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OFFICE OF THE UNDER SECRETARY OF DEFENSE
3000 DEFENSE PENTAGON
WASHINGTON, DC 20301-3000
ACQUISITION
AND SUSTAINMENT
In reply refer to
DARS Tracking Number: 2022-O0001, Revision 1
MEMORANDUM FOR COMMANDER, UNITED STATES CYBER
COMMAND (ATTN: ACQUISITION EXECUTIVE)
COMMANDER, UNITED STATES SPECIAL OPERATIONS
COMMAND (ATTN: ACQUISITION EXECUTIVE)
COMMANDER, UNITED STATES TRANSPORTATION
COMMAND (ATTN: ACQUISITION EXECUTIVE)
DEPUTY ASSISTANT SECRETARY OF THE ARMY
(PROCUREMENT)
DEPUTY ASSISTANT SECRETARY OF THE NAVY
(PROCUREMENT)
DEPUTY ASSISTANT SECRETARY OF THE AIR FORCE
(CONTRACTING)
DEFENSE AGENCY AND DOD FIELD ACTIVITY DIRECTORS
SUBJECT: Class Deviation—Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Effective immediately, this class deviation revises and supersedes Class Deviation 2022-
O0001 issued on October 5, 2021. The revision is necessary to correct the TINA threshold
expressed at 52.214-27 (DEVIATION) paragraph (a).
Effective immediately, contracting officers shall use $2 million, in lieu of $750,000 at
Federal Acquisition Regulation (FAR) 15.403-4(a)(1), as the threshold for obtaining certified
cost or pricing data for the award of a subcontract, at any tier, or a change or modification made
to a prime contract or subcontract, at any tier.
Contracting officers shall use the clauses provided in Attachment 1 of this deviation in
lieu of the following FAR clauses:
52.214-27 Price Reduction for Defective Certified Cost or Pricing Data—
Modifications—Sealed Bidding.
52.214-28, Subcontractor Certified Cost or Pricing Data—Modifications—Sealed
Bidding.
52.215-11, Price Reduction for Defective Certified Cost or Pricing Data—
Modifications.
52.215-12, Subcontractor Certified Cost or Pricing Data.
52.215-13, Subcontractor Certified Cost or Pricing Data—Modifications.
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Contracting officers shall not use Alternate I of FAR 52.214-28, Alternate I of FAR
52.215-12, or Alternate I of FAR 52.215-13. These alternates conflict with the attached
deviation clauses.
Further, contracting officers shall, upon request of the contractor, modify existing
contracts as soon as practicable, without requiring consideration, to incorporate as applicable one
or more of these deviation clauses.
This class deviation implements section 814 of the William M. (Mac) Thornberry
National Defense Authorization Act for Fiscal Year 2021 (Pub. L. 116-283), which modifies 10
U.S.C. 2306a by establishing a $2 million threshold for obtaining certified cost or pricing data
with respect to the award of subcontracts and price adjustments to contracts and subcontracts.
This class deviation remains in effect until it is incorporated into the DFARS, or
otherwise rescinded. My point of contact is Ms. Sara Higgins, who may be reached at
sara.a.higgins2.civ@mail.mil.
John M. Tenaglia
Principal Director,
Defense Pricing and Contracting
Attachment:
As stated
2
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
52.214-27 Price Reduction for Defective Certified Cost or Pricing Data—Modifications—
Sealed Bidding (DEVIATION 2022-O0001).
Use the following clause, when contracting by sealed bidding, in lieu of the clause at FAR
52.214-27, Price Reduction for Defective Certified Cost or Pricing Data-Modifications, in
solicitations and contracts if the contract amount is expected to exceed $2 million:
PRICE REDUCTION FOR DEFECTIVE CERTIFIED COST OR PRICING DATA—
MODIFICATIONS—SEALED BIDDING
(DEVIATION 2022-O0001) (OCT 2021)
(a) This clause shall become operative only for any modification to this contract involving
aggregate increases and/or decreases in costs, plus applicable profits, expected to exceed $2
million on the date of execution of the modification, except that this clause does not apply to a
modification if an exception under FAR 15.403-1(b) applies.
