UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
FB I I 1993
OSWER Directive #9202.1-09
MEMORANDUM
SUBJECT: Guidance on Program
FROM:
omce OF
AOMHISTRATION
AM) RESOURCES
ctivities Ur der ARCS
Richard Guimond
Assistant Surgeon GeneralMJSPH
Deputy Assistant Administrator
Office of Solid Waste a/io) Emergen
'SallyanneJ^irper, Depu
for Finance and Acquisition
Response
ssistant Administrator
TO:
ARCS Contracting Officers and Project Officers
I. BACKGROUND/PURPOSE
In July 1991, Administrator Reilly established a task force of senior EPA
managers and analysts to address concerns regarding the Agency's Alternative
Remedial Contracting Strategy (ARCS) contracts. In the area of program
management the task force made six specific recommendations. This guidance
document addresses two of those recommendations: 1) division of program
management costs into administrative support costs and technical cleanup
costs and 2) development of guidance on cost management activities. The
guidance is to be implemented beginning with ARCS contract invoices
submir.ed for March, 1993.
In order to improve the ability of the Government to track program
management costs, the task force directed that all costs currently characterized
as program management costs be segregated into two functional areas.
administrative support costs and technical cleanup costs. Section II of this
guidance addresses this recommendation.
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The task force also directed that the Agency develop guidance on cost
management activities that would assist the Regions in their efforts to control
program management costs. Sections III through V address this recommenda-
tion.
Finally, Section VI provides specific instructions which will implement the
recommendations.
Whereas this guidance u.ovides direction on segregating program
management costs, it should be noted that during contract negotiations
contractors were encouraged to maximize site-specific program management
wherever such costs could be legitimately associated with a single site. This
should continue to be encouraged.
II. SEGREGATING PROGRAM MANAGEMENT COSTS
Each ARCS contract provides for the delivery of architect/engineering
services for the remediation of hazardous waste sites. The contracts provide
for two centers against which all costs will be reimbursed (excluding the Special
Subcontracting Pool for Construction). The first cost center is designated as
remedial planning activities and consists of all site-specific contract costs, that
is, all cost directly associated with activities on specific hazardous waste sites
assigned to the ARCS contractor for remediation. The second cost center is
designated as program management activities which consist of all non-site
specific contract costs. Typically, program management costs support and
benefit the remedial sites on which a contractor is performing in the aggregate
but cannot be attributed to a specific site.
Prooram Management, as define* in the ARCS contracts, "is teemed to
constitute those technical, management, administrative, clerical and secretarial
activities to be performed by the Program Management Office (PMO) and those
support functions to be performed by the corporate office which are allocable
to the PMO."
Currently, program management costs are tracked and reported on the
basis of an aggregate amount. In order to improve the tracking, reporting and
analysis of these costs, program management costs will henceforth be
segregated into administrative and technical cleanup costs on all contract
invoices. Invoices shall include two separate accounts with different activity
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codes for Administrative and technical cleanup costs. Attachment II, Technical
and Administrative Costs Tracked By Activity Code, provides specific
instructions on the use of these codes.
Program management activities are non-site-specific in nature, that is,
they support more than one site " support general Contract activities. Program
n.anagement does not constitute any portion of the LOt hours stipulated for
remedial planning activities.
To assist in improving the tracking and monitoring of these costs, the
following definitions have been developed to segregate the program manage-
ment costs into administrative and technical cleanup cost categories. The
ARCS Contract Tracking (ACT) System will be modified concurrently with
implementation of this guidance to reflect the segregation of program
management into administrative and technical cleanup costs. Invoices and the
ACT system reports should reflect the same dollar amounts for administrative
and technical cleanup costs.
A. Administrative Support Costs are non-site-specific costs necessary for
managing the overall contract regardless of the amount of specific site work.
Administrative support activities are necessary to enable the contractor
to perform remedial site work as well as keeping the Government informed of
overall contract activity.
The following examples will assist in determining which activities fall into
the administrative support category. Because activities vary under each ARCS
contract, this is not a definitive list of all administrative support activities which
might be required.
