/entry ">* The Contracting Office may increase the Contractor's sharing rate to as high as 75 percent for each VECP.</entry>
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class="- topic/entry ">** Same sharing arrangement as the contract
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class="- topic/entry ">** Same sharing arrangement as the contract's profit or fee adjustment formula.</entry>
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class="- topic/entry ">*** The Contracting Office may increase the Contractor
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class="- topic/entry ">*** The Contracting Office may increase the Contractor's sharing rate to as high as 50 percent for each VECP.</entry>
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<ph props="autonumber" class="- topic/ph ">(2)</ph>
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Except in incentive contracts, Government costs and any price or cost increases resulting from negative instant contract savings shall be offset against acquisition savings each time such savings are realized until they are fully offset. Then, the Contractor
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Except in incentive contracts, Government costs and any price or cost increases resulting from negative instant contract savings shall be offset against acquisition savings each time such savings are realized until they are fully offset. Then, the Contractor's share is calculated by multiplying net acquisition savings by the appropriate Contractor's percentage sharing rate (see paragraph (f) of this clause). Additional Contractor shares of net acquisition savings shall be paid to the Contractor at the time realized.</p>
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<ph props="autonumber" class="- topic/ph ">(4)</ph>
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If the Government does not receive and accept all items on which it paid the Contractor
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If the Government does not receive and accept all items on which it paid the Contractor's share, the Contractor shall reimburse the Government for the proportionate share of these payments.</p>
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<ph props="autonumber" class="- topic/ph ">(h)</ph>
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<i class="+ topic/ph hi-d/i ">Contract adjustment</i>. The modification accepting the VECP (or a subsequent modification issued as soon as possible after any negotiations are completed) shall
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<i class="+ topic/ph hi-d/i ">Contract adjustment</i>. The modification accepting the VECP (or a subsequent modification issued as soon as possible after any negotiations are completed) shall—</p>
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<ph props="autonumber" class="- topic/ph ">(3)</ph>
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Specify the Contractor
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Specify the Contractor's dollar share per unit on future contracts, or provide the lump-sum payment;</p>
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<ph props="autonumber" class="- topic/ph ">(5)</ph>
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Provide the Contractor
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Provide the Contractor's share of any net acquisition savings under the instant contract in accordance with the following:</p>
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Payments of the Contractor
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Payments of the Contractor's share of concurrent and future contract savings shall be made by a modification to the instant contract in accordance with paragraph (h)(5) of this clause. For incentive contracts, shares shall be added as a separate firm-fixed-price line item on the instant contract. The Contractor shall maintain records adequate to identify the first delivered unit for 3 years after final payment under this contract.</p>
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The Contracting Officer shall calculate the Contractor
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The Contracting Officer shall calculate the Contractor's share of concurrent contract savings by—</p>
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Multiplying the result by the Contractor
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Multiplying the result by the Contractor's sharing rate.</p>
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</ol>
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<p class="- topic/p " id="d3748e417">
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<ph props="autonumber" class="- topic/ph ">(3)</ph>
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-
The Contracting Officer shall calculate the Contractor
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+
The Contracting Officer shall calculate the Contractor's share of future contract savings by—</p>
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<ol id="d3704e756" class="- topic/ol ">
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<p class="- topic/p " id="d3748e423">
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@@ -546,14 +546,14 @@
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<p class="- topic/p " id="d3748e433">
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<ph props="autonumber" class="- topic/ph ">(iii)</ph>
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-
Multiplying the result by the Contractor
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+
Multiplying the result by the Contractor's sharing rate.</p>
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<p class="- topic/p " id="d3748e438">
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<ph props="autonumber" class="- topic/ph ">(4)</ph>
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-
When the Government wishes and the Contractor agrees, the Contractor
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+
When the Government wishes and the Contractor agrees, the Contractor's share of future contract savings may be paid in a single lump sum rather than in a series of payments over time as future contracts are awarded. Under this alternate procedure, the future contract savings may be calculated when the VECP is accepted, on the basis of the Contracting Officer's forecast of the number of units that will be delivered during the sharing period. The Contractor's share shall be included in a modification to this contract (see paragraph (h)(3) of this clause) and shall not be subject to subsequent adjustment.</p>
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<p class="- topic/p " id="d3748e443">
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<p class="- topic/p " id="d3748e464">
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<ph props="autonumber" class="- topic/ph ">(j)</ph>
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583
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-
<i class="+ topic/ph hi-d/i ">Collateral savings</i>. If a VECP is accepted, the Contracting Officer will increase the instant contract amount, as specified in paragraph (h)(5) of this clause, by a rate from 20 to 100 percent, as determined by the Contracting Officer, of any projected collateral savings determined to be realized in a typical year of use after subtracting any Government costs not previously offset. However, the Contractor
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+
<i class="+ topic/ph hi-d/i ">Collateral savings</i>. If a VECP is accepted, the Contracting Officer will increase the instant contract amount, as specified in paragraph (h)(5) of this clause, by a rate from 20 to 100 percent, as determined by the Contracting Officer, of any projected collateral savings determined to be realized in a typical year of use after subtracting any Government costs not previously offset. However, the Contractor's share of collateral savings will not exceed the contract's firm-fixed-price, target price, target cost, or estimated cost, at the time the VECP is accepted, or $100,000, whichever is greater. The Contracting Officer will be the sole determiner of the amount of collateral savings.</p>
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<p class="- topic/p " id="d3748e471">
