25.  Dollar Limitations

Comment: The lack of dollar limitations at the contract level will lead to payment withholdings that exceed the amount required to protect the government. The value withheld at the contract level should be limited to $100,000 (and at subsequent thresholds of $250,000, $500,000, and $1,000,000) until authorization is received from DCMA headquarters. The approval of payment withholdings above the thresholds should be based on evidence that actual risk or harm in excess of the limit exists.

Response: To ensure sufficient mitigation of the Government's risk, the interim rule provides the contracting officer with the sole discretion to withhold payments from one or more contracts containing the clause at 252.242-7005, Contractor Business Systems. Contracting officers will select one or more contracts from which payments will be withheld. In selecting the contract or contracts from which to withhold payments, the contracting officer shall ensure that the total amount of payment withholding does not exceed 10 percent of the total amount billed.