DODI 5000.02 Enclosure 10: Cost Estimating and Reporting

1. PURPOSE
This enclosure describes the primary tools and methods that the DoD uses to ensure that the most cost-effective solution to a validated capability need is chosen, budgets are adequate, and viable cost saving opportunities through multi-year contracting are exploited.
2. COST ESTIMATION

a. Per 10 U.S.C. 2334 (Reference (h)) and DoD Directive 5105.84 (Reference (bp)), the DCAPE The CAPE Director (DCAPE) reports directly to the Secretary and Deputy Secretary of Defense, providing independent analytic advice on all aspects of the defense program, including alternative weapon systems and force structures, the development and evaluation of defense program alternatives, and the cost-effectiveness of defense systems. CAPE is responsible for the management of the Department’s programming processes and annual program review. The ultimate product of the program review is the Future Years Defense Program - the authoritative statement of what the Department plans, year by year, in terms of force structure (how many ships, brigades and divisions, aircraft squadrons and wings, etc., we will operate), procurement (how many ships, tanks, aircraft, missiles, etc., we will buy), manpower (how many people, military and civilian, we plan to employ in each of the services and defense agencies), other supporting programs (such as R&D and military construction), and what it will all cost. CAPE helps to shape the force in the long-term by providing analysis and advice on resource issues to the Joint Requirements Oversight Council as well as formulating study guidance for analyses of alternatives for major defense acquisition programs. In accordance with Table 2, DCAPE assesses Analysis of Alternatives (AoAs) for ACAT ID/IAM programs. DCAPE may be the approval authority for AoA Study Guidance and AoA Study Plans; DCAPE is the approval authority for Independent Cost Estimates for ACAT ID and IAM programs. Enclosure 9 describes DCAPE roles and responsibilities in Analysis of Alternatives. DCAPE responsibilities are identified in DoD Directive 5105.84. provides policies and procedures for the conduct of cost estimates and cost analyses for all DoD acquisition programs, including issuance of guidance relating to program life-cycle cost estimation and risk analysis; reviews cost estimates and cost analyses conducted in connection with Major Defense Acquisition Programs (MDAPs) An acquisition program that is designated by the Under Secretary of Defense for Acquisition, Technology and Logistics (USD(AT&L)) as an MDAP; or is estimated to require an eventual total expenditure for research, development, test, and evaluation (RDT&E), including all planned increments, of more than $480 million in Fiscal Year (FY) 2014 constant dollars or, for procurement, including all planned increments, of more than $2.79 billion in FY 2014 constant dollars. GAO-16-329SP, Assessment of Selected Weapon Programs, Mar 2016 FY17 Program Acquisition Cost By Weapon System, Feb 2016 and Major Automated Information System (MAIS) programs; and leads the development of DoD cost community training. The procedures associated with these policies are detailed in DoD Instruction 5000.73 (Reference (w)), DoD Manual 5000.04-M-1 (Reference (at)), and the Office of the Secretary of Defense, Cost Assessment and Program Evaluation, “Operating and Support Cost-Estimating Guide” (Reference (bq)).

(1) The DCAPE conducts Independent Cost Estimates (ICEs) and cost analyses for MDAPs for which the Under Secretary of Defense for Acquisition, Technology and Logistics (USD(AT&L)) is the MDA and as requested by the MDA for other MDAPs:

(a) In advance of any decision to grant Milestone A or Milestone B approval or entry into LRIP The first part of the Production and Development (P&D) phase. LRIP is intended to result in completion of manufacturing development in order to ensure adequate and efficient manufacturing capability and to produce the minimum quantity necessary to provide production or production-representative articles for Initial Operational Test and Evaluation (IOT&E); establish an initial production base for the system; and permit an orderly increase in the production rate for the system, sufficient to lead to Full-Rate Production (FRP) upon successful completion of operational (and live-fire, where applicable) testing. or full-rate production.

(b) In advance of any certification pursuant to 10 U.S.C. 2433a (Reference (h)).

(c) At any other time considered appropriate by the DCAPE or upon the request of the MDA.