(b) If any price, including profit, negotiated in connection with any modification under this
clause, was increased by any significant amount because (1) the Contractor or a subcontractor
furnished certified cost or pricing data that were not complete, accurate, and current as certified
in its Certificate of Current Cost or Pricing Data, (2) a subcontractor or prospective subcontractor
furnished the Contractor certified cost or pricing data that were not complete, accurate, and
current as certified in the Contractor's Certificate of Current Cost or Pricing Data, or (3) any of
these parties furnished data of any description that were not accurate, the price shall be reduced
accordingly and the contract shall be modified to reflect the reduction. This right to a price
reduction is limited to that resulting from defects in data relating to modifications for which this
clause becomes operative under paragraph (a) of this clause.
(c) Any reduction in the contract price under paragraph (b) of this clause due to defective
data from a prospective subcontractor that was not subsequently awarded the subcontract shall be
limited to the amount, plus applicable overhead and profit markup, by which (1) the actual
subcontract or (2) the actual cost to the Contractor, if there was no subcontract, was less than the
prospective subcontract cost estimate submitted by the Contractor; provided, that the actual
subcontract price was not itself affected by defective certified cost or pricing data.
(d)(1) If the Contracting Officer determines under paragraph (b) of this clause that a price or
cost reduction should be made, the Contractor agrees not to raise the following matters as a
defense—
(i) The Contractor or subcontractor was a sole source supplier or otherwise was in a
superior bargaining position and thus the price of the contract would not have been modified
even if accurate, complete, and current certified cost or pricing data had been submitted;
Page 1 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
(ii) The Contracting Officer should have known that the certified cost or pricing data
in issue were defective even though the Contractor or subcontractor took no affirmative action to
bring the character of the data to the attention of the Contracting Officer;
(iii) The contract was based on an agreement about the total cost of the contract and
there was no agreement about the cost of each item procured under the contract; or
(iv) The Contractor or subcontractor did not submit a Certificate of Current Cost or
Pricing Data.
(2)(i) Except as prohibited by subdivision (d)(2)(ii) of this clause, an offset in an amount
determined appropriate by the Contracting Officer based upon the facts shall be allowed against
the amount of a contract price reduction if—
(A) The Contractor certifies to the Contracting Officer that, to the best of the
Contractor's knowledge and belief, the Contractor is entitled to the offset in the amount
requested; and
(B) The Contractor proves that the certified cost or pricing data were available
before the date of agreement on the price of the contract (or price of the modification) and that
the data were not submitted before such date.
(ii) An offset shall not be allowed if—
(A) The understated data was known by the Contractor to be understated when
the Certificate of Current Cost or Pricing Data was signed; or
(B) The Government proves that the facts demonstrate that the contract price
would not have increased in the amount to be offset even if the available data had been submitted
before the date of agreement on price.
(e) If any reduction in the contract price under this clause reduces the price of items for
which payment was made prior to the date of the modification reflecting the price reduction, the
Contractor shall be liable to and shall pay the United States at the time such overpayment is
repaid—
(1) Interest compounded daily, as required by 26 U.S.C. 6622, on the amount of such
overpayment to be computed from the date(s) of overpayment to the Contractor to the date the
Government is repaid by the Contractor at the applicable underpayment rate effective for each
quarter prescribed by the Secretary of the Treasury under 26 U.S.C. 6621(a)(2); and
Page 2 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
(2) A penalty equal to the amount of the overpayment, if the Contractor or subcontractor
knowingly submitted certified cost or pricing data which were incomplete, inaccurate, or
noncurrent.
(End of clause)
52.214-28 Subcontractor Certified Cost or Pricing Data—Modifications—Sealed Bidding
(DEVIATION 2022-O0001).