Contract Mobilization (development of field equipment needs
and inventory control guidelines)
Personnel Management
Preparation of Monthly Reports (Progress and Financial)
(The compilation of site specific progress and financial data
should be charged site-specifically)
Meetings concerning contract operations
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Financial Accounting Activities
Computer Support
Invoicing/Voucher Preparation
Updates to Management, Health and Safety and Quality
Assurance/Control Plans
Routine Communication/Coordination between
EPA/Contractor
Audit Support
Preparation of Contractor's Program Management Summary
Evaluation Reports (SER)
Team Subcontractor Management Activities (Pool subcon-
tract management activities should be charged to remedial
planning.)
Labor Standards Compliance (Service Contract Act/
Davis-Bacon Act)
Maintenance of Corporate Conflict of Interest Plan
and System Support
Annual Contract Close-Out Activities
Clerical Activity in Support of Administrative Functions
Other Administrative Activities (library and other reference
activities, annual allocation reporting, non-site-specific
records retention activities, etc.)
Staffing
Each contractor proposed staffing positions necessary to perform program
management functions. Specific staffing plans were negotiated prior to
contract award. The final approved staffing plans can be found m the
Confirmation of Negotiations in the pre-award contract file. These staffing
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positions are not part of the labor provided under the level of effort capacity of
the contract; they are a unique labor pool available to provide specific program
management functions. Since each of the contractors' staffing plans contain
unique staff descriptions, the examples of staffing shown for administrative and
technical cleanup are used only to indicate staff activities and not specific titles;
they are not provided to indicate staffing patterns for any contract. They are
sample categories of disciplinary expertise and management oversight
necessary for the contract operation. However, anv activities performed by thp
program management staff for site specific activities should be charged to
remedial planning activities.
Examples of staffing that might be used to accomplish administrative
activities are:
Program Manager Reports Manager
Accountant Subcontract Manager
Contract Administrator Secretary/Data Entry Clerk
B. Technical Cleanup Costa are non-site-specific costs for technical
activities that cover multiple sites, and are related to the site-specific
work conducted under the contract.
Most technical cleanup activities under program management are
performed as a result of requirements from multiple sites. These costs will vary
with the number of sites assigned under the contract.
Examples of technical cleanup activities are provided to assist in
determining which activities to include in the technical cleanup category.
Again, this is not a definitive catalogue of these activities.
Equipment/Warehouse Management (Including cost of
equipment maintenance, calibration and inventory)
Meetings concerning technical issues relevant to multiple
work assignments
Health and Safety
Quality Assurance/Quality Control
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Technical Guidance
Pollution Liability Insurance (Site-specific PLI should be
invoiced as a site-specific cost)
Mobile Lab
Tiaining (Requites PO and CO ap^.oval)
Limitation on Future Contracting
Preliminary Conflict of Interest investigations for potential
work assignments
The following are examples of staffing that might be used to accomplish
technical cleanup activities:
Program Manager QA Officer
Contracts Manager Equipment Manager
Sample Coordinator Analytical Coordinator
Health and Safety Officer
Clerical Support for these activities
Health and safety, QA/QC and coordination of CLP/analytical services
should be charged to site specific activities when possible.
C. Activities Containing Components of Both Administrative and
Technical Cleanup Costs
The following activities may fall into both administrative and technical
categories. As a result the contractor should be advised that depending on the
nature of the activity, staff time and related costs should be classified under the
definitions for administrative and technical cleanup costs.
Subcontracting (e.g. Basic Ordering Agreements)
Any subcontracting activities that are not site-specific will be classified
as an administrative support cost.
Standard Operating Procedures
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Standard Operating Procedures (SOP) which deal with overall contract
administration will be classified as an administrative support cost. SOPs
developed for multiple site work will be classified as a non-site-specific
technical cleanup cost.
Equipment/Travel/Other Direct Costs (ODQ/Clerical Support
ODC, equipment, and travel pools for program management should be
allocated between administrative support and technical cleanup areas for
purposes of tracking the costs.
In implementing the segregation of program management costs, actual
equipment costs will be classified as a technical cleanup cost. Labor costs
associated with the justification and approval of equipment purchases will also
be classified as a technical cleanup cost. Travel and ODC costs can be either
administrative or technical cleanup costs and should be monitored, analyzed
and reported under each discrete element.
Clerical support should be similarly segregated by cost into the specific
element supported, either administrative or technical cleanup.
Site-Specific Program Management
Program management costs, both administrative support and technical
cleanup, may be site-specific in nature. Site-specific program management is
also called project management when the activity is part of a site-specific work
plan. Where such costs can be associated with a single site, they must be
included within the approved budget for the individual work assignment. Note
that during contract negotiations contractors wara ancoura^d to maximize site
apaeific program management wherever such coats could be legitimately
associated with a single site.