(2) The DCAPE conducts ICEs and cost analyses for MAIS programs for which the USD(AT&L) is the MDA and as requested by the MDA for other MAIS programs:

(a) In advance of any report pursuant to paragraph (f) of 10 U.S.C. 2445c (Reference (h)).

(b) At any other time considered appropriate by the DCAPE or upon the request of the MDA.

(3) The DCAPE prepares an ICE for Acquisition Category (ACAT) IC and IAC programs at any time considered appropriate by the DCAPE or upon the request of the USD(AT&L) or the MDA.

(4) For MDAPs for which DCAPE does not develop an ICE, the ICE supporting a milestone review decision will be provided to the MDA by the applicable Service Cost Agency or defense agency equivalent following review and concurrence by DCAPE.

(5) DCAPE representatives will meet with representatives from the Service Cost Agency and program office no later than 180 calendar days before the scheduled Development RFP Release Decision Point to determine what cost analysis, if any, will be presented at the decision review and who will be responsible for preparing the cost analysis. Following the meeting, DCAPE will notify the MDA of the type of cost analysis that will be presented. The type of cost analysis will vary depending on the program and the information that is needed to support the decision to release the RFP. For some programs, no new cost analysis may be necessary, and the DCAPE representative will present the Milestone A ICE or an update to the Milestone A ICE. In other cases, the cost analysis may be a cost assessment or a complete ICE.

(6) The DCAPE reviews all cost estimates and cost analyses conducted in connection with MDAPs and MAIS programs, including estimates of operating and support (O&S) costs for all major weapon systems. To facilitate the review of cost estimates, the DCAPE receives the results of all cost estimates and cost analyses and associated studies conducted by the DoD Components for MDAPs and MAIS programs.

(7) The DCAPE, DoD Components, and Service Cost Agencies will be provided timely access to any records and data in the DoD (including the records and data of each military department and defense agency, to include classified, unclassified, and proprietary information) it considers necessary to review cost analyses and conduct the ICEs and cost analyses described in sections 2 and 3 of this enclosure.

(8) For MDAP An acquisition program that is designated by the USD(AT&L) as an MDAP; or is estimated to require an eventual total expenditure for RDT&E including all planned increments, of more than $480 million in FY 2014 constant dollars or, for procurement, including all planned increments, of more than $2.79 billion in FY 2014 constant dollars. and MAIS programs, the DCAPE participates in the discussion of issues related to and/or differences between competing program cost estimates, comments on methodologies employed and the estimate preparation process, coordinates on the cost estimate used to support establishment of baselines and budgets, and participates in the consideration of any decision to request authorization of a multi-year procurement contract for an MDAP.

(9) The documentation of each MDAP or MAIS program cost estimate prepared by DCAPE and/or Service or Agency includes the elements of program cost risk identified and accounted for, how they were evaluated, and possible mitigation measures. DCAPE then assesses the proposed program’s baseline and associated program budget’s ability to provide the necessary high degree of confidence that the program can be completed without the need for significant adjustment to future program budgets. If the MDAP or MAIS program baseline or budget determined by DCAPE as appropriately high confidence is not adopted by the MDA, the MDA will document the rationale for the decision. For MDAPs, the next Selected Acquisition Report prepared in compliance with 10 U.S.C. 2432 (Reference (h)), and for MAIS programs, the next quarterly report prepared in compliance with 10 U.S.C. 2445c will disclose the confidence level used in establishing the cost estimate for the MDAP or MAIS program and the rationale for selecting the confidence level.

(10) In addition to O&S cost estimates included in the ICEs conducted at the reviews identified in paragraphs 2a(1) through 2a(4) of this enclosure, Military Departments must update estimates of O&S costs periodically throughout the life cycle of a major weapon system to determine whether preliminary information and assumptions remain relevant and accurate and to identify and record reasons for variances. Further, an independent review of O&S cost estimates must be conducted at post-Initial Operational Capability In general, attained when selected units and/or organizations in the force structure scheduled to receive a new system have received it and have the ability to employ and maintain it. The specifics for any particular system IOC are defined in that system’s Capability Development Document (CDD) and Capability Production Document (CPD). reviews. Each O&S cost estimate must be compared to earlier cost estimates and the program’s O&S affordability cap, and, as appropriate, this information will be used to update the life-cycle affordability analysis provided to the MDA and requirements validation authority. This comparison must identify the reasons for significant changes and categorize those reasons into external and internal factors.

