About Fee Determinations
EM provides annual contractor fee determinations under its major cost-reimbursable contracts. Performance assessment summaries and fees earned under cost-plus-award-fee (CPAF), cost-plus-incentive-fee (CPIF), and cost-plus-fixed-fee (CPFF) contracts can be found linked in the below table. Links to the DOE field office websites are also provided for additional information.
CPAF contracts are a type of incentive contract where the fee may include a base amount that is fixed at the inception of the contract and an award amount the contractor may earn in whole or in part depending upon performance measured against established criteria. The amount of award fee paid in any given performance period is determined by the government’s evaluation of the contractor’s performance.
CPIF contracts may contain both performance and delivery incentives. CPIF contracts specify a target cost, a target fee, minimum and maximum fee thresholds and a fee adjustment formula. The formula provides for an increase in the fee paid to the contractor above the target fee when total allowable costs are less than the target cost. The formula also provides for a decrease in fee paid to the contractor below the target fee when the total allowable costs exceed the target cost. This variation in fee provides an incentive for the contractor to manage the contract effectively and control costs. If the total allowable costs are greater than or less than the range of costs within which the fee adjustment formula operates, the contractor will earn the minimum or maximum fee, respectively.
CPFF contracts contain a fee that is fixed at the inception of the contract. The fixed fee will not vary with the actual costs that the contractor incurs, but may be adjusted as a result of negotiated changes in the work to be performed under the contract.