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NASA Ball NASA
Procedural
Requirements
NPR 9090.1B
Effective Date: March 04, 2020
Expiration Date: March 04, 2025
COMPLIANCE IS MANDATORY FOR NASA EMPLOYEES
Printable Format (PDF)

Subject: Partnership Agreements-Financial Requirements and Administration

Responsible Office: Office of the Chief Financial Officer


| TOC | Preface | Chapter1 | Chapter2 | Chapter3 | Chapter4 | AppendixA | AppendixB | AppendixC | AppendixD | AppendixE | AppendixF | AppendixG | ALL |

Chapter 4. Reimbursable Agreement Pricing

4.1 Overview

4.1.1 NASA provides reimbursable support to other Federal/governmental agencies, commercial sector entities, educational entities, and foreign entities under various legal authorities in a wide range of agreement activity. Several authorities contain conditions and requirements for reimbursable activity and the allowance for other than full-cost reimbursement. Because of these specific conditions and allowances, NASA considers the authority for the reimbursable agreement in the price charged to the partner along with the cost.

4.1.2 Cost and price are sometimes used interchangeably or calculated using the same methodology; however, as discussed above, they are not the same. The authority, the agreement activity, and the partner will be considered when determining the appropriate pricing methodology. NASA’s estimated full cost discussed in Chapter 3 is the baseline and starting point for both reimbursable and nonreimbursable agreements and should be calculated using the EPR/ECR template in Appendix C. For reimbursable agreements, adjustments are then included for waived costs (benefits received by NASA), excluded costs, or other authorized pricing adjustments (e.g., market-based pricing variation), to arrive at the estimated price charged the partner.

4.1.3 Current recognized pricing methodologies are standard rate based, cost based, and market-based pricing, as discussed in the following sections.

4.2 Pricing Methodologies

4.2.1 Standard Rate Pricing. Just as a standard rate ($/unit) or charge is used for estimating the full cost of an agreement activity, the same standard rate calculation would be used for pricing the activity in an EPR. Refer to section 3.3.1.1 for additional information on standard rate development. The estimated full cost based on a standard rate may be adjusted through pricing adjustments in accordance with this NPR to determine the estimated price to the partner. Adjustments will be properly identified and justified in the EPR.

4.2.2 Cost-Based Pricing. Cost-based pricing is applied in accordance with the agreement costing estimate calculation outlined in sections 3.2 and 3.3.1.2. The agreement’s estimated cost may be adjusted through pricing adjustments in accordance with this NPR to determine the estimated price to the partner. Adjustments will be properly identified and justified in the EPR.

4.2.3 Market-Based Pricing. Per OMB A-25, User Charges, “market price means the price for a good, resource, or service that is based on competition in open markets, and creates neither a shortage nor a surplus of the good, resource, or service.” Market-based rates are based on the fair market value. Rates will be established through an annual (or as required) survey and should avoid putting outside commercial providers at a competitive disadvantage, i.e., price should be adjusted to similar prices charged “outside the gate.” Refer also to NPD 9080.1.

4.2.3.1 Market-based pricing is required in the out-granting of real property and EUL arrangements. Exceptions are where the pricing requirements for specific services or facilities are established by statutory authority or where the agreement activity to be performed by NASA does not have a comparable fair market value equivalent on which to base the rates.

4.2.3.2 Market-based pricing requires establishing the full cost of the agreement activity and adjusting (upward or downward) to achieve the market price to the partner. Centers should consult with their Center OCFO and Center OCC to ensure adherence to other NASA policy provisions. Refer to Appendix E. Market-Based Pricing and OMB Circular A-94, Guidelines and Discount Rates for Benefit-Cost Analysis of Federal Programs.

a. Where a contemplated market price is higher than the full cost of the work, the ability to charge will not conflict with other legal or policy restrictions, e.g., Economy Act agreements are limited to actual or full cost pricing. Retention of proceeds is limited to the statutory authority cited in the agreement (section 2.4.3b).

b. Where a contemplated market price is lower than full cost, the following should be considered in the determination:

(1) The real property, other assets, or services are underutilized and available.

(2) The full cost is inconsistent with local market conditions.

(3) The revenue derived would offset some or most of the current budget requirement for maintenance and disposition.

(4) The price should be at or above the marginal cost of providing the good or service.

4.2.3.3 The Center OCFO will ensure a market survey is provided when Center reimbursable work is comparable to a market equivalent and the results of the survey are consolidated, evaluated, and analyzed, with the objective of reaching a pricing structure for the Center. The pricing structure will be:

a. Supported by the survey results.

b. Comparable to prices that partners could expect to find at other commercial providers, given any discount or premium that is applied to compensate for bona-fide differences.

c. Rational, fair, and consistently applied.

4.2.3.4 Where commercial service providers are unwilling to share pricing information or the Center is unable to compile enough information to develop a market survey, the information should be documented and an alternative pricing methodology used.