b. The MDA The Milestone Decision Authority (MDA) is the designated individual with overall responsibility for a program. The MDA shall have the authority to approve entry of an acquisition program into the next phase of the acquisition process and shall be accountable for cost, schedule, and performance reporting to higher authority, including Congressional reporting. may request that the DCAPE, within the DCAPE’s discretion, develop cost assessments for any other program regardless of its ACAT.

c. Per 10 U.S.C. 2434 (Reference (h)), the MDA may not approve the engineering and manufacturing development or the production and deployment of an MDAP unless an independent estimate of the full life-cycle cost of the program, prepared or approved by the DCAPE, has been considered by the MDA.

d. The DoD Component will develop a DoD Component Cost Estimate that covers the entire life cycle of the program for all MDAPs prior to Milestone A, B, and C reviews and the Full-Rate Production Decision; and for all MAIS programs at any time an Economic Analysis is due.

e. The DoD Component and the Service Cost Agency will establish a documented DoD Component Cost Position that covers the entire life cycle of the program for all MDAPs and MAIS programs prior to the Milestone A, B, and C reviews, and the Full-Rate Production Decision or Full Deployment Decision Review. The DoD Component Cost Position must be signed by the appropriate DoD Component Deputy Assistant Secretary for Cost and Economics (or defense agency equivalent) and must include a date of record.

f. At the Milestone A, B, and C reviews and for the Full-Rate Production Decision Milestone Decision Authority (MDA) review to assess the results of Initial Operational Test and Evaluation (IOT&E) and initial manufacturing and deployment to determine whether or not to approve proceeding to Full-Rate Production or Full Deployment. Continuing into Full-Rate Production or Full Deployment requires demonstrated control of the manufacturing process, acceptable performance and reliability, and the establishment of adequate sustainment and support. or Full Deployment Decision Decision made by the Milestone Decision Authority (MDA) of a Major Automated Information System (MAIS) acquisition program authorizing an increment of the program to deploy software for operational use. review, the DoD Component must fully fund the program to the Component Cost Position in the current FYDP, or commit to full funding of the cost position in the next FYDP, with identification of specific offsets to address any funding shortfalls that may exist in the current FYDP. The Component Acquisition Executive and the DoD Component Chief Financial Officer must endorse and certify in the Full Funding Certification Memorandum that the FYDP fully funds, or will fully fund, the program consistent with the DoD Component Cost Position. If the program concept evolves after a milestone review, the Service Cost Agency may update the DoD Component Cost Position, and the DoD Component may fully fund the program in the FYDP to the updated DoD Component Cost Position.

3. COST ANALYSIS REQUIREMENTS DESCRIPTION (CARD)

The foundation of a sound and credible cost estimate is a well-defined program. The DCAPE The CAPE Director (DCAPE) reports directly to the Secretary and Deputy Secretary of Defense, providing independent analytic advice on all aspects of the defense program, including alternative weapon systems and force structures, the development and evaluation of defense program alternatives, and the cost-effectiveness of defense systems. CAPE is responsible for the management of the Department’s programming processes and annual program review. The ultimate product of the program review is the Future Years Defense Program - the authoritative statement of what the Department plans, year by year, in terms of force structure (how many ships, brigades and divisions, aircraft squadrons and wings, etc., we will operate), procurement (how many ships, tanks, aircraft, missiles, etc., we will buy), manpower (how many people, military and civilian, we plan to employ in each of the services and defense agencies), other supporting programs (such as R&D and military construction), and what it will all cost. CAPE helps to shape the force in the long-term by providing analysis and advice on resource issues to the Joint Requirements Oversight Council as well as formulating study guidance for analyses of alternatives for major defense acquisition programs. In accordance with Table 2, DCAPE assesses Analysis of Alternatives (AoAs) for ACAT ID/IAM programs. DCAPE may be the approval authority for AoA Study Guidance and AoA Study Plans; DCAPE is the approval authority for Independent Cost Estimates for ACAT ID and IAM programs. Enclosure 9 describes DCAPE roles and responsibilities in Analysis of Alternatives. DCAPE responsibilities are identified in DoD Directive 5105.84. requires use of the CARD and provides guidance on the content of the CARD in DOD Instruction 5000.73 (Reference (w)) to provide that foundation. For ACAT I and IA programs, the Program Manager will prepare, and an authority no lower than the DoD Component PEO will approve, the CARD. For joint programs, the CARD will cover the common program as agreed to by all participating DoD Components, as well as any DoD Component-unique requirements. The DCAPE and the organization preparing the DoD Component Cost Estimate Documents the cost analysis conducted by the Service Cost Agency (SCA) in cases where the SCA does not develop an Independent Cost Estimate (ICE). Three types of Component Cost Estimates are: • SCA non-advocate estimate • Independent SCA assessment of another government estimate such as the Program Office Estimate (POE) • Other SCA cost analysis, as determined by the SCA and reflected in DoD Component policy must receive a draft CARD 180 calendar days, and the final CARD 45 calendar days, prior to a planned OIPT or equivalent staff coordination body review or DoD Component review, unless DCAPE agrees to other due dates. The Program Manager and PEO will insure the draft and final CARDs are consistent with other final program documentation.

