You are preparing to price a contract and you see requirements for labor, Other Direct Costs (ODCs), Direct Materials (DMs), and Subcontractors (Subks). All good, but in ODCs you see requirements for OCONUS travel. At first thought you assume that all you need are quotes for airfare, hotel and per diem, but OCONUS travel brings many additional considerations.
This discussion includes information about pricing OCONUS travel requirements. This will also briefly include how some of those costs are treated. Typically, all proposed travel, typically treated as Other Direct Costs (ODCs) with General & Administrative indirect costs in addition to fee, will include quotes for airfare, hotel and per diem, taken from the GSA website. However, when it comes to OCONUS travel, there are many additional considerations.
When the RFP states that OCONUS travel will be required during the contract, it also includes places of performance which can be used in pricing using information from the Department of State (DoS), which gives guidance on allowances (by location and types of allowances), located at: https://aoprals.state.gov/web920/per_diem.asp. For Alaska, Hawaii and US Territories and Possessions, see https://www.defensetravel.dod.mil/site/perdiemCalc.cfm.
Additional potential costs based on RFP requirements are not always applicable, based on location). The DoS allowances are maximum amounts; these are allowances to help pay for the burden of relocating and not meant to completely compensate for them. The below is for purely OCONUS locations (not including Alaska, Hawaii, and US Territories and Possessions):
- Danger pay: based on a percentage of compensation (salary) and location. This can be treated as labor, some companies might treat as an ODC (to control costs).
- Hardship pay: based on a percentage of compensation (salary) and location. This can be treated as labor too, some companies might treat as an ODC (to control costs).
- Cost of Living Allowance (COLA): based on spendable income (derived from salary and family size) and location. As with Danger and Hardship pay, this can be treated as labor or as an ODC.
- Housing Allowance (HOLA): based on family size and location of assignment and treated as an ODC
- Education allowance: based on the number of dependents going to school on and off base and treated as an ODC
- Additional allowances/costs (non-DoS)
a. Shipping of personal items: quotes from shipping companies may be used, the employee will need to estimate weight of goods, typically cars are not shipped
b. Storage in the US: quotes from storage facilities can be used
c. Rest and recuperation trips: airfare quotes can be used
d. Security (home): quotes from the security company can be used
e. Visas, immigration
f. Tax (corporate and personal)
g. Repatriation (cost of moving the employee and family back to the US at the end of the contract)
h. Defense Base Act (DBA) insurance. This is supplemental insurance which is a requirement if the US based employee is going to be working on a US installation. Normally estimated as a unit cost based on the employee’s salary.
Unless solicitation/RFP/RFQ/RPP disallows mark-up on ODCs and travel, typically all ODC costs will include G&A and fee. In some situations, fee is not allowed. Contact us to learn more today!
