Memorandum

U.S. Department of Transportation
Office of the Secretary of Transportation


Date: June 14, 1999

ACTION: Class Deviation from FAR 31.205-46(a)(2)

(original signed by)
David J. Litman
Senior Procurement Executive

Procurement Management Council Members


In accordance with Federal Acquisition Regulation (FAR) 1.404, as implemented by TAM 1201.404, I authorize contracting officers to deviate from FAR 31.205-46(a)(2).

Effective January 1, 1999, the computation of Federal Travel Regulations maximum per diem rate limitations was significantly changed. The lodging taxes are now separated from the per diem rates and will be paid separately as a miscellaneous expense. This change could cause contractors to incur significant administrative burden and substantial cost in modifying their system to comply with the new rule.

A change to FAR 31.205-46(a)(2) is being proposed that will delete the maximum per diem rate limitations.

Contracting officers may give contractors the choice of either using the FTR rates and definitions in effect on December 31,1998, OR the FTR rates and definitions that took effect January 1, 1999. The deviation DOES NOT permit contractors to choose between the different per diem rates on a case by case basis. Instead, the contractor must choose between the 1998 FTR definitions and rates or the 1999 definitions and rates for all pertinent contracts related travel.

This deviation remains effective until December 31, 1999, or upon issuance of a FAR change, whichever occurs first. This class deviation was coordinated with the Chairperson of the Civilian Agency Acquisition Council.