a. Recognizing that program details are refined over time, with fewer details available for MDAPs An acquisition program that is designated by the USD(AT&L) as an MDAP; or is estimated to require an eventual total expenditure for RDT&E including all planned increments, of more than $480 million in FY 2014 constant dollars or, for procurement, including all planned increments, of more than $2.79 billion in FY 2014 constant dollars. and MAIS programs approaching Milestone A than Milestone B, DCAPE will provide CARD development guidance tailored to the specific review being conducted and the type of system being developed. However, all CARDs, no matter how tailored, will provide a program description that includes a summary of the acquisition approach; expected constraints; system characteristics; quantities; operational factors; operational support strategy; manpower, personnel, and training requirements; preliminary schedules; test programs; technology maturation and risk reduction plans; and appropriate system analogs. Additional content may be required as requested by DCAPE.

b. When Milestone A occurs prior to release of the Technology Maturation and Risk Reduction Phase RFP, the DCAPE or DCAPE-approved DoD Component ICE will not be able to reflect information provided by the competing contractors in their proposals. Should the contractor proposed solutions entering the Technology Maturation and Risk Reduction Phase differ significantly from the design reflected in the Milestone A CARD, the Program Manager will report any differences that might alter the basis for the MDA’s Milestone A decision to DCAPE and the MDA. The MDA will determine whether an additional review is required prior to contract award.

c. At the Development RFP A document used in negotiated acquisitions to communicate Government requirements to prospective contractors and to solicit proposals. RFPs for competitive acquisitions describe the Government’s requirement; anticipated terms and conditions that will apply to the contract; information required to be in the offeror’s proposal; and factors and significant sub-factors that will be used to evaluate the proposal and their relative importance. Release Decision Point, the program described in the final CARD will reflect the Program Manager’s and PEO’s best estimate of the materiel solution that will be pursued following Milestone B. The final CARD will be updated to reflect all new program information prior to Milestone B.

4. DATA TO SUPPORT COST ESTIMATING

Standardized data collection procedures and formats are essential for credible cost estimates for current and future programs. DCAPE The CAPE Director (DCAPE) reports directly to the Secretary and Deputy Secretary of Defense, providing independent analytic advice on all aspects of the defense program, including alternative weapon systems and force structures, the development and evaluation of defense program alternatives, and the cost-effectiveness of defense systems. CAPE is responsible for the management of the Department’s programming processes and annual program review. The ultimate product of the program review is the Future Years Defense Program - the authoritative statement of what the Department plans, year by year, in terms of force structure (how many ships, brigades and divisions, aircraft squadrons and wings, etc., we will operate), procurement (how many ships, tanks, aircraft, missiles, etc., we will buy), manpower (how many people, military and civilian, we plan to employ in each of the services and defense agencies), other supporting programs (such as R&D and military construction), and what it will all cost. CAPE helps to shape the force in the long-term by providing analysis and advice on resource issues to the Joint Requirements Oversight Council as well as formulating study guidance for analyses of alternatives for major defense acquisition programs. In accordance with Table 2, DCAPE assesses Analysis of Alternatives (AoAs) for ACAT ID/IAM programs. DCAPE may be the approval authority for AoA Study Guidance and AoA Study Plans; DCAPE is the approval authority for Independent Cost Estimates for ACAT ID and IAM programs. Enclosure 9 describes DCAPE roles and responsibilities in Analysis of Alternatives. DCAPE responsibilities are identified in DoD Directive 5105.84. establishes procedural guidance for cost data collection and monitoring systems. Table 7 in Enclosure 1 of this instruction provides detailed information on Cost and Software Data Reporting (CSDR) The DoD system for collecting actual costs and software data and related business data. The resulting repository serves as the primary contract cost and software data (CSD) repository for most DoD resource analysis efforts, including cost database development, applied cost estimating, cost research, program reviews, Analysis of Alternatives (AoA), and life cycle cost estimates. requirements.

