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You are here: Home / Government Contracting News / Pentagon proposes analytics tool for awarding performance-based contracts

February 3, 2012 By AMK

Pentagon proposes analytics tool for awarding performance-based contracts

The Defense Department is proposing a new rule requiring contracting officers to use an analytics tool when awarding performance-based contracts, according to the Jan. 30, 2012 edition  of the Federal Register.

The tool is a cash-flow model for evaluating alternative financing arrangements. Contracting officers would use the tool when considering performance-based payments on new fixed-price contract awards.

The requirement would apply to solicitations made on or after July 1, 2011. Prior to using performance-based payments, the contracting officer would be required to:

  • § Agree with the offer on price using customary progress payments before negotiation begins
  • § Use the new analytics tool to analyze the performance-based payments schedule

Under the proposed rule, if performance-based payments are desired, the contractor would submit a proposed performance-based payments schedule that includes:

  • § Payment events
  • § Completion criteria
  • § Event values
  • § An expected expenditure profile

The Pentagon is accepting comments on the proposed rule through March 30, 2012.

— reprinted from Executive Gov, appearing on Jan. 30, 2012 at http://www.executivegov.com/2012/01/pentagon-proposes-analytics-tool-for-awarding-performance-based-contracts/.

Filed Under: Government Contracting News Tagged With: contract payments, performance, performance-based payment

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