III. CONTRACT COST INDICATORS
Effective contract management depends on the availability of reliable
indicators of contractor performance. This guidance establishes a number of
key indicators which will be used by regional and headquarters management in
monitoring and analyzing ARCS contract costs.
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The primary beneficiaries of this management data will be the managers
directly responsible for the administration and oversight of ARCS contracts.
Trends can be spotted and cost comparisons can be made to other contracts.
Manual collection of data will be required far less frequently.
All of the information required can be gathered from the ARCS Contract
Tracking (ACT) System. Because critical decisions will be based on the
information provided by these management indicators, regional personnel must
enter data in a timely, accurate, and comprehensive manner. Quarterly reports
will be utilized by headquarters and the Regions in reaching these decisions.
The following indicators are included as examples which can be used to
improve the analysis of contract costs. These indicators and others are
currently available from the ACT System. New indicators will be developed to
meet future needs for trend analyses of contractor performance. Individual
regions may likewise develop additional cost indicators to solve specific
management problems in their own regions.
Expenditures. This indicator provides basic information on total
sums actually expended. The program management data will be displayed in
total and subdivided into administrative support and technical cleanup costs.
Obligations. This indicator will show amounts obligated by work
assignment and total program management obligations. It will provide useful
information for fiscal planning purposes and should be compared to expendi-
tures to avoid excessive funding (i.e. banking money).
Administrative Support Costs vs Total Contract Cost,
Technical Cleanup Costs vs Total Contract Costs,
Program Management Costs vs Total Contract Cost. These
indicators will display total costs associated with these elements as percentag-
es of total contract cost. They will be calculated on the basis of actual
expenditures by region, and by contract. The objective will be to assess the
relative efficiency of program management. To provide consistency in
analyses, pollution liability insurance costs and equipment costs may be
segregated from other administrative and technical cleanup costs.
Administrative Support Costs per LOE Hour Delivered,
Technical Cleanup Costs per LOE Hour Delivered,
Program Management Cost per LOE Hour Delivered. These
indicators will measure the cost-effectiveness of program management
8
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operations. They will provide individual contract rates which can be analyzed,
compared and contrasted.
IV. COST EFFICIENCIES DURING WORK SLOWDOWN
During periods of low contract activity, support costs should be carefully
monitored. Contracting officers and project officers should take the initiative to
assure that contractors incur only absolutely essential costs. Evaluation of
contractor performance under the award fee process during these periods
should focus on the efficiency with which the contractor manages contract
support costs. To insure consistency among ARCS contracts, changes made
to required reports, deliverables or other contract activities should be coordinat-
ed with the Office of Acquisition Management (0AM) and HSCD.
Congress has mandated that the Agency achieve a national target for
program management expenditures compared to total contract expenditures for
ARCS contracts. In FY92, this target was 15%. Future targets may be
adjusted by Congressional action.
V. PROGRAM MANAGEMENT OPTIONS
One of the principal goals of ARCS is to provide incentive to the
contractors to perform in an outstanding manner. To achieve this goal, in
addition to the award fee structure of the contracts, EPA designed the
contracts to have a small base level-of-effort (LOE) with an extended option
structure. Contractors performing in a manner superior to other contractors in
a given region/zone would be rewarded with additional work and contractors
performing less well would receive correspondingly less work.
To complement this option structure for increased quantity of LOE hours,
a corresponding option structure for program management was created. The
difference between the two is that remedial planning options are calculated in
numbers of LOE hours and program management options were calculated as
dollars estimated to support the delivery of the LOE hours.
Contract options for both remedial planning activities and program
management are exercised by the contracting officer at the request of the
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project officer. Note that ARCS contract option structures are variable
depending on the capacity of individual ARCS contracts.
The relative dollar value negotiated for each type of option is based on an
estimated labor mix and an estimated annual delivery rate of LOE. Because the
actual labor mix and annual delivery rate for each ARCS contract are unique,
the ratio between LOE options and program management options has changed
since the contracts were negotiated. It is the responsibility of the contracting
officer and project officer to analyze these changes to assure that adequate
program management support is provided while closely monitoring the overall
costs.
