51. Deficiencies Across Multiple Systems

Comment: A respondent suggested that language be added to the final rule that makes it clear that if one specific deficiency relates to more than one business system, that withholding not be calculated twice for the same deficiency, as this would in essence represent double counting and would produce an inequitable result.

Response: Withholds are based on deficient business systems. A significant deficiency may result in the disapproval of multiple business systems resulting in a withhold applied against each system up to a maximum withhold of 10 percent per contract. Specific system criteria or requirements exist for each of the business systems. If a significant deficiency exists, then the ability to rely on information produced by the system is materially affected and the contracting officer is required to issue a final determination with a notice to withhold payments. There is a connection between the payment withhold and the business system. If similar significant deficiencies are determined to exist for multiple contractor business systems according to the published criteria for those systems, then a withhold could apply for each business system required under the contract.