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ROUTINE
R 301557Z OCT 24 MID120001502922U
FM CNO WASHINGTON DC
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INFO CNO WASHINGTON DC
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UNCLAS
SUBJ/UNITED STATES NAVY CONTRACT SERVICES GUIDANCE FOR FISCAL YEAR (FY) 2025//
NAVADMIN 223/24
MSGID/GENADMIN/CNO WASHINGTON DC/N8/XXXXXX//
REF/A/DOC/DOD/24JUN21//
REF/B/DOC/DON/08APR22//
NARR/REF A IS DEPARTMENT OF DEFENSE INSTRUCTION (DoDI) 5000.74.
REF B IS SECRETARY OF THE NAVY INSTRUCTION (SECNAVINST) 5000.2G ENCLOSURE(8).
POC/ANGELA TENNYSON/CIV/OPNAV/LOC: WASHINGTON DC/TEL: 240-925-4245/EMAIL:
ANGELA.L.TENNYSON.CIV@US.NAVY.MIL//
POC/JOHN NORTH/CIV/USFF/LOC: NORFOLK, VA/TEL: 757-836-9508/EMAIL:
JOHN.W.NORTH.CIV@US.NAVY.MIL//
POC/KATHY ATOIGUE/CIV/UNIT: USPACFLT/LOC: PEARL HARBOR, HI/808-474-
6414/EMAIL: KATHY.R.ATOIGUE.CIV@US.NAVY.MIL//
POC/FRANCIS TISAK/CIV/DASN(P)/LOC: WASHINGTON DC/TEL: 703-614-9636/EMAIL:
FRANCIS.X.TISAK.CIV@US.NAVY.MIL//
GENTEXT/REMARKS/
1. Purpose. This NAVADMIN updates Service Requirements Review Board (SRRB)
policy (i.e., references (a) and (b)) and provides SRRB guidance for FY 2025
and beyond.
2. Background. The Department of the Navy (DON) executed over $60.6 billion
in contractual services obligations in FY 2024 and is on track to meet or
exceed that amount in FY 2025. With nearly 24 percent of the DON's total
obligation authority spent on contractual services, limited resources dictate
the need to properly review, validate, and prioritize contractual services
requirements. As such, the acquisition of services is a command
responsibility, and DON Activity Commanders are responsible for the
appropriate, efficient, and effective acquisition of services within their
organizations.
a. The SRRB process shall be used to review, validate, and approve
services requirements to accurately inform the budget and acquisition
processes. In accordance with (IAW) reference (a), contract service
requirements shall be vetted through an SRRB process as early in the
services acquisition process as practical, but before the development of an
acquisition strategy and before a procurement request package is transferred
over to a contracting officer for execution.
b. Requirement reviews shall include, but not be limited by, the
following considerations:
(1) Mission Need. Explanation of the mission need for the
requirement and the outcomes to be achieved from acquiring services.
(2) Strategic Alignment. How the requirement for services supports
the broader organizational mission.
(3) Issues and Risks. Both government and contractor issues and
risks impacting the successful execution of fulfilling the requirement, as
well as risks to the DON if the requirement is not validated and approved.
(4) Workforce Analysis. An analysis of the decision to insource or
outsource, including any past decisions and why the requirement cannot be
fulfilled with military or civilian personnel. The analysis shall take
into consideration the Chief of Naval Operations Instruction (OPNAVINST)
1000.16L, Change 3 or succeeding document, "Navy Total Force Manpower
Policies and Procedures."
(5) Relationship to Other Requirements. How the requirement for
services impacts other requirements of the Department of Defense (DoD)
Component (positively or negatively). For information technology (IT)
services, ensure requirements are consistent with enterprise IT strategies.
(6) Prioritization. A determination as to whether the requirement
for services is a lower-priority requirement that can be reduced or
eliminated with savings transferred to higher-priority objectives or mission
requirements.
(7) Contract Functions. A review and identification of contract
and work functions that may be prohibited or require heightened management
attention, including, but not limited to inherently governmental services,
personal services, closely associated with inherently governmental functions
and critical functions.
(8) Metrics. Performance management metrics shall be considered to
the maximum extent practicable during the SRRB review and approval process.
(9) Product and Service Code (PSC) and Object Class Code
(OCC). Correct PSCs and OCCs are required and reported at the contract line
item number level. PSCs and OCCs are essential for spend and budget
analysis, and as such, all personnel shall ensure the accuracy of PSCs and
OCCs in both contracting and accounting systems.