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@@ -593,17 +593,17 @@
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593
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<i class="+ topic/ph hi-d/i ">Subcontracts</i>. The Contractor shall include an appropriate value engineering clause in any subcontract-valued at or above the simplified acquisition threshold, as defined in FAR <xref href="2.101.dita#FAR_2_101"
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base="i1125359"
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outputclass="fm:ParaNumOnly"
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-
class="- topic/xref ">2.101</xref> on the date of subcontract award, and may include one in subcontracts of lesser value. In calculating any adjustment in this contract
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+
class="- topic/xref ">2.101</xref> on the date of subcontract award, and may include one in subcontracts of lesser value. In calculating any adjustment in this contract's price for instant contract savings (or negative instant contract savings), the Contractor's allowable development and implementation costs shall include any subcontractor's allowable development and implementation costs, and any value engineering incentive payments to a subcontractor, clearly resulting from a VECP accepted by the Government under this contract. The Contractor may choose any arrangement for subcontractor value engineering incentive payments, <i class="+ topic/ph hi-d/i ">provided</i>, that the payments shall not reduce the Government's share of concurrent or future contract savings or collateral savings.</p>
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<li class="- topic/li ">
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<p class="- topic/p " id="d3748e492">
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<ph props="autonumber" class="- topic/ph ">(m)</ph>
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601
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-
<i class="+ topic/ph hi-d/i ">Data</i>. The Contractor may restrict the Government
|
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602
|
-
<p class="- topic/p " id="d3748e498">These data, furnished under the Value Engineering clause of contract ________, shall not be disclosed outside the Government or duplicated, used, or disclosed, in whole or in part, for any purpose other than to evaluate a value engineering change proposal submitted under the clause. This restriction does not limit the Government
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+
<i class="+ topic/ph hi-d/i ">Data</i>. The Contractor may restrict the Government's right to use any part of a VECP or the supporting data by marking the following legend on the affected parts:</p>
|
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602
|
+
<p class="- topic/p " id="d3748e498">These data, furnished under the Value Engineering clause of contract ________, shall not be disclosed outside the Government or duplicated, used, or disclosed, in whole or in part, for any purpose other than to evaluate a value engineering change proposal submitted under the clause. This restriction does not limit the Government's right to use information contained in these data if it has been obtained or is otherwise available from the Contractor or from another source without limitations.</p>
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<p class="- topic/p " id="d3748e500">If a VECP is accepted, the Contractor hereby grants the Government unlimited rights in the VECP and supporting data, except that, with respect to data qualifying and submitted as limited rights technical data, the Government shall have the rights specified in the contract modification implementing the VECP and shall appropriately mark the data. (The terms "unlimited rights" and "limited rights" are defined in <xref href="Part_27.dita#FAR_Part_27"
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base="i1090283"
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outputclass="fm:Part"
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-
class="- topic/xref ">part
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+
class="- topic/xref ">part 27</xref> of the Federal Acquisition Regulation.)</p>
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</li>
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</ol>
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<p outputclass="Endofclause" class="- topic/p ">(End of clause)</p>
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@@ -611,13 +611,13 @@
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<p class="- topic/p " id="d3744e509">
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<i class="+ topic/ph hi-d/i ">Alternate I </i>
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<ph outputclass="SmCaps">(Apr 1984)</ph>. If the contracting officer selects a mandatory value engineering program requirement, substitute the following paragraph (a) for paragraph (a) of the basic clause:</p>
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614
|
-
<p outputclass="List1" class="- topic/p ">(a) <i class="+ topic/ph hi-d/i ">General</i>. The Contractor shall (1) engage in a value engineering program, and submit value engineering progress reports, as specified in the Schedule and (2) submit to the Contracting Officer any resulting value engineering change proposals (VECP
|
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|
+
<p outputclass="List1" class="- topic/p ">(a) <i class="+ topic/ph hi-d/i ">General</i>. The Contractor shall (1) engage in a value engineering program, and submit value engineering progress reports, as specified in the Schedule and (2) submit to the Contracting Officer any resulting value engineering change proposals (VECP's). In addition to being paid as the Schedule specifies for this mandatory program, the Contractor shall share in any net acquisition savings realized from accepted VECP's, in accordance with the program requirement sharing rates in paragraph (f) of this clause.</p>
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<?FM MARKER [Alt] End?>
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<?FM MARKER [Alt] Start?>
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<p class="- topic/p " id="d3744e522">
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|
<i class="+ topic/ph hi-d/i ">Alternate II </i>
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619
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<ph outputclass="SmCaps">(Jan 2015)</ph>. If the contracting officer selects both a value engineering incentive and mandatory value engineering program requirement, substitute the following paragraph (a) for paragraph (a) of the basic clause:</p>
|
|
620
|
-
<p outputclass="List1" class="- topic/p ">(a) <i class="+ topic/ph hi-d/i ">General</i>. For those line items designated in the Schedule as subject to the value engineering program requirement, the Contractor shall (1) engage in a value engineering program, and submit value engineering progress reports, as specified in the Schedule and (2) submit to the Contracting Officer any resulting VECP
|
|
620
|
+
<p outputclass="List1" class="- topic/p ">(a) <i class="+ topic/ph hi-d/i ">General</i>. For those line items designated in the Schedule as subject to the value engineering program requirement, the Contractor shall (1) engage in a value engineering program, and submit value engineering progress reports, as specified in the Schedule and (2) submit to the Contracting Officer any resulting VECP's. In addition to being paid as the Schedule specifies for this mandatory program, the Contractor shall share in any net acquisition savings realized from VECP's accepted under the program, in accordance with the program requirement sharing rates in paragraph (f) of this clause. For remaining areas of the contract, the Contractor is encouraged to develop, prepare, and submit VECP's voluntarily; for VECP's accepted under these remaining areas, the incentive sharing rates apply. The decision on which rate applies is a unilateral decision made solely at the discretion of the Government.</p>
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<?FM MARKER [Alt] End?>
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<?FM MARKER [Alt] Start?>
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<p class="- topic/p " id="d3744e535">
|