VI. IMPLEMENTATION GUIDANCE
Implementation of this guidance will require a change in the preparation
of supporting documentation utilized in the award fee evaluation. These
changes, addressed in detail below, should be implemented in the next
evaluation period. Implementation will also require the standardization of
selected invoice and reporting requirements among all ARCS contracts. Revised
invoices should be submitted for costs incurred in March, 1993.
A. Roles and Responsibilities
Contractors are responsible for the accumulation and categorization of
program management contract expenditures into administrative and technical
cleanup costs and for the submission of this information in monthly invoices
through the use of the Contractor Invoice Supplemental' Report for Program
Management provided as Attachment I to this guidance. In addition, contractor
invoices should reflect the segregation of administrative and technical cleanup
costs through the use of the two separate activity codes provided in Attach-
ment II, Technical and Administrative Costs Tracked By Activity Code.
Pro/met Officers are responsible for reviewing and approving the
segregated costs as part of the invoice review process and for the evaluation
of these separate activities as part of the award fee process. In addition. Project
Officers are responsible ensuring that the contractor invoices contain the proper
activity codes provided in Attachment II and that the Contractor Invoice
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Supplemental Reports submitted reflect the same amounts for administrative
and technical cleanup services as are reflected in the invoice account coding.
Contracting Officers are responsible for the contractual implementation
of this guidance, evaluation of these separate activities as part of the award fee
process as well as conducting informal reviews not less than semi-annually to
insure that the guidance is being implemented correctly and consistently under
all ARCS contracts. A separate review will be conducted as part of the routine
Financial Management Reviews conducted by OAM.
B. Award Fee
Program management is one of the two areas under which ARCS con-
tractors are evaluated. Contracting officers prepare a Summary Evaluation
Report (SER) on contra-*or activity in the program management area. These
evaluations are incorpc .ted in the final SER prepared by the project officers
to support overall recommendations to the Performance Evaluation Board (PEB).
The Fee Determination Official (FDO) determines the final amount of fee to be
awarded to contractors based upon the findings and recommendations of the
PEB.
The segregation of program management costs into administrative and
technical cleanup costs will result in a change to the supporting documentation
provided. Contracting officers and projects officers, in preparing their
evaluations of contractor performance, should address administrative and
technical cleanup costs as discrete elements in determining overall contractor
performance in providing program management activities.
Because the relative value of administrative and technical cleanup costs
may vary during each evaluation period, no specific ratio between the two
elements can be developed. The project officer, in consultation with the
contracting officer, will need to determine the relationship between the two
elements and incorporate that determination into the SER on program
management.
Implementation of these changes to the award fee evaluation process will
not require a formal change to the award fee plan incorporated in the ARCS
contracts. However, contracting officers and project officers will discuss the
changes in the program management evaluation process with their ARCS
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contractors focusing on the need to improve the tracking and control of
program management costs.
ARCS award fee plans contain general guidance on evaluating program
management activities. The following are some additional areas to be consid-
ered when evaluating the contractor:
In the area of administrative support:
Scheduling, coordinating, and executing all individual work
assignments within the region/zone.
Predicting resource requirements, properly staffing and
training personnel.
Development and adherence to the management plan,
including the health and safety plan and quality assurance/
quality control plans.
Establishing and effectively utilizing the management infor-
mation and cost/schedule monitoring systems and ongoing
analysis for costs and LOE utilization.
Maintaining good communication channels with Regional EPA
officials involved in the Superfund program as well as
responding to regional priorities in a cooperative environment.
Efficient, cost effective management of team subcontractors
and timely placement and efficient, cost effective manage-
ment of pool subcontractors with emphasis on realistic
efforts in meeting the Small Business/Small Disadvantaged
Business Enterprises (SB/SDBE) goals specified in the
contract.
Timeliness and quality of monthly progress and financial
reports.
Timeliness and quality of invoices with particular emphasis
on the adequacy and reasonableness of invoice support
documentation.
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Compliance with all contract terms and conditions.
In the area of technical cleanup:
Effective utilization of contract lab program (CLP) and non-
CLP lab support where applicable in meeting the program
commitment.
Cost effective acquisition and utilization of equipment and
adherence to a property control system.
Timely implementation of corrective action plans affecting
. multiple sites where applicable.
Timely development and modification of health and safety
plans.
Management of corporate COI issues related to the limitation
on future contracting activity.