3. Services Defined. Service contracts are defined in the Federal
Acquisition Regulation (FAR) Subpart 37.101 as a "contract that directly
engages the time and effort of a contractor whose primary purpose is to
perform an identifiable task rather than to furnish an end item of
supply." All applicable DON-funded and unfunded services requirements with
an estimated total cumulative value (i.e., base plus all options) of at least
$2 million (M) or greater (unless lower threshold set at command level)
require SRRBs, (including pre-priced contract options), with the following
exceptions:
a. Services listed in Subpart 37.502 of the FAR and services obtained
under contracts with a total cumulative value (i.e., base plus all options)
of less than the command's threshold or less than $2M.
b. Services in direct support of a contingency, humanitarian, or
peacekeeping operation as defined in FAR Subpart 2.101. This exemption
shall apply to the response and initial deployment phase, but shall terminate
as soon as practical based on conditions on the ground and a determination by
the decision authority.
c. Services that are required to respond to and recover from an
emergency or disaster directly supporting an emergency declaration or a major
disaster declaration by the President. This exemption shall apply to the
response and initial recovery phase but shall terminate as soon as practical
during the sustainment phase managing reconstruction and recovery efforts
based on conditions on the ground and a determination by the decision
authority.
d. Research and development services (PSC Category "A").
e. Services from DoD Federally Funded Research and Development
Centers, which are acquired IAW the management structure described in FAR
Subpart 35.017 and DoDI 5000.77; and from DoD University Affiliated Research
Centers (UARCs), which are acquired IAW the management structure described in
the DoD UARC Management Plan.
f. Construction services (PSC Category "Y") and Architecture and
Engineering - Construction (PSC Category "C1").
g. Services that are managed and reviewed as part of defense acquisition
programs under other Adaptive Acquisition Framework pathways (see https
://aaf.dau.edu for additional information on the pathways). Reference
(a) and SRRB requirements may apply to services in the operations and support
phase of these programs at the discretion of the Milestone Decision
Authority.
h. Utilities services (PSC Category "S1").
i. Commercial subscription services including database and information
systems, periodicals, publications, and educational course subscriptions.
j. As a point of clarification only, SRRBs are not required for services
requirements funded fifty percent or more by Foreign Military Sales, Navy
Marine Corps Intranet services, or Global Installation Contract services.
4. Equivalent SRRB Boards and Processes: There are equivalent boards and
processes in place that also serve to review, validate, prioritize, and
approve contractual services requirements. These boards and processes may be
utilized as an SRRB so long as they yield the required results, capture
required SRRB data, and are chaired at the appropriate level as determined by
the designated Flag Officer, General Officer, or Senior Executive Service
Member (FO/GO/SES). The following are examples of existing SRRB equivalent
boards or processes and are considered to satisfy the requirements of
reference (b); therefore, are not required to undergo a separate SRRB:
a. Husbanding services requirements contracts executed based on the
Naval Supply Systems Command (NAVSUP) approved port visit contracting
processes. Port visit requirements shall be reviewed, validated,
prioritized, and approved via the Fleets Port Visit Management Cost Avoidance
process, coordinated by the Fleet Staffs, in conjunction with the Type
Commanders, Numbered Fleet Commander staffs, NAVSUP Fleet Logistics Center
contracting staff, and associated fleet comptroller personnel. Except as
identified in this paragraph, all other provisions of this instruction apply
to husbanding requirements.
b. Fleet/Shore Environmental programs that are reviewed via the
Environmental Program Requirements Web process.
c. Services Requirements contracts for Ship Maintenance, Overhaul or
Repair of vessels executed based on the mandated process in OPNAVINST 4700.7M
to review, validate, prioritize, and approve ship maintenance requirements
from the Fleets, as documented in the annual ship maintenance workload
agreement, jointly signed by the Chief of Naval Operations, the Naval Sea
Systems Command, and the Fleets. Only availabilities included in the ship
maintenance workload agreement and validated through the Ship Maintenance
Model nine step processes will be considered satisfying the SRRB requirements
of this instruction. A SRRB services identification number will not be
applied to ship maintenance, repair or overhaul availabilities.
Additionally, unless an exemption in any other part of section 3 of this
guidance applies, all applicable DON-funded and unfunded services
requirements with an estimated total cumulative value (i.e., base plus all
options) $2M or greater in support of ship maintenance, repair and overhaul
availabilities shall be boarded through SRRB.
d. Review boards that review and approve classified, cryptologic and
intelligence programs or projects.