a. DoD has three primary sources for data to use for cost estimation: CSDR, the Integrated Program Management Report, and the Visibility and Management of Operating and Support Costs (VAMOSC) systems. The CSDR The DoD system for collecting actual costs and software data and related business data. The resulting repository serves as the primary contract cost and software data (CSD) repository for most DoD resource analysis efforts, including cost database development, applied cost estimating, cost research, program reviews, Analysis of Alternatives (AoA), and life cycle cost estimates. and the Integrated Program Management Report instruments serve as the primary sources of data when estimating acquisition costs for major contracts and subcontracts associated with MDAPs and MAIS programs. DCAPE defines procedural and standard data formatting requirements for the CSDR system in DoD Manual 5000.04-M-1 (Reference (at)). Formats and reporting requirements for Integrated Program Management Reports are determined and managed by USD(AT&L). VAMOSC data systems are managed by each Military Department and collect historical O&S costs for major fielded weapon systems. DCAPE conducts annual reviews of VAMOSC systems to address data accessibility, completeness, timeliness, accuracy, and compliance with CAPE guidance. The annual reviews also assess the adequacy of each military department’s funding and resources for its VAMOSC systems. DoD Instruction 5000.73 (Reference (w)) provides the procedural and data reporting requirements for VAMOSC.

b. The two components of the CSDR system are Contractor Cost Data Reporting and Software Resources Data Reporting. CSDR plans are developed pursuant to the requirements in DoD Manual 5000.04-M-1, and are required for each phase of program acquisition. Proposed CSDR plan(s) for ACAT I and IA programs must be approved by DCAPE prior to the issuance of a contract solicitation. The DCAPE has the authority to waive the information requirements of Table 7. Program managers will use the CSDR system to report data on contractor costs and resource usage incurred in performing DoD programs.

c. In addition to the historic O&S cost data stored in VAMOSC systems, each program must also retain and submit to CAPE, DoD Component and Service Cost Agency O&S cost estimates developed at any time during the life cycle of a major weapon system, together with copies of reports, briefings, and other supporting documentation that were used to prepare the cost estimates. This includes documentation used to prepare cost estimates for acquisition milestones or other program reviews, as well as O&S cost estimates incorporated into Selected Acquisition Reports.

5. DCAPE PROCEDURES

The DoD Component responsible for acquisition of a system will provide the cost, programmatic, and technical information required for estimating costs and appraising programmatic risks to DCAPE The CAPE Director (DCAPE) reports directly to the Secretary and Deputy Secretary of Defense, providing independent analytic advice on all aspects of the defense program, including alternative weapon systems and force structures, the development and evaluation of defense program alternatives, and the cost-effectiveness of defense systems. CAPE is responsible for the management of the Department’s programming processes and annual program review. The ultimate product of the program review is the Future Years Defense Program - the authoritative statement of what the Department plans, year by year, in terms of force structure (how many ships, brigades and divisions, aircraft squadrons and wings, etc., we will operate), procurement (how many ships, tanks, aircraft, missiles, etc., we will buy), manpower (how many people, military and civilian, we plan to employ in each of the services and defense agencies), other supporting programs (such as R&D and military construction), and what it will all cost. CAPE helps to shape the force in the