Diligent efforts to secure non-site-specific PLI
C. Invoicing and Reporting Requirements
In order to effectively monitor costs incurred for both administrative
support and technical cleanup costs, an adjustment in the method by which a
contractor invoices program management costs must be made. The ARCS
contracts already require contractors to supply detailed cost element invoicing
in accordance with the contract clause entitled "Submission of Invoices"
(EPAAR 1552.232-70). The contractor is required to provide cost detail
support on all major cost elements such as direct labor, travel, equipment and
subcontracts as well as any associated indirect costs.
On January 13, 1992, the Office of Administration and Resources
Management (OARM) issued a memorandum signed by David O'Connor,
Director of PCMD, and Henry Longest, Director of OERR, addressing mandatory
invoice tracking elements under ACT. The memorandum provided as an
attachment a Contractor Invoice Supplemental Report for Program Management
indicating the minimum invoice data elements to be reported by the contractor.
This invoice supplement does not requi.c any additional information than is
13
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already required by the contract and by FAR 52.232-25. As a result of the
segregation in program management however, this guidance provides revisions
to the invoice supplement contained in the January 13th memorandum. In as
much as this type of invoice reporting detail is already a contract requirement,
modifications to existing ARCS contracts will not be necessary.
The revised Contractor Invoice Supplemental Report for Program
Management is included as Attachment I to this guidance. This revised
attachment requires the contractor to provide a summary level report of
program management by cost element. Beginning with the invoices submitted
for March, 1993, the ARCS contractors will be required to use this form when
invoicing their program management administrative and technical cleanup costs.
' In determining whether to report a program management cost as administrative
support or technical cleanup the contractor must follow this guidance.
Please note that the invoice for program management/administrative
support costs does not include the cost elements for Pollution Liability
Insurance (PLI), Equipment, Lab Services and Mobile Lab Services as part of the
cost elements on the administrative program management invoice. The actual
cost of purchasing any PLI (premiums), equipment, or lab/mobile lab services
as well as labor costs associated with the procurement of these goods and
services will be reported under technical cleanup costs.
Requiring the ARCS contractors to utilize the Invoice Supplemental Report
will facilitate the subsequent input of this data into the ACT system and
promote standardization and national consistency.
D. Other Implementation Guidance
Attachment II, Technical and Administrative Costs Tracked by Activity
Code, proves specific implementatic.. instructions regarding the use by ARCS
contractors of separate activity codes within account numbers in invoicing for
administrative and technical support under the ARCS contracts. The attach-
ment also provides a point of contact within the Superfund Accounting Branch
of the Financial Management Division to answer questions regarding the proper
use of these new activity codes.
A Guide to Program Management Cost Allocations is provided as
Attachment III to this memorandum. This will simplify the analysis of costs by
the CO and PO.
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ATTACHMENT I
CONTRACTOR INVOICE SUPPLEMENTAL REPORT
SUMMARY PROGRAM MANAGEMENT INVOICE
1 of 3
1 INVOICE NUMBER:
INVOICE P*T-
PERIOO START DATE: 1
PERIOD END DA 'E: |
CATEGORY