Use the following clause, when contracting by sealed bidding, in lieu of the clause at FAR
52.214-28, Price Reduction for Defective Certified Cost or Pricing Data-Modifications, in
solicitations and contracts if the contract amount is expected to exceed $2 million:
SUBCONTRACTOR CERTIFIED COST OR PRICING DATA—MODIFICATIONS—
SEALED BIDDING
(DEVIATION 2022-O0001) (OCT 2021)
(a) The requirements of paragraphs (b) and (c) of this clause shall—
(1) Become operative only for any modification to this contract involving aggregate
increases and/or decreases in costs, plus applicable profits, expected to exceed $2 million on the
date of execution of the modification, and
(2) Be limited to such modifications.
(b) Before awarding any subcontract expected to exceed $2 million, on the date of agreement
on price or the date of award, whichever is later, or before pricing any subcontract modifications
involving aggregate increases and/or decreases in costs, plus applicable profits, expected to
exceed $2 million, the Contractor shall require the subcontractor to submit certified cost or
pricing data (actually or by specific identification in writing), as part of the subcontractor’s
proposal in accordance with Federal Acquisition Regulation (FAR) 15.408, Table 15-2 (to
include any information reasonably required to explain the subcontractor’s estimating process
such as the judgmental factors applied and the mathematical or other methods used in the
estimate, including those used in projecting from known data, and the nature and amount of any
contingencies included in the price), unless an exception under FAR 15.403-1(b) applies. If the
$2 million threshold for submission of certified cost or pricing data specified is adjusted for
inflation as set forth in FAR 1.109(a), then pursuant to FAR 1.109(d) the changed threshold
applies throughout the remaining term of the contract, unless there is a subsequent threshold
adjustment.
(c) The Contractor shall require the subcontractor to certify in substantially the form
prescribed in subsection 15.406-2 of the Federal Acquisition Regulation that, to the best of its
knowledge and belief, the data submitted under paragraph (b) above were accurate, complete,
Page 3 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
and current as of the date of agreement on the negotiated price of the subcontract or subcontract
modification.
(d) The Contractor shall insert the substance of this clause, including this paragraph (d), in
each subcontract that, when entered into, exceeds $2 million.
(End of clause)
52.215-11 Price Reduction for Defective Certified Cost or Pricing Data—Modifications
(DEVIATION 2022-O0001).
Use the following clause, when contracting by negotiation, in lieu of the clause at FAR 52.215-
11, Price Reduction for Defective Certified Cost or Pricing Data-Modifications, in solicitations
and contracts when it is contemplated that certified cost or pricing data will be required from the
contractor or any subcontractor for the pricing of contract modifications and FAR clause 52.215-
10, Price Reduction for Defective Certified Cost or Pricing Data, has not been included:
PRICE REDUCTION FOR DEFECTIVE CERTIFIED COST OR PRICING DATA—
MODIFICATIONS
(DEVIATION 2022-O0001) (OCT 2021)
(a) This clause shall become operative only for any modification to this contract
involving a pricing adjustment expected to exceed $2 million on the date of execution of the
modification, except that this clause does not apply to any modification if an exception under
Federal Acquisition Regulation (FAR) 15.403-1(b) applies.
(b) If any price, including profit or fee, negotiated in connection with any modification under
this clause, or any cost reimbursable under this contract, was increased by any significant amount
because—
(1) The Contractor or a subcontractor furnished certified cost or pricing data that were
not complete, accurate, and current as certified in its Certificate of Current Cost or Pricing Data;
(2) A subcontractor or prospective subcontractor furnished the Contractor certified cost
or pricing data that were not complete, accurate, and current as certified in the Contractor’s
Certificate of Current Cost or Pricing Data; or
(3) Any of these parties furnished data of any description that were not accurate, the
price or cost shall be reduced accordingly and the contract shall be modified to reflect the
reduction. This right to a price reduction is limited to that resulting from defects in data relating
to modifications for which this clause becomes operative under paragraph (a) of this clause.
