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FAR and DFARS › DFARS Part 215: Contracting by Negotiation › Subpart 215.4

DFARS 215.404-74 Fee requirements for cost-plus-award-fee contracts.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This section tells contracting officers how to develop a fee objective for cost-plus-award-fee contracts. It directs them to follow certain FAR and DFARS guidance, avoid the weighted guidelines method and alternate structured approach, apply an offset for facilities capital cost of money, and not complete DD Form 1547. It matters to contractors because it shapes how the award fee objective is set in these contracts.

Applies to: Contracting officers developing fee objectives for cost-plus-award-fee contracts

What it requires

  • Follow the guidance in FAR 16.405-2 and 216.405-2
  • Not use the weighted guidelines method or alternate structured approach
  • Apply the offset policy in 215.404-73(b)(2) for facilities capital cost of money, reducing the base fee by that amount
  • Not complete a DD Form 1547

Key terms: cost-plus-award-fee contracts · fee objective · weighted guidelines method · alternate structured approach · facilities capital cost of money

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

In developing a fee objective for cost-plus-award-fee contracts, the contracting officer shall—

(a) Follow the guidance in FAR 16.405-2 and 216.405-2;

(b) Not use the weighted guidelines method or alternate structured approach;

(c) Apply the offset policy in 215.404-73(b)(2) for facilities capital cost of money, i.e., reduce the base fee by the amount of facilities capital cost of money; and

(d) Not complete a DD Form 1547.

Sections it refers to

Sections that refer to it

← 215.404-73 Alternate structured approaches. · 215.404-75 Fee requirements for FFRDCs. →

Rule changes for DFARS Part 215

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.

DFARS 215.404-74 Fee requirements for cost-plus-award-fee contracts · SpendQuery