ONR: The Closeout Process

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ONR The Closeout Process
Presented By C.C. Everley ONR
Seattle Regional Office April
2008 DISTRIBUTION STATEMENT C Approved
distribution authorized to U.S. Government
agencies and their contractors Administrative Or
Operational Use 28 APR 2008
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ONRs Regional Offices
SEATTLE ATLANTA CHICAGO SAN DIEGO
BOSTON
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• The information to be presented can be found at
  www.onr.navy.mil
• Title ONR UBA Closeout of Contracts and Grants

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ONR The Closeout Process

• General overview of the closeout process,
  policies and procedures
• Details about deliverables and other actions
  unique to the closeout process
• Forms, instructions and web-based guidance and
  links

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What is closeout? It is a layered process

1. The process of documenting and assuring the
   fulfillment of the terms and conditions of the
   award
2. Of certifying awardees compliance with applicable
   regulations and terms and conditions.
3. Making final disposition of all award
   by-products, such as final vouchers, reports,
   patent disclosures and property.

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Why is Closeout important?

• Government acceptance of the final deliverables
  and reports is critical to the overall success of
  the project. In many instances, this act of
  final acceptance can cause the release of final
  payments to the awardee, and ultimately lead to
  release of the awardee from lingering obligations
  under the award.

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• Contract closeout is the most unheralded phase
  of the procurement process, yet, when performed
  efficiently and effectively, it can protect the
  governments interests and free up significant
  dollars for current-year program priorities.
• From ESI Intl Contracting Programs Catalog
  2005-2006

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Differences

• Contracts
• FAR 4.804-5
• Certification of final costs
• Small Business requirements

• Assistance Awards
• DoDGARS
• http//www.dtic.mil/whs/directives/corres/html/32
  106r.htm
• NASA Grant Handbook

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PURPOSE OF CLOSEOUT IS TO ENSURE THAT

• 1. Awardee has complied with the terms and
  conditions
• set forth in the award, including timely
  submission of
• the deliverables
• 2. Disposition of classified information is
  completed
• 3. Final patent and technical reports are
  accepted by the
• agency
• 4. Plant and property clearance received and all
  property
• is fully dispositioned

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PURPOSE IS TO ENSURE THAT

• 5. Final costs have been reviewed and accepted,
  any disallowed
• costs are settled including
• gtSubcontract settlement/closeouts
• gtOpen year indirect cost rates
• gtSubmission of final invoice
• gtDe-obligation of funds completed (for which
• we have delegation) or recommended to
• the buying agency
• 6. Small Business requirements have been
  fulfilled

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Types of Delegations

• ONR services all of DoD, as well as non DoD
  customers (NIH, NASA, DOI, etc.)
• Functions performed depend on the delegation we
  receive from the buying command
• Some delegations we have
• Full delegation (Most DoD)
• Property and Closeout (Most NASA)
• Voucher only
• Property only (NIH)

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Award-Specific Terms Conditions

• EACH AWARD IS DIFFERENT
• A thorough knowledge of specific terms and
  conditions, especially relating to final
  deliverable requirements is a prerequisite for a
  complete understanding of the closeout process

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• Contracts
• FAR 52 provisions provide detailed procedures for
  contract closeout
• DFARS, NMCARS
• Grants Cooperative Agreements
• DoD Grant and Agreement Regulations (DoDGARs)
  provides procedures for assistance instruments
• Also, OMB Circular A-110 Subpart D After-the
  Award-Requirements provides additional guidance
• NASA Awards
• NASA Grant Handbook provides assistance for NASA
  awards
• Other agencies (i.e. Army/Air Force) have their
  own terms and conditions

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Role of the ONR ACO/AGO(Administrative
Grants/Contracting Officer)

• With the help of other staff members
• Solicit the awardee for the required
  deliverables, including providing any forms,
  guidance or other counsel relative to the
  closeout process
• Ensure that the submittals meet the
  administrative requirements of the terms and
  conditions of the award
• Distribution was correct, in the correct format
  etc.

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AGO/ACO Role Continued..

• Contact and follow up with issuing
  agency/procurement offices following submittal to
  gain acceptance or facilitate necessary changes
  to the deliverables
• Conduct formal administrative closeout of the
  award, including completion of relevant forms,
  certifications and releases, review and
  acceptance of final cost reports and
  certification of final vouchers

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When does ONR start the Process?

• Once the award is physically complete, e.g., the
  period of performance has expired, the clock
  begins ticking for submission by the awardee of
  final deliverables required for the award
• Often the awardee is notified via e-mail that the
  award has expired and is reminded of the
  deliverables required and due date

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Awardees Responsibilities

• Make sure that all reports are sent to the
  correct people/agencies
• Generally, awards will include instructions
  relative to the distribution of each deliverable
  including number of copies and mailing addresses

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Helpful Tool.