Page 4 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
(c) Any reduction in the contract price under paragraph (b) of this clause due to defective
data from a prospective subcontractor that was not subsequently awarded the subcontract shall be
limited to the amount, plus applicable overhead and profit markup, by which—
(1) The actual subcontract price; or
(2) The actual cost to the Contractor, if there was no subcontract awarded, was less than
the prospective subcontract cost estimate submitted by the Contractor; provided, that the actual
subcontract price was not itself affected by defective certified cost or pricing data.
(d)(1) If the Contracting Officer determines under paragraph (b) of this clause that a price or
cost reduction should be made, the Contractor agrees not to raise the following matters as a
defense:
(i) The Contractor or subcontractor was a sole source supplier or otherwise was in a
superior bargaining position and thus the price of the contract would not have been modified
even if accurate, complete, and current certified cost or pricing data had been submitted.
(ii) The Contracting Officer should have known that the certified cost or pricing data
in issue were defective even though the Contractor or subcontractor took no affirmative action to
bring the character of the data to the attention of the Contracting Officer.
(iii) The contract was based on an agreement about the total cost of the contract and
there was no agreement about the cost of each item procured under the contract.
(iv) The Contractor or subcontractor did not submit a Certificate of Current Cost or
Pricing Data.
(2)(i) Except as prohibited by subdivision (d)(2)(ii) of this clause, an offset in an amount
determined appropriate by the Contracting Officer based upon the facts shall be allowed against
the amount of a contract price reduction if—
(A) The Contractor certifies to the Contracting Officer that, to the best of the
Contractor’s knowledge and belief, the Contractor is entitled to the offset in the amount
requested; and
(B) The Contractor proves that the certified cost or pricing data were available
before the “as of” date specified on its Certificate of Current Cost or Pricing Data, and that the
data were not submitted before such date.
(ii) An offset shall not be allowed if—
Page 5 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
(A) The understated data were known by the Contractor to be understated
before the “as of” date specified on its Certificate of Current Cost or Pricing Data; or
(B) The Government proves that the facts demonstrate that the contract price
would not have increased in the amount to be offset even if the available data had been submitted
before the “as of” date specified on its Certificate of Current Cost or Pricing Data.
(e) If any reduction in the contract price under this clause reduces the price of items for
which payment was made prior to the date of the modification reflecting the price reduction, the
Contractor shall be liable to and shall pay the United States at the time such overpayment is
repaid—
(1) Interest compounded daily, as required by 26 U.S.C. 6622, on the amount of such
overpayment to be computed from the date(s) of overpayment to the Contractor to the date the
Government is repaid by the Contractor at the applicable underpayment rate effective for each
quarter prescribed by the Secretary of the Treasury under 26 U.S.C. 6621(a)(2); and
(2) A penalty equal to the amount of the overpayment, if the Contractor or subcontractor
knowingly submitted certified cost or pricing data that were incomplete, inaccurate, or
noncurrent.
(End of clause)
52.215-12 Subcontractor Certified Cost or Pricing Data (DEVIATION 2022-O0001).
Use the following clause, in lieu of the clause at FAR 52.215-12, Price Reduction for Defective
Certified Cost or Pricing Data-Modifications, in solicitations and contracts when FAR clause
52.215-10, Price Reduction for Defective Certified Cost or Pricing Data, is included:
SUBCONTRACTOR CERTIFIED COST OR PRICING DATA (DEVIATION 2022-O0001)
(OCT 2021)
(a) Before awarding any subcontract expected to exceed $2 million, on the date of agreement
on price or the date of award, whichever is later; or before pricing any subcontract modification
involving a pricing adjustment expected to exceed $2 million, the Contractor shall require the
subcontractor to submit certified cost or pricing data (actually or by specific identification in
writing), in accordance with Federal Acquisition Regulation (FAR) 15.408, Table 15-2 (to
include any information reasonably required to explain the subcontractor’s estimating process
such as the judgmental factors applied and the mathematical or other methods used in the
estimate, including those used in projecting from known data, and the nature and amount of any
contingencies included in the price), unless an exception under FAR 15.403-1(b) applies. If the
$2 million threshold for submission of certified cost or pricing data is adjusted for inflation as set
Page 6 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
forth in FAR 1.109(a), then pursuant to FAR 1.109(d) the changed threshold applies throughout
the remaining term of the contract, unless there is a subsequent threshold adjustment.
(b) The Contractor shall require the subcontractor to certify in substantially the form
prescribed in FAR 15.406-2 that, to the best of its knowledge and belief, the data submitted
under paragraph (a) of this clause were accurate, complete, and current as of the date of
agreement on the negotiated price of the subcontract or subcontract modification.
(c) In each subcontract that, when entered into, exceeds $2 million, the Contractor shall insert
either—
(1) The substance of this clause, including this paragraph (c), if paragraph (a) of this
clause requires submission of certified cost or pricing data for the subcontract; or
(2) The substance of the clause at 52.215-13, Subcontractor Certified Cost or Pricing
Data—Modifications (DEVIATION 2022-O0001).
(End of clause)
52.215-13 Subcontractor Certified Cost or Pricing Data—Modifications (Deviation 2022-
O0001).
Use the following clause in lieu of the clause at FAR 52.215-13, Price Reduction for Defective
Certified Cost or Pricing Data—Modifications, in solicitations and contracts when clause
52.215-11, Price Reduction for Defective Certified Cost or Pricing Data—Modifications
(DEVIATION 2022-O0001) is included:
SUBCONTRACTOR CERTIFIED COST OR PRICING DATA—MODIFICATIONS
(DEVIATION 2022-O0001) (OCT 2021)
(a) The requirements of paragraphs (b) and (c) of this clause shall—
(1) Become operative only for any modification to this contract involving a pricing
adjustment expected to exceed $2 million on the date of execution of the modification; and
(2) Be limited to such modifications.
(b) Before awarding any subcontract expected to exceed $2 million, on the date of agreement
on price or the date of award, whichever is later; or before pricing any subcontract modification
involving a pricing adjustment expected to exceed $2 million, the Contractor shall require the
subcontractor to submit certified cost or pricing data (actually or by specific identification in
writing), in accordance with Federal Acquisition Regulation (FAR) 15.408, Table 15-2 (to
Page 7 of 8
Attachment 1
Class Deviation 2022-O0001, Revision 1
Threshold for Obtaining Certified Cost or Pricing Data for
Subcontracts and Price Adjustments
Changes to the text are indicated by a change bar in the right-hand margin.
include any information reasonably required to explain the subcontractor’s estimating process
such as the judgmental factors applied and the mathematical or other methods used in the
estimate, including those used in projecting from known data, and the nature and amount of any
contingencies included in the price), unless an exception under FAR 15.403-1(b) applies. If the
$2 million threshold for submission of certified cost or pricing data is adjusted for inflation as set
forth in FAR 1.109(a), then pursuant to FAR 1.109(d) the changed threshold applies throughout
the remaining term of the contract, unless there is a subsequent threshold adjustment.
(c) The Contractor shall require the subcontractor to certify in substantially the form
prescribed in FAR 15.406-2 that, to the best of its knowledge and belief, the data submitted
under paragraph (b) of this clause were accurate, complete, and current as of the date of
agreement on the negotiated price of the subcontract or subcontract modification.
(d) The Contractor shall insert the substance of this clause, including this paragraph (d), in
each subcontract that exceeds $2 million on the date of agreement on price or the date of award,
whichever is later.
(End of clause)
Page 8 of 8