5. SRRB Requirements
a. The SRRB is a service contract requirement validation process. SRRB
approval does not constitute a commitment to fund or to award a contract.
b. Commands are required to conduct SRRBs as a means of reviewing,
validating, approving, and prioritizing all applicable DON-funded and
unfunded services requirements with an estimated total cumulative value
(i.e., base plus all options) at $2M or greater. Commands may have a lower
threshold than $2M for SRRB review processes. This includes both base
contracts and resulting task orders. However, execution of individual pre-
priced options does not require additional SRRB approval, but still need to
be reported to the SRRB and included in the SRRB Annual Report.
c. The requiring activity is responsible for submitting service contract
requirements to the SRRB regardless of the source of DON funding.
d. Activities receiving funds from another command shall rely on the
originating command's SRRB validation; an additional SRRB review is not
required.
e. SRRBs shall be cross-functional with representation from the
requiring, contracting, and financial management communities as they are
available, and chaired by a FO/GO/SES. All applicable DON-funded and
unfunded services requirements with an estimated total cumulative value
(i.e., base plus all options) at $2M or greater (or the Command threshold,
whichever is lower) shall be approved via a SRRB chaired by a FO/GO/SES, or,
for activities that do not have a FO/GO/SES member assigned, the first FO,
GO, or SES member in the requiring activity's chain of command. Chairmanship
of SRRBs for contractual services requirements below $10M may be delegated in
writing by the first FO, GO, or SES member in the requiring activity's chain
of command to the O-6 or GS-15 level. Copies of written delegation documents
shall be made available for review if requested by staff from the Office of
the Deputy Assistant Secretary of the Navy for Procurement (DASN(P)), which
is responsible for DON oversight of SRRB processes.
6. SRRB Internal Controls.
a. SRRB approvals shall be documented by the SRRB Chair and may include
meeting minutes, action items, or recommendations. Such documents shall be
made available for review if requested by staff from DASN(P), which is
responsible for DON oversight of SRRB processes. Additionally, this
documentation may be requested in conjunction with Command Inspections.
b. All commands shall identify, document, and implement appropriate
internal control processes via the SRRB services identification number to
ensure that funding documents for contract service requirements are not
submitted to contracting officers without SRRB validation.
c. Command Contractual Services Managers (CSMs) facilitate and help
oversee the processes for Services Acquisition including SRRBs. CSMs act as
an action officer on all matters related to contractual services within their
organization. At the direction of the SRRB Chair, CSMs help develop and
facilitate SRRB policies and procedures, document SRRB results, and conduct
oversight to ensure compliance.
d. SRRB results shall be submitted annually by 31 October 2025 to
DASN(P) Senior Services Manager IAW DASN(P)'s format. This calls for Echelon
III and below to submit their results to Echelon II NLT 15 October 2025 to
allow adequate time to meet the DASN(P) annual 31 October deadline.
e. IAW reference (a), the SRRB Chair shall certify that each contractual
services requirement validated through the SRRB process is in compliance with
the standard guidelines found in the DoD Handbook of Contract Function
Checklists for Services Acquisition (May 2018 or successor document), that
all appropriate statutory risk mitigation efforts have been made, and that
the purchase request does not include requirements formerly performed by DoD
civilian employees.
f. It is understood that the SRRB Chair is approving and certifying to
the contractual services requirement as the facts and analysis are known at
the time of SRRB review.
g. Rather than certifying each individual requirement, SRRB Chairs may
make a single certification for all SRRB contractual actions which have been
reviewed and approved during a single SRRB meeting or event. This may be
done through various ways, such as a cover page to SRRB meeting notes, quad
charts, or other SRRB approval documents.
7. Category Management. Commands shall employ management actions that align
with Category Management principles IAW Office of Management and Budget, DoD,
and DON Category Management policies. Category Management refers to the
business practice of buying common goods and services as an enterprise to
help the DON eliminate redundancies, increase efficiency, and deliver more
value and savings from the government's acquisition programs. It requires
participation during all phases of the acquisition process, and includes
collection, sharing and analysis of data within and across commands,
employing cross-departmental teams, and identification and distribution of
best practices and lessons learned. In addition, Category Management
complements efforts of Small Business Specialists to increase small business
contracting opportunities, to include small disadvantaged businesses and
other socioeconomic small businesses. The DON Category Management Program
Office at NAVSUP, working under the direction of DASN(P), is available to
assist with Command Category Management initiatives. They can be contacted
via email at usn.mechanicsburg.navsuphqmech.mbx.doncmpo-
solutions@us.navy.mil.
8. Released by VADM John B. Skillman, DCNO, N8.//
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