PRIME LABOR COSTS
INDIRECT COSTS
G&A
OTHER DIRECT COSTS
POLLUTION LIABILITY
INSURANCE
TRAVEL
EQUIPMENT
LAB SERVICES
MOBILE LAB COSTS
TEAM SUBCONTRACTORS
OTHER SUBCONTRACTORS
BASE FEE
AWARD FEE
TOTAL » INVOICED
NOTES
BASE LABOR (STRAIGHT
SALARY WITHOUT FRINGE)
OTHER THAN G&A (INCLU-
DING FRINGE)
EXCLUDES TRAVEL, EQUIP-
MENT, LAB SVCS, & MOBILE
LABS
UNLOADED VALUE
DOES NOT INCLUDE RELO-
CATION (INCLUDED IN ODC
LINE)
UNLOADED VALUE
UNLOADED VALUE
UNLOADED VALUE
INCLUDES ALL FEES
CHARGED TO P9"ME
INCLUDES ALL FEES
CHARGED TO PRIME
INCLUDES FCCM
PRIME ONLY
VALUES
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CONTRACTOR INVOICE SUPPLEMENTAL REPORT
PROGRAM MANAGEMENT INVOICE
ADMINISTRATIVE SUPPORT
2 of 3
INVOICE NUMBER:
INVOICE DATE:
PERIOD START DATE:
PERIOD END DATE:
CATEGORY
PRIME LABOR COSTS
INDIRECT COSTS
G&A
OTHER DIRECT COSTS
TRAVEL
TEAM SUBCONTRACTORS
OTHER SUBCONTRACTORS
BASE FEE
AWARD FEE
TOTAL » INVOICED*
NOTES
BASE LABOR (STRAIGHT
SALARY WITHOUT FRINGE)
OTHER THAN G&A (INCLU-
DING FRINGE
EXCLUDES TRAVEL, EQUIP-
MENT, LAB SVCS, & MOBILE
LABS
DOES NOT INCLUDE RELO-
CATION (INCLUDED IN ODC
LINE)
INCLUDES ALL FEES
CHARGED TO PRIME
INCLUDES ALL FEES
CHARGED TO PRIME
INCLUDES FCCM
PRIME ONLY
* Total must aoree with total amount invoiced undar a£fiyjiy.£Qfla_
VALUES
a**
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CONTRACTOR INVOICE SUPPLEMENTAL REPORT
PROGRAM MANAGEMENT INVOICE
TECHNICAL CLEANUP COSTS
Page 3 of 3
INVOICE NUMBER:
INVOICE DATE:
PERIOD START DATE:
PERIOD END DATE:
CATEGORY
PRIME LABOR COSTS
INDIRECT COSTS
G&A
OTHER DIRECT COSTS
POLLUTION LIABILITY
INSURANCE
TRAVEL
EQUIPMENT
LAB SERVICES
MOBILE LAB COSTS
TEAM SUBCONTRACTORS
OTHER SUBCONTRACTORS
BASE FEE
AWARD FEE
TOTAL $ INVOICED*
NOTES
BASE LABOR (STRAIGHT
SALARY WITHOUT FRINGE)
OTHER THAN G&A (INCLU-
DING FRINGE)
EXCLUDES TRAVEL, EQUIP-
MENT, LAB SVCS, & MOBILE
LABS
UNLOADED VALUE
DOES NOT INCLUDE RELO-
CATION (INCLUDED IN ODC
LINE)
UNLOADED VALUE
UNLOADED VALUE
UNLOADED VALUE
INCLUDES ALL FEES
CHARGED TO PRIME
INCLUDES ALL FEES
CHARGED TO PRIME
INCLUDES FCCM
PRIME ONLY
VALUES
* Total must agree with total amount invoiced under activity code a.
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"^^
KJ_
TT
TECHNICAL ft ADMINISTRATIVE COSTS TRACKED BY ACTIVITY CODE
EPA will be able to track and report the technical and
administrative contract expenses in its accounting systea through
the usa of account limbers. FMD haa designated activity coda "9"
for adMinir*—*«-ive costs s» defined in tha guidance and activity
coda "A" for technical cleoj.jp as defined in the guidance.
Contractors should use these activity codes in the account codes
on the invoice site distribution sheets. Project Officers are
responsible for ensuring that the correct codes are used. Zf
there are any questions about the account codes or activity
codes, please contact the Chief, Superfund Accounting Branch, FMD
at (202) 260-9268.
USE ACTIVITY CODE "9" POR ADMINISTRATIVE COSTS PORTION OF PROGRAM
MANAGEMENT
NON-SITE
ACCOUNT
FOR
SUPPORT
3 TFA 72 F 9 00
ACTMT>
BITE/SPILL
DENT.
USE ACTIVITY CODE "A" POR TECHNICAL COSTS PORTION OP PROGRAM
NON^TTE
6^fc^*j^%s^s^^ 1
3
TFA
72
F
A
00
o
o
TECHNICAL
SUPPORT
8TH DIGIT
APPN.
YEAR
AUXKV
CODE
t
TE/BPlU
BENT.
REPRESENTS ACTIVITY CODE.
9TR AND 10 DIGIT REPRESENTS SITE NUMBER. POR ADMINISTRATIVE
OR TECHNICAL CLEANUP, USE "00" SITE, UNLESS THE ACTIVITY CAN
BE TRACED TO A SITE SPECIFIC S8ID.
CONTACT THE SUPERFUND ACCOUNTING BRANCH IN FMD AT
(202) 260-9268.
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ATTACHMENT III
GUIDE TO PROGRAM MANAGEMENT COST ALLOCATIONS
The purpose of this guide is to assist th« Regional COs and POs in evaluating
the program management costs for segregation into administrative or technical
cate ories.
