# Class Deviation 2011-O0006
# Class Deviation 2011-O0006 -- Utilities Privatization-Class Deviation from FAR Part 31

Status: Active
Date Issued: MAR 31 2011
Signed By: Unknown, Unknown
Scope: Contracting officers awarding qualified contracts in conjunction with the conveyance of a utility system under 10 U.S.C. § 2688
Authority: 10 U.S.C. § 2688, Utility Systems: Conveyance Authority

## Summary

This class deviation permits contracting officers to waive some or all requirements of FAR Part 31 when awarding utility privatization contracts under 10 U.S.C. § 2688, provided the contracts meet specific conditions related to contract type, Cost Accounting Standards applicability and cost treatment. It replaces and updates the prior deviation issued under CPF Tracking Number 2007-000007, expanding permissible contract types and clarifying waiver conditions. The deviation applies retroactively to all qualifying contracts awarded as of August 31, 2010 and remains in effect until incorporated into the DFARS or rescinded.

## Required Contracting Officer Actions

1. Verify that any contract for which this deviation is used meets all conditions in Attachment A, including contract type requirements, CAS exemption or waiver compliance and cost exclusion requirements.
2. For deviations from FAR 31.205-20, make a written determination that allowing interest costs will significantly reduce the Government's costs, that the interest costs are reasonable and that they are associated with capital expenditures under the utility services contract.
3. For deviations from FAR 31.205-41(b)(1), coordinate with the Head of the Contracting Activity to determine whether the CIAC tax is allowable and ensure all required written documentation is completed.
4. Ensure contracts include provisions giving the Government access to all records related to accounting practices and supporting data for estimates of unallowable costs.
5. Report to DPAP/CPF on a quarterly basis, within 30 days of the end of each quarter, any contracts awarded using this class deviation, including contract number, contractor name, date and amount of award and indication of CAS waiver use.

## Affected Provisions and Clauses

### 52.215-2,  (Clause)
- Prescribed in: 15.209(b)
- Change type: MODIFIED
- Action: Modify clause 52.215-2

## Notes

Retroactive applicability: The deviation applies to all qualifying contracts awarded as of August 31, 2010, not only to contracts awarded after the memorandum date.

CAS Board waiver: The CAS Board approved a waiver on September 2, 2004, for contracts under 10 U.S.C. § 2686 (now § 2688). Contractors that do not agree to the waiver conditions remain subject to full CAS requirements if otherwise applicable.

Interest rate cap: When deviating from FAR 31.205-20, allowable interest rates are capped at 600 basis points above the Contract Disputes Act interest rate in effect at the time the contractor makes the capital expenditure.

CIAC tax structure: Contracts should be structured, to the maximum extent practical, to avoid incurring a Contribution in Aid of Construction tax. Allowability of that tax requires HCA approval and written documentation.

Predecessor deviation: This deviation replaces CPF Tracking Number 2007-000007 and updates it to clarify which waiver elements apply to each situation, require contractors to meet all waiver conditions and expand permissible contract types.

## Suggested Questions

You can ask your AI assistant:
- What actions do I need to take for this deviation?
- Does this deviation affect commercial acquisitions under Part 12?
- Which clauses need to be removed from my existing contracts?
- How does this deviation change 52.215-2 specifically?
- Are there any SAM registration implications?

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Source: https://part52.dev
Generated: 2026-03-20
Memorandum: https://www.acq.osd.mil/dpap/policy/policyvault/USA001350-11-DPAP.pdf