Page:United States Statutes at Large Volume 106 Part 6.djvu/563

 PUBLIC LAW 102-588—NOV. 4, 1992 106 STAT. 5121 (b) CONTENTS.— In carrying out the assessment required by subsection (a), the Administrator shall consider— (1) technical imcertainty, market dynamics, and equity to both the National Aeronautics and Space Administration and the contractor community^; (2) the use of positive fee incentives reflecting the level of cost, schedule, and performance risk accepted by the contractor; (3) the use of negative fee incentives, including provisions providing for less than full cost recovery for work determined to be defective in materials or workmansnip or which otherwise fail to conform to contract requirements; (4) the appropriate use of rollovers; (5) the appropriate use of retroactive award fee adjustments; (6) the appropriate use of value engineering; (7) the use of warranties to ensure that the end product or a specified subproduct of a contract meets the performance requirements of a contract; (8) the recovery of costs for the replacement or correction of articles which are defective in materials or workmanship, or which otherwise fail to conform to contract requirements; and (9) the appropriate use of performance-based contracting. SEC. 402. PROMULGATION OF REGULATIONS. Within one hundred and eighty days after the completion of the acquisition policy assessment required by section 401, the Administrator, in coordination as necessary with the Office of Federal Procurement Policy, consistent with section 15 of the Office of Federal Procurement Policy Act (41 U.S.C. 413), and the Federal Acquisition Regulation Council, shall initiate a rulemeiking proceeding under section 22 of such Act (41 U.S.C. 418b), on the acumnistration of research and development contracts which pro^se specific changes to National Aeronautics and Space Administration Procurement Regulations and, as necessary. Federal Acquisition Regulations to consider implementing the recommendations of the assessment required by section 401, as well as— (1) the establishment of policies and procedures for the use of performance-based contracts, incorporating positive and/ or negative fee incentives to the maximum extent practicable; and (2) the establishment of policies and procedures— (A) for limiting the use of clauses of the Federal Acquisition Regulations which otherwise obligate the Government to pay the cost of correction of defects in materials and workmanship and work which otherwise fails to conform to contract requirements, and eliminating the use of such clauses where the defect or failure is within the control of the contractor; and (B) to provide for less than full cost recovery for work determined to be defective in materials and workmanship or which otherwise fails to conform to contract requirements. SEC. 403. DEFINITIONS. For the purposes of this title—

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