[Code of Federal Regulations]
[Title 48, Volume 6]
[Revised as of October 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR1515.404-470]

[Page 26-27]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
               CHAPTER 15--ENVIRONMENTAL PROTECTION AGENCY
 
PART 1515_CONTRACTING BY NEGOTIATION--Table of Contents
 
                     Subpart 1515.4_Contract Pricing
 
Sec. 1515.404-470  Policy.

    (a) The Agency's policy is to utilize profit to attract contractors 
who possess talents and skills necessary to the accomplishment of the 
objectives of the Agency, and to stimulate efficient contract 
performance. In negotiating profit/fee, it is necessary that all 
relevant factors be considered, and that fair and reasonable amounts be 
negotiated which give the contractor a profit objective commensurate 
with the nature of the work to be performed, the contractor's input to 
the total performance, and the risks assumed by the contractor.
    (b) The purpose of EPA's structured approach is:
    (1) To provide a standard method of evaluation;
    (2) To ensure consideration of all relevant factors;
    (3) To provide a basis for documentation and explanation of the 
profit or fee negotiation objective; and

[[Page 27]]

    (4) To allow contractors to earn profits commensurate with the 
assumption of risk.
    (c) The profit-analysis factors prescribed in the EPA structured 
approach for analyzing profit or fee include those prescribed by FAR 
15.404(d)(1), and additional factors authorized by FAR 15.404(d)(2) to 
foster achievement of program objectives. These profit or fee factors 
are prescribed in 1515.404-471.