Fixed Fee or Profit. The allowable lump sum for fixed fee or profit iswill primarily based onconsider the degree of responsibility to be assumed by the consultant and a firm’s audited FAR Overhead Rate in relation to the market values. Other considerations that may enter into the negotiation include: • financial and professional investments to be required of the consultant; • the record of the consultant in performance of this type of work and services; • the extent, Scope of Work, complexity, character, date of beginning and duration of work and services; • the degree of responsibility to be assumed by the consultant; • the consultant's normally expected return for such work and services; • the conditions under which they are expected to be performed; and • other factors as contemplated at the time of submission of the proposal. Additional limitations to fixed fee or profit may be addressed by an IO’s Operating Procedures. In October of each year, the Contract Management Section will determine the mean and distribution of consultant office and field Overhead Rates, weighted by payouts. This will establish the market value for Overhead Rates and profit. Profit is incentivized such that the lower the Overhead Rate, the greater the Profit Factor. Separate analyses will be performed for office and field overhead rates. Profit is applied to both Direct Labor (DL) and Overhead (OH), and total payout is calculated as follows: A table listing each firm’s profit factors will be created and stored in the ECMS File Cabinet. This table will be accessible to Department Project Managers and the Contract Management Section. The table will also provide the “ECMS Factors” which are necessary to account for current ECMS programming which applies profit only to Direct Labor. The ECMS Factor is calculated as follows: Note: If Overhead Rate < 50%, then ECMS Factor = Profit x 1.5 If Overhead Rate > 250%, then ECMS Factor = Profit x 3.5 Overhead Rates, as described in Section 3.6.4, shall be governed by provisions set forth in FAR Part 31 and are based on a FAR Audit. A consultant’s Profit Factors will not be adjusted during the course of the year, even if a different Overhead Rate is determined or submitted. Appendix 4B-1 provides guidance for including fee in a supplement. If it is necessary to include fee in a supplement to an existing agreement with a Cost Plus Fixed Fee Method of Payment, the Profit Factors defined for the consultant, for the current year, will be used for the supplement.
Fixed Fee or Profit. The allowable lump sum for fixed fee or profit will primarily consider the degree of responsibility to be assumed by the consultant. Other considerations that may enter into the negotiation include: • financial and professional investments to be required of the consultant; • the record of the consultant in performance of this type of work and services; • the extent, Scope of Work, complexity, character, date of beginning and duration of work and services; • the degree of responsibility to be assumed by the consultant; • the consultant's normally expected return for such work and services; • the conditions under which they are expected to be performed; and • other factors as contemplated at the time of submission of the proposal. Additional limitations to fixed fee or profit may be addressed by an IO’s Operating Procedures. Chart 3.3 - MAXIMUM ALLOWABLE FEE Service Provided Profit added on Direct Payroll and Escalation Cost Plus Fixed Lump Sum Cost per Unit of work Specific Rate Final Design Work and Services for PS&E submissions 0.235 0.282 --- --- Shop Drawing Review, Consultation During Construction --- --- --- 0.235 Preliminary Engineering & Environmental Work and Services 0.212 --- --- --- Conceptual Design for Design- build Project 0.212 --- --- --- Field Surveys only 0.212 0.235 0.235 --- Studies (Feasibility, traffic, etc.) 0.188 --- --- --- Bridge Inspection/Analysis 0.235 0.282 0.282 --- Right-of-Way Acquisitions/ Negotiation 0.212 --- --- --- Photogrammetric Work --- 0.235 --- --- Repetitive Work & Services --- --- 0.235 --- Utility Designation And Locating --- --- 0.212 --- Environmental Studies --- --- --- 0.212 Geotechnical Studies --- --- --- 0.235 Review Activities** 0.212 --- --- 0.212 High Occupancy Permit Review --- --- --- 0.212 High Occupancy Permit Inspection --- --- --- 0.200 Construction Inspection --- --- --- 0.200 Construction Consultant Management Project Manager --- --- --- 0.235 * Design Consultant Management Project Manager 0.212 --- --- 0.235 * Design Consultant Management Project Manager should be used as indicated in Section 2.2.3. ** For activities under Cost Plus Fixed Fee Method of Payment that function like a Specific Rate of Compensation, refer to Section 4.5.3. If circumstances allow combining phases of work and services under the same Consultant Agreement Part, the fixed fee should be weighted in proportion to the direct payroll for individual tasks that can be positively identified with the distinct phases. For a Spe...