Currently, program management costs are tracked and report on the
basis of an aggregate amount. Zn order to improve the tracking eporting and
analysis of these costs, program management costs will be segre. ed into
administrative and technical cleanup costs.
To assist in improving the tracking and monitoring of these costs, the
following definitions have been developed to segregate the program manage-
ment costs into administrative and technical activitiee. Examples cannot be
provided for every program management cost you may encounter, however, the following
may assist in your determination.
A. Administrative Support Costs are non-site-specific costs necessary for
managing the overall contract regardless of the amount of specific site work. The
following are examples of administrative support costsi
Contract Mobilization (development of field equipment needs and
inventory control guidelines)
Personnel Management
Preparation of Monthly Reports (Progress and Financial)
(The compilation of site-specific progress and financial
data should be charged site-specifically)
Meetings (concerning contract operations)
Financial Accounting Activities
Invoicing/Voucher Preparation
Computer Support
Updates to Management, Health and Safety, and Quality Assurance/Control
Plans
Routine Communication/Coordination between EPA/Contractor
Audit Support
Preparation of Contractor's Program Management Summary Evaluation
Reports (SER)
Team Subcontractor Management Activitiee (Pool subcontract management
activities should be charged to remedial planning.)
Maintenance of Corporate Conflict of Interest Plan and System Support
Labor Standarde Compliance (Service Contract Act/Davis Bacon Act)
Annual Contract Close-Out Activities
Clerical Activity in Support of Administrative Functions
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-2-
Other Administrative Activities (library and other reference activities,
annual allocation reporting, non-site-specific records retention
activities, etc.)
. staffing - Bach contractor proposed staffing positions necessary to
perform program management functions. Specific staffing plans were
negotiated prior to contract award. The final approved staffing plans
can be found in the Confirmation of Negotiations in the pro-award
contract file. These staffing positions are not part of the labor
provided under the level of effort capacity of the contract; they are a
unique labor pool available to provide specific program managtaent
functions. Since each of the contractors' staffing plaaa contain unique
staff descriptions, the examples of staffing shown for administrative
and technical cleanup are used only to indicate staff activities and not
specific titles; they are not provided to indicate staffing patterns for
any contract. They are sample categories of disciplinary expertise and
management oversight necessary for the contract operation. However, any
activities performed by the program management etaff for site specific
activities should be charged to remedial planning activities.
Examples of staffing that might be used to accomplish administrative
activities aret
Program Manager Reports Manager
Accountant Subcontract Manager
Contract Administrator Secretary/Data Entry Clerk
B. Technical Cleanup Costs are non-site-specific costs for technical
activities that cover multiple sites, and are related to the site-specific work
conducted under the contract.
Most technical cleanup costs under program management are incurred as
a result of requirements from multiple sites. Thus the amount of these costs
will vary with the number of sites assigned under the contract.
Examples of technical cleanup activities are provided to assist in
determining which activities to include in the technical support category.
Again, this is not a definitive catalogue of these activities.
Equipment/Warehouse Management (Including cost of equipment maintenance,
calibration and inventory)
irning technical issues relevant to multiple work
Health and Safety
Quality Assurance/Quality Control
Technical Guidance
Pollution Liability Insurance (Site-specific PLI should be invoiced
as a site-specific cost)
Mobile Lab
Training (Requires PO and CO approval)
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-3-
Limitation on Future Contracting
Preliminary Conflict of Interest investigations for potential work
assignments
The following are examples of staffing that might be uaed to accomplish
technical support aetivitieas
Program Manager Sample Coordinator
QA Officer Analytical Coordinator
Contracts Manager Health and Safety Officer
Equipment Manager Clerical Support for these activities
Health and safety, QA/QC and coordination of CLP/analytical services
should be charged to site-specific activitiee when possible.
C. Activities Containing Components of Both Administrative and
Technical Cleanup Costs
The following activitiea may fall into both administrative and technical
categories depending on the nature of the activity!
Subcontracting (e.g. Basic Ordering Agreements) - Any subcontracting
activities that are not site specific will be classified as an
administrative support coat.
Standard Operating Procedures (SOP) which deal with overall contract
adminiatration will be classified as an administrative support cost.
SOPs developed for multiple site work will be classified as a non-site
specific technical cleanup cost.
Equipment/Travel/Other Direct Costs (ODC)/Clerical Support
ODC, equipment, and travel pools for program management ehould be
allocated between administrative support and technical cleanup areas for
purposes of tracking the costs.
In implementing the segregation of program management coeta, actual
equipment costs will be classified as a technical cleanup cost. Labor
coats associated with the juatification and approval of equipment
purehaaes will also be classified as a technical cleanup cost. Travel
and ODC coats can be either administrative or technical cleanup costs
and ahould be monitored, analyzed and reported under each discrete
element.
Clerical support should similarly be eegregated by coat into the
apecific element supported, either adminiatrative or technical cleanup.
Site-Specific Program Management - Program management costs, both
administrative support and technical cleanup, may be site-specific in nature.
Site-apecific program management is alao called project management when the activity
is part of a site-epecific work plan. Where auch costs can be associated with a
single site, they muet be included within the approved budget for the individual
work assignment. Note that during contract negotiations contractors were encouraged
to maximise aita-apecific program managamert wherever auch costs could legitimately
be aaaociated with a aingle site.
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Guide to Program Management Cost Allocations
Cost Category
Administrative Support
Technical Cleanup
Other
Direct Labor
o Hours to support
preparation of monthly
progress reports (e.g.,
assembling input from
field personnel)
o invoicing (e.g.,
time spent in
accounting, compiling
billing activities)
o personnel Management
o attending contract-
wide meetings
o managing team
subcontractors
o Maintenance of
corporate conflict of
interest plan and
system
o Updating and
maintaining contract-
wide management, QA/QC
and Health and Safety
Plans, other SOPs
o Equipment
maintenance/-
warehouse
management
o Hours billed to
train technical
personnel
o Maintenance of
mobile labs
o Hours billed by
safety officer
(e.g, guidance on
OSHA regs to site
managers)
o Hours billed in
technical
consultation
regarding
interpretation of
Agency requirements
on QA/QC,
analytical methods,
etc.
o Diligent effort
in procuring pollu-
tion liability
insurance for
entire contract
o Clerical hours may
be directly allocable
to either
administrative or
technical support
(e.g., updating nn
equipment list is
technical, typing
monthly progress
reports is
administrative)
o Hours related to
site-specific IF >
requirements, sampling
procedures, QA/QC
plans, safety issues
and subcontracting
should not be billed to
PM but rather to the
site.
o Diligent effort for
site-specific Pr +
indemnification request
should be billed site-
specifically and mot
o Preparation of site-
specific progress
reports should be
billed site-
specifically and
information should be
used in summary
reports.
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Cost Category
Administrative Support
Technical Cleanup
Other
Indirect Costs
o Contract specific
established rate (other
than GtA)
o Contract specific
established rate
(other than GfcA)
General and
Administrative
o Contract specific
established rate
o Contract specific
established rate
Other Direct Costs
o computer tine
o office supplies
o courier service
o Mobile lab
utility costs when
lab is idle.
o general office
equipnent for sites
should be billed site-
specifically
o when mobile lab is in
use utility costs
should be charged site
specifically.
Pollution Liability
Insurance
o cost of contract-
wide or multi-site
policy
o cost of site-specific
policies should be
billed site-
specifically
Travel
o Travel related to
general management of
entire contract
o Sending a
technical
specialist to a
conference (with
EPA permission)
o travel by specialist
to an individual site
should be billed site-
specifically
o travel to present
material on individual
site at a conference
(with EPA permission)
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Cost Category
Administrative Support
Technical Cleanup
Other
Equipment
o General office
equipment for personnel
o special equipment
for site operations
o individual equipment
pieces leased or
purchased due to a
unique site-specific
requirement should be
billed site-
specifically
Lab Services
o Purchase of
standards/methods,
lab maintenance and
calibration with
contractor-
owned/managed lab
o contracts with
laboratories should be
billed site-
specifically
Mobile Lab Costs
o Utility costs,
maintenance etc.
associated with
labs
Team Subcontractors
o Fees, invoices and
management of team subs
o Team sub experts
consulted for
multi-site support
o Other costs related
directly to management
of a specific site
should be billed to the
individual site
Other Subcontractor
o Fees, invoices and
management of subs to
primes
o Sub experts
consulted for
multi-site support
o Other subs procured
to support site
specific activities
should be billed to
individual site.
Baee Fee
o Contract specific
established %
o Contract specific
established %
o calculated as %
across all categories
Pee
o Fee earned on admin-
iatrative support work
o Fee earned on
technical work
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