35.017-5 Terminating an FFRDC
Source: FAR 35.017-5 on acquisition.gov
When an agency no longer needs an FFRDC, it must either justify transferring sponsorship to another agency or phase out the FFRDC entirely.
Overview
FAR 35.017-5 outlines the procedures for terminating a Federally Funded Research and Development Center (FFRDC) when the sponsoring agency no longer requires its services. The regulation provides two primary options: transferring sponsorship to another government agency if there is a justified need, or phasing out the FFRDC if no transfer occurs. This ensures that FFRDCs continue only when there is a valid government requirement and that resources are not expended on unnecessary operations.
Key Rules
- Transfer of Sponsorship
- If the original sponsor no longer needs the FFRDC, sponsorship may be transferred to another government agency, provided there is appropriate justification.
- Phase-Out Requirement
- If the FFRDC is not transferred, it must be phased out, effectively ending its operations.
Responsibilities
- Contracting Officers: Must ensure proper justification for any transfer of sponsorship and oversee the phase-out process if no transfer occurs.
- Contractors (FFRDC Operators): Must comply with phase-out instructions or facilitate the transfer as directed.
- Agencies: Must document the need for transfer or initiate phase-out procedures when the FFRDC is no longer required.
Practical Implications
- This section ensures that FFRDCs are only maintained when there is a clear government need, preventing unnecessary expenditures.
- Contracting professionals must be prepared to justify transfers or manage orderly phase-outs, including compliance with all related documentation and transition requirements.
- Common pitfalls include inadequate justification for transfer or failure to properly phase out operations, which can lead to compliance issues or wasted resources.
When a sponsor’s need for the FFRDC no longer exists, the sponsorship may be transferred to one or more Government agencies, if appropriately justified. If the FFRDC is not transferred to another Government agency, it shall be phased out.