I have always maintained that when employees, after being hired by an organization, are engaged in relocation activities under a Federal contract, time relating to their relocation activities(such as house closings)are allowable costs. In the absence of special provisions allowing direct charges for such activity under the contract, at the very least, they should be allowable under G&A if the G&A contains such cost.FAR 31.202-35 seems to be silent, specifically, on this issue. Any thoughts?

By Philip on Friday, December 21, 2001 - 12:04 pm:

Les,

Relocation reimbursement is not an easy issue to address. Allowing for relocation to be reimbursed in all cases is unrealistic.

I work at the Hanford Site in Richland Washington. Some contractors reimburse for relocation travel when hiring and some do not, it seems to have a lot to do with the type of contract and the position. Some rules are in the prime contract, but the final decisions are made by HR and other staff. The decision also hinges on other considerations such as whether there is available budget.

Regards Philip

By joel hoffman on Friday, December 21, 2001 - 12:15 pm:

Les, G&A expenses must "allowable", just as direct expenses must be allowable. Are you asking whether house closing costs are "allowable" or are you asking whether they can be treated as indirect or direct costs? The rules covering indirect vs. direct are not always addressed in 31.205. Those are addressed in 31.203 and in DCAA audit guidance, etc. happy sails! joel

By Les Herring on Friday, December 21, 2001 - 12:56 pm:

Maybe I didn't make myself clear. What I mean is the time the individual, who is under a relocation agreement, is required to spend in accomplishing certain tasks. For instance, he/she is relocated under a Federal contract and he/she must take time from an 8 hour day (say 3 hours) to close on a home (notwithstanding exempt/non-exempt employee issues)Absent a specific provision in the contract whereby the charging practice is defined (and I have seen them)it should be permissable to place those three hours in the G&A pool (if the G&A addresses this practice)Guess it might fall into the area of reasonable costs rather than allowable. Just curious how other have handled this. Tks

By Vern Edwards on Friday, December 21, 2001 - 02:28 pm:

Les:

Couldn't you consider such costs under "costs of finding a new home," FAR 31.205-35(a)(1)?

Whether those costs are allocable as direct or indirect would probably depend upon the terms of the contract in question and the contractor's normal accounting practices.

Les:

Correction: I meant 31.205-35(a)(2).

By les herring on Friday, December 21, 2001 - 02:54 pm:

Thanks, y'all. Think I can put the argument together to make my case. Great forum here and some good people. Look forward to some interesting discussions-Have a great Christmas.
Joel, do you sail?

By joel on Friday, December 21, 2001 - 03:24 pm:

Les, I would affirm Vern's advice that, if the expense is allowable, whether as a direct or indirect expense largely depends upon your normal accounting practices.

happy sails from an former Air Force Officer, current Army employee and sailing fanatic... (although sailing around my present home waters in the Northern Alabama area is like sailing in a bathtub, in comparison with my old stomping grounds on the Gulf Coast and the Gulf !

By Les on Friday, December 21, 2001 - 05:32 pm:

Know what you mean Joel. I'm in Oklahoma now. But am a baby-boomed ex-surfer from California so couldn't get much further from the ocean then that.