4.3 Pricing Adjustments

4.3.1 Waived Cost. Waived costs represent costs that are estimated to be incurred by NASA to perform work associated with a reimbursable agreement, but are not charged to the partner because of the benefit received by NASA. Estimated waived costs are identified a pricing adjustment column on the EPR. Centers should only consider waived cost requests where there is a clear and demonstrated NASA benefit. Consideration should be based on whether the office absorbing the costs is willing to fund the waived costs based on the benefits derived from the effort if the reimbursable agreement were not being executed. As described in section 2.2.1e, the sponsoring organization providing an alternative source of direct funding for waived costs shall also provide concurrence when different than the performing office.

a. Benefits derived will be directly related to NASA’s mission/program/projects and, to the extent practicable, quantifiable. Cost waivers may not be based on intangible benefits, such as goodwill, community relations, or philanthropic reasons.

b. Benefits may be established based on the performing and/or sponsoring organizations identifying how the work would benefit NASA. A few examples of programmatic benefits include agreements involving activities directly related to NASA’s strategic education goals, development or testing where the resultant product or data has value to NASA’s mission, and work products (e.g., test data) that are made available to NASA. Although not as common, cost waivers may also be developed related to institutional resources.

c. Where direct costs are waived, the indirect cost may be waived in proportion to the reduction. Along with justification, the direct and indirect waived costs will be identified as separate pricing adjustments on the EPR.

d. The Center CFO is responsible for final approval of requested waived costs up to the indirect cost amount. When the estimated price to the partner is less than the direct cost to NASA, the Agency CFO will also review and approve the EPR. (See section 1.2.)

4.3.2 Other Authorized Pricing Adjustments. Other authorized pricing adjustments will be based on laws, regulations, policy, or allowable market-based pricing methodologies. When authorized pricing adjustments are used, performing organizations need to recognize that the estimated full cost is not recovered and their direct funds are used. Examples of authorized pricing adjustments currently used by NASA are excluded costs, market-based pricing, and Tracking and Data Relay Satellite System (TDRSS), 14 CFR pt. 1215.

4.3.2.1 Excluded Costs. Excluded costs represent estimated costs that are not chargeable [price] to a partner due to laws, regulations, or official agency requests per NPD 9080.1. Budget submission justifications and requests do not represent OMB approval unless they are expressly outlined and understood to be requests for approval of less than full cost. 17 Excluded costs are identified in the price adjustment column of the EPR. CSLA is an example of statutory exclusion for certain cost in calculating the price to a partner.


17 Rate reductions set during NASA council meetings do not serve as approval and authorization.

4.3.2.2 Market-Based Pricing. Market-based pricing may result in net proceeds or loss to NASA. For real property out-grants, market-based pricing generally results in the price exceeding the estimated cost (upward price adjustment) as most of NASA’s real property has been fully depreciated. For goods or services that are calculated at full cost, the market price may identify a loss (a downward price adjustment) to NASA. The amount collected above full cost may only be retained as allowed by statutory authority; otherwise, they are deposited into the Treasury’s Miscellaneous Receipt Account. Market-based adjustments are identified in the price adjustment column of the EPR.

4.3.2.3 TDRSS Pricing. 14 CFR pt. 1215, establishes considerations to be used in pricing TDRSS charges for non-U.S. government entities. TDRSS pricing adjustments are identified in the price adjustment column of the EPR.

4.4 Considerations for Pricing Reimbursable Work

4.4.1 Considerations for Pricing Federal Reimbursable Agreements. Law prohibits an agency from deriving profit, augmenting its appropriations, or using another agency’s funds for purposes other than for which the funds were originally appropriated.

4.4.1.1 Economy Act. The Economy Act provides authority for Federal agencies to engage in interagency reimbursable activity under certain circumstances. The EPR, estimated cost and price, is based on full-cost principles to reasonably reflect the actual cost of the work for the Federal partner as required by the Economy Act.

4.4.1.2 Other Authorities. The Center should consult their Center OCC and Agency OIIR for other authorities that may be used in lieu of the Economy Act, such as the Space Act or GETA authorities when the activity may warrant a nonreimbursable agreement. As outlined in prior sections, the standards and process for determining waived costs and other pricing adjustments will be followed when evaluating the activity and reflecting price adjustments on the EPR.

4.4.2 Considerations for Pricing CSLA Agreements. Refer to Appendix F. Commercial Space Launch Act Agreement Pricing. To determine applicability of CSLA, consult with Agency OGC/Center OCC and the Center CFO. Where CSLA is used for out-grant of real property, refer also to NID 9091.1. Indirect cost are identified as excluded cost in a pricing adjustment column of the EPR and are subject to Center CFO approval. Costs not charged the partner for more than the estimated indirect cost are subject to the Agency OCFO approval.

4.4.3 Considerations for Pricing Out-Grant of Real Property Agreements. The pricing methodology and related pricing adjustments will be based on the authority under which the agreement is executed. Refer to NID 9091.1.

4.4.4 Considerations for Pricing Rental Quarters and Related Facilities. Refer to NID 9091.1.



| TOC | Preface | Chapter1 | Chapter2 | Chapter3 | Chapter4 | AppendixA | AppendixB | AppendixC | AppendixD | AppendixE | AppendixF | AppendixG | ALL |
 
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