• AdminWeb
• Database for awardees to submit reports

Can be found at http//www.onr.navy.mi
l/
Can be found at http//www.onr.navy.mi
l/
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Typical Deliverables and Due Dates
In General Final Technical Reporting 90 days
after expiration Final Patent Reporting 90 days
after expiration Final Cost Reporting 90 days
after expiration Final Property Reporting 90
days after expiration Final Security
Reporting 90 days after expiration Final Small
Business Reporting 30 days after expiration
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Helpful Tool.

• All required documents can be found on the ONR
  website
• http//www.onr.navy.mil/

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Final Technical Report

• Usually due by 90 days after award
  expiration-check award terms and conditions for
  clarification and required distribution
• Format contractor/recipient can use any format
  acceptable to the awarding agency. They should
  contact the Program Manager if questions arise.
• Include form SF 298 Report Documentation Page
• Acceptance is provided by awarding agency

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Technical PerformanceDD 250 (For some contracts)

• DD 250 Material Inspection and Receiving Report
• Instructions will be noted in Section E and/or in
  the CDRL (Contracts Data Requirements Listing)
  in the contract.
• Acceptance is provided by awarding agency

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Final Patent Report

• Form DD 882

Acceptance is provided by awarding agency
Patent reports are usually required even if
they are negative
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Final Cost Reporting

• Assistance Awards
• DoD Form SF 269
• NASA Form SF 272

• Contracts
• Voucher Form
• SF1034/SF 1035
• Also need to submit Contractors Release and
  Assignment forms

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Final Property Reporting

• The final property reports are generally
  concerned with where title to property vests-
  i.e. with the Government or the recipient.
• Forms Used
• DoD DD 1662 (soon to be obsolete)
• NASA Contracts NASA form 1018
• Grants Letter with signature (e-mail in some
  instances) will suffice for negative reports or
  for instances where title vests with the
  recipient.

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ACO Role in Final Property Reporting

• Vesting of Title Determination
• Coordinate Disposition of Property with Plant
  Clearance Officer
• Reporting of the Property Closeout Process to
  interested parties

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Final Security Closeout
Government obtains awardee certification
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What is Acceptance of a Final Report?

• Definition of acceptance FAR 46.101
• Acceptance can take many different forms and is
  driven by the type of award and the individual
  terms and conditions.
• Common forms of acceptance
• Government correspondence indicating or
  certifying acceptable final deliverables or
  performance
• DD 250-Material and Acceptance Report (most often
  used in cost-type or fixed fee contracts)
• Electronic communication from Program Managers

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Administrative Contracting OfficerDuties in
Accepting Final Costs

• The ONR ACO/AGO will conduct a final financial
  review of the costs incurred under a given award,
  to ensure that all costs are reasonable,
  allocable, and allowable. This review may take
  the form of
• Primary reliance on the OMB Circular A-133
  financial audit which characterizes the overall
  abilities of the awardees management control and
  incurred cost systems. The audits are generally
  performed by an independent auditor and reviewed
  by the cognizant audit agency.

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Additional Forms of Cost Acceptance When Needed

• A desk review, where cost elements originally
  budgeted in the proposal are compared and
  contrasted with those costs actually incurred
• A full audit of the individual award, as
  conducted by the cognizant federal agency for
  audit of the awardees institution, either
  Department of Health and Human Services or
  Defense Contract Audit Agency. These are
  generally reserved for high-dollar awards.

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Cost Acceptance/Non-Acceptance

• During the financial review process, the ACO/AGO
  may disallow or accept final costs, and will
  execute the final completion voucher releasing
  any residual payments still due
• He or she will also execute several forms
  internal to the government, including a final
  contract/grant completion statement summarizing
  the acceptance of final deliverables. The forms
  will be sent to the awarding agency for final
  actions that are needed
• Award will be administratively closed for all
  functions that were delegated

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Quick Closeout(For Contracts Only)

• Reference FAR 42.708
• Only applies to finalization of provisional
  indirect rates on cost contracts (not necessary
  when rates are already fixed or predetermined)
• Usually more applicable to major cost type
  subcontracts awarded to for-profit entities under
  non-profit/university prime contracts

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Quick Closeout(For Contracts Only)

• Maximum indirect cost allocation to one contract
  using QC is 1 million total indirect cost
   allocations per FY to all contracts using QC
  cannot exceed 15 of total indirect costs
  allocated to all cost contracts
• Contact ONR ACO for guidance/coordination for
  either potential prime or subcontract
  application.

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Impact of Prioritizing Closeouts

• Reduced backlog of expired awards by 45
• Reduced age of old dogs by 50
• Achieved active/expired ratio of 75 / 25
• Currently operating in maintenance mode

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Collaborative Workspace
Firewall
Collaborative Workspace
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Whats in The Future

• Public Law 106-107
• Grants Streamlining
• Electronic Reporting Systems Across Agencies

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My Contact Information

• C.C. Everley
• everlec_at_onr.navy.mil
• [phone]