Partnering for Construction Contracts

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1836 and 1852

Partnering for Construction Contracts

AGENCY: Office of Procurement, Contract Management Division, National

Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: This final rule amends NASA's Federal Acquisition Regulation

Supplement (NFS) to set forth a clause to be used to promote partnering

under construction contracts when it is determined that the benefits to

be derived exceed the costs.

EFFECTIVE DATE: August 18, 1998.

FOR FURTHER INFORMATION CONTACT: Mr. Joseph Le Cren, Telephone: (202)

358-0444.

SUPPLEMENTARY INFORMATION:

Background

On April 29, 1998, a proposed rule to amend the NFS to establish a

clause to promote the use of partnering under construction contracts

was published in the Federal Register (63 FR 23414-23415) for comment.

The clause is to be included in construction contracts when a

determination is made that the benefits to be derived exceed the costs.

Comments were submitted by only one commenter. The commenter believes

the proposed rule is not strong enough since it neither makes

partnering mandatory for construction contracts, nor does it make

mandatory participation by all subcontractors and the architect and

design contractor under a construction contract. The comments were

reviewed and considered; however, no changes were made to the proposed

rule.

Impact

NASA certifies that this regulation will not have a significant

economic effect on a substantial number of small entities under the

Regulatory Flexibility Act (5 U.S.C. 601 et. seq.) because it

establishes a voluntary communication program applicable only to

construction contracts. This rule does not impose any reporting or

record keeping requirements subject to the Paperwork Reduction Act.

List of Subjects in 48 CFR Parts 1836 and 1852

Government procurement.

Tom Luedtke,

Deputy Associate Administrator for Procurement.

Accordingly, 48 CFR 1836 and 1852 are amended as follows:

1. The authority citation for 48 CFR Parts 1836 and 1852 continues

to read as follows:

Authority: 42 U.S.C. 2473(c)(1).

PART 1836--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

1836.70 [Added]

2. Subpart 1836.70 is added to read as follows:

Subpart 1836.70 Partnering

1836.7001 Definition.

1836.7002 General.

1836.7003 Policy.

1836.7004 NASA solicitation provision and contract clause.

1836.70 Partnering.

1836.7001 Definition.

Partnering means a relationship of open communication and close

cooperation that involves both Government and Contractor personnel

working together for the purpose of establishing a mutually beneficial,

proactive, cooperative environment within which to achieve contract

objectives and resolve issues and implementing actions as required.

1836.7002 General.

(a) The establishment of a partnering environment usually leads to

higher quality products completed more

[[Page 44171]]

quickly at lower overall costs and with fewer accidents and litigation.

(b) The use of partnering is encouraged as it has been shown to

reduce the average contract cost and schedule growth and to reduce

contract claims and litigation.

(c) Partnering is a voluntary contract relationship within the

management process that is not to be used to unofficially alter terms

of the contract.

1836.7003 Policy.

(a) Partnering should be used on a contract when the contracting

officer, in coordination with the project manager, determines that the

benefits to be achieved from its use are expected to be greater than

the costs.

(b) In determining whether the benefits of partnering are greater

than the costs, the following factors should be considered:

(1) The estimated dollar value of the contract;

(2) The complexity of the work to be performed;

(3) The contemplated length of the contract; and

(4) The estimated costs to be incurred in conducting the

partnership development and team building initial and follow-up

workshops.

1836.7004 NASA solicitation provision and contract clause.

The contracting officer may insert a clause substantially the same

as stated at 1852.236-75, Partnering for Construction Contracts, in

solicitations and contracts for construction, when it has been

determined in accordance with 1836.7003 that the benefits to be derived

from partnering exceed the costs.

PART 1852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

1852.236-75 [Added]

3. Section 1852.236-75 is added to read as follows:

1852.236-75 Partnering for construction contracts.

As prescribed in 1836.7004, insert the following clause:

Partnering for Construction Contracts--August 1998

(a) The terms ``partnering'' and ``partnership'' used herein

shall mean a relationship of open communication and close

cooperation that involves both Government and Contractor personnel

working together for the purpose of establishing a mutually

beneficial, proactive, cooperative environment within which to

achieve contract objectives and resolve issues and implementing

actions as required.

(b) Partnering will be a voluntary commitment mutually agreed

upon by at least NASA and the prime contractor, and preferably the

subcontractors and the A&E design contractor, if applicable.

Sustained commitment to the process is essential to assure success

of the relationship.

(c) NASA intends to facilitate contract management by

encouraging the foundation of a cohesive partnership with the

Contractor, its subcontractors, the A&E design contractor, and

NASA's contract management staff. This partnership will be

structured to draw on the strengths of each organization to identify

and achieve mutual objectives. The objectives are intended to

complete the contract requirements within budget, on schedule, and

in accordance with the plans and specifications.

(d) To implement the partnership, it is anticipated that within

30 days of the Notice to Proceed the prime Contractor's key

personnel, its subcontractors, the A&E design contractor, and NASA

personnel will attend a partnership development and team building

workshop. Follow-up team building workshops will be held

periodically throughout the duration of the contract as agreed to by

the Government and the Contractor.

(e) Any cost with effectuating the partnership will be agreed to

in advance by both parties and will be shared with no change in the

contract price. The contractor's share of the costs are not

recoverable under any other Government award.

(End of clause)

[FR Doc. 98-22023 Filed 8-17-98; 8:45 am]

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