NASA NPD 4500.1, NPR 4500.1 and Their Relationship to Standards

PRESENTATION TO

NES 2014 NASA/CONTRACTOR SIG MEETING

MIKE SHOWERS, ASSET MANAGEMENT ASSISTANCE, L.L.C.

FAR 52.245-1, Government Property (b) Property management.

(1) The Contractor shall have a system of internal controls to manage (control, use, preserve, protect, repair, and maintain) Government property in its possession. The system shall be adequate to satisfy the requirements of this clause. In doing so, the Contractor shall initiate and maintain the processes, systems, procedures, records, and methodologies necessary for effective and efficient control of Government property. The Contractor shall disclose any significant changes to its property management system to the Property Administrator prior to implementation of the changes. The Contractor may employ customary commercial practices, voluntary consensus standards, or industry-leading practices and standards that provide effective and efficient Government property management that are necessary and appropriate for the performance of this contract (except where inconsistent with law or regulation).

Issues

No definition of “Industry Leading Practice or Standard”

No definition of “Customary Commercial Practice”

No clear internal NASA guidance related to recognition, acceptance, or implantation

Confusion between recordkeeping systems and overall property systems, plans, standards, etc.

Standards, Practices, Plans and Systems – NPD/NPR 4500.1Definitions

Customary Commercial Practice. A documented practice or standard accepted across an industry developed through a consensus process limited to that industry.

Industry Leading Practice and Standard. A documented, proven practice or standard that exceeds common industry practice or standard in performance or effectiveness and in cost control. Industry leading practices and standards prove increased performance or effectiveness, in addition to decreased or constant cost through their acceptance and publication in refereed, professional journals.

Voluntary Consensus Standards. Standards developed or adopted by voluntary consensus standards bodies, both domestic and international. (See OMB Circular A-119).

Voluntary Consensus Standards PL 104-113, National Technology Transfer

and Advancement Act of 1995 OMB Circular A-119

Implements Act

Requires use by Federal Agencies in lieu of Government unique standards

Defines the term

Purpose Cost reduction

Promote Government use of private sector

NASA POLICY DIRECTIVE (NPD) 4500.1 Highlights NASA policy regarding the “Administration of Property in the

Custody of Contractors” Issued September 13, 2013

Instruction to NASA Civil Servants

Available NASA NODIS website:

http://nodis3.gsfc.nasa.gov/displayDir.cfm?t=NPD&c=4500&s=1

Requires CO approval for the PROVISION of Government property to

contractors

Regular review of contractor performance of property management

Prohibits NASA personnel from reducing or removing the requirement for contractors to maintain systems and records for offsite property

NASA POLICY DIRECTIVE (NPD) 4500.1 Highlights Establishes Recordkeeping Requirements

NASA maintains fiduciary (financial) records

Contractor maintains stewardship (custodial or property) records for offsite property and some on-site property

NASA Procedural Requirements and Policy Directives are used for the management and recordkeeping of onsite property

NPR 4200 requires equipment valued greater than $5000 or which is defined by the center and NPR as sensitive be recorded in the NASA PP&E (NPROP)

NPR 4100 requires that NASA Centers establish material control and accountability systems

Stores Stocks – require central control

Program Stocks – may be decentralized

Property that does not qualify for RECORDKEEPING in NASA systems must be recorded in Contractor systems in accordance with FAR 52.245-1

Contractor Held /Used Recordkeeping Requirements

Record

On-site?

NPR 9250NF-1018CHATS

Financial?

FAR 52.245-1

Store Stock?

Equipment?

NASA Recorded Program Stock?

PP&E/NPROP

Qualify for

internal control?

SEMO Authorized

NASA System

No

Yes No

No

No

No

No

Yes

Yes

Yes

Yes

Yes

Standards, Practices, Plans and Systems – NPD 4500.1

NASA requires offsite recordkeeping and management to be performed in contractor’s systems

NASA permits the use of VCS, ILPS, and CCP

Use is conditional Must be offsite

Government provided property

Must be adequate for contract requirements

Restricts imposition of additional requirements unless absolutely necessary for safety or security reasons

Standards, Practices, Plans and Systems – NPD 4500.1

1. Policy

…”c. When NASA property is provided for use outside of a NASA Center or Installation, it is considered Government Provided Property (GPP), and NASA will rely on contractors to be responsible for the stewardship of that property. This includes property acquired by the contractor when that property is titled to the Government under the Government Property clause or under contract financing provisions.”

…”f. To avoid unnecessary costs associated with duplication of effort, contractors performing outside of NASA Centers and Installations are required by contract to record GP in existing corporate property systems and to manage property using corporate plans, procedures, practices, and standards. NASA projects, programs, and mission support activities shall not attempt to reduce or remove this requirement.”

Standards, Practices, Plans and Systems – NPD 4500.1

h. NASA will allow contractors, when performing within their own facilities, to follow industry leading practices and standards (ILP&S), voluntary consensus standards (VCS), or customary commercial practices (CCP) for the stewardship and management of GP to the extent that ILP&S, VCS, and CCP exist and are adequate for the management of property under the contract's circumstances. NASA officials should not impose additional GP management, recordkeeping, or reporting requirements on contractors when those contractors perform within their own facilities, and the requirements would create a NASA-unique requirement and result in increased administrative costs to the Agency through duplication of contractor records, systems, processes, or work effort.

NASA PROCEDURAL REQUIREMENT (NPR) 4500.1

NASA’s Contract Property Administration Manual Found at the NODIS Website:

http://nodis3.gsfc.nasa.gov/displayDir.cfm?t=NPR&c=4500&s=1

Preface and 8 Chapters

Generally follows a contract’s life cycle from preaward through closeout

Describes procedures related to contract property administration

Describes Procedures for NASA Personnel and PA Support Contractors

NPR 4500.1 Highlights

Preface – Purpose, Applicability, Legal and Regulatory Authorities, Applicable Documents and Forms

Chapter 1 - Objectives, Scope, Authorities and Responsibilities, Deviations

Chapter 2 - Pre-award processes, Solicitation Review, Evaluation of proposed property management plans

CHAPTER 3 - Delegation and Oversight of Property Administration Activities

CHAPTER 4 - Performance of NASA-Retained Property Administration Activities

NPR 4500.1 Highlights

CHAPTER 5 - Property Management System Audit CHAPTER 6 - Contract Property Management

Reporting CHAPTER 7 - Special Situations CHAPTER 8. Contractor Inventory Disposition Appendix A. Definitions

Solicitation Phase - NPR 4500.1

Section 2.1 Requires the IPO to recommend the inclusion of the Solicitation Provision NFS1852.245-80, Government Property Management Information

Provision requires submission of: Property management plan

Results of last PMSA

Intention to accept GFP or directly charge property not part of the deliverable

Use of GP from other contracts on the contract

Proposal Phase - NPR 4500.1

Section 2.2.1 Requires the IPO to Review the contractor’s proposed property plan based on: Completeness – does the plan address all

relevant “outcomes” Acceptability – based on risk to safety,

performance, and cost

IPO advises the CO of changes to plan needed to make it adequate

Section 2.2.2.1 Discusses the use of VCS IPO work with program to determine when NASA

specific processes or standards are required to meet safety or other performance criteria

Discusses the difference between procedural and performance standards

Procedural standards are acceptable when they meet the requirements of the contract

Performance standards are designed to address OUTCOMES. They are preferred

Proposal Phase - NPR 4500.1

OMB Circular A-119Standards Definitions

Different types of standardsPerformance standard –

Seeks results Does not pre or proscribe methodsContains a criteria for measurement or

verification

Prescriptive standard – SpecificationsMethods

Section 2.2.2.2 Discusses the use of ILPS Requires that the practice or standard

exceeds CCP or VCS Requires documentation showing how it

exceeds

Proposal Phase - NPR 4500.1

Section 2.2.2.3 Discusses the use of CCPs Must be acceptable under contract

circumstances Section 2.2.2.4 Discusses the use of existing

process, standards, systems Many contractors were already performing

adequately Must be acceptable under contract

circumstances Use of VCS, ILPS, CCPs should be encouraged

Proposal Phase - NPR 4500.1

PMSA NPR 4500.1

5.1.1.1 Through the PMSA, the PA evaluates the contractor’s management (control, use, preservation, protection, repair, and maintenance) of GP in its possession. The contractor’s performance and the PA’s evaluation criteria shall be consistent with the contractual requirements, as well as with VCSs, ILPSs, and CCPs for property management that have been determined to be adequate for the performance of the applicable contracts. Determination of adequacy of VCS, ILPSs, and CCPs may occur either as part of the award process or in response to a contractor’s reported changes.

PMSA NPR 4500.1

Section 5.1.4.2 Recommends that the PA request the contractor’s VCS, ILPS, CCPs, and processes as part of the PMSA pre-work

PMSAs should consider both the requirements of the contract AND any proposed VCS, ILPS, CCPs, or existing procedures in their evaluation

RELATIONSHIP OF ASTM STANDARDS TO FAR

OUTCOMES

OVERALL PROPERTY MANAGEMENT

E2135-10ae1 Standard Terminology for Property and Asset Management

E2279-09 Standard Practice for Establishing the Guiding Principles of Property Management

E2452-12 Standard Practice for Equipment Management Process Maturity (EMPM) Model

E2675-09 Standard Practice for Property Management System Outcomes

E2936-13 Standard Guide for Contractor Self Assessment for U.S. Government Property Management Systems

ACCOUNTING

E2453-13 Standard Practice for Determining the Life-Cycle Cost of Ownership of Personal Property

E2378-13 Standard Practice for the Recognition of Impaired or Retired Personal Property

RISK

E2495-13 Standard Practice for Prioritizing Asset Resources in Acquisition, Utilization, and Disposition

E2608-08 Standard Practice for Equipment Control Matrix (ECM)

E2811-11 Standard Practice for Management of Low Risk Property (LRP)

RECEIVING, IDENTIFICATION & MARKING E2605-13 Standard Practice for Receiving

Assets E2631-09 Standard Practice for Physical

Placement of an Entity-Controlled Supplemental Identification Label

E2672-09 Standard Practice for Identification and Categorization of Tooling

E2606-13 Standard Practice for Receipt Notification as a Result of Tangible Asset Movement

RECORDS

E2499-11 Standard Practice for Classification of Asset Physical Location Information

E2604-09 Standard Practice for Data Characteristics of Equipment Records

E2812-11 Standard Practice for Uniform Data Management in Asset Management Records Systems

PHYSICAL INVENTORY

E2132-11 Standard Practice for Inventory Verification: Electronic and Physical Inventory of Assets

REPORTS AND RELIEFS OF STEWARDSHIP RESPONSIBILITY

E2131-09 Standard Practice For Addressing and Reporting Loss, Damage, or Destruction of Tangible Property

E2674-09 Standard Practice for Assessment of Impact of Mobile Data Storage Device (MDSD) Loss

UTILIZATION(MOVEMENT AND STORAGE)

E2671-10 Standard Practice for Defining Movements, Shipments, and Transfers of Tangible Property

E2715-09 Standard Practice for Moveable Property Storage

E2676-09 Standard Practice for Tangible Property Mobility Index (MI)

E2497-11 Standard Practice for Calculation of Asset Movement Velocity (AMV)

CLOSEOUT AND DISPOSAL

E2306-13 Standard Practice for Disposal of Personal Property

E2858-12 Standard Practice for Sales of Personal Property

E2607-08(2013) Standard Practice for Cannibalization/Reclamation of Serviceable Equipment Components to Support Demand Requirements

UNADDRESSED OUTCOMES

Utilization – actual use/assuring that property is used only for the purpose (contract) for which it was provided or authorized

Subcontractor control – work item scheduled for development of a standard this year

Performance standards

with metrics

QUESTIONS?

Mike Showers

Asset Management Assistance, L.L.C.

PO Box 552

Poolesville, MD 20837

mike@assetmanagementassistance.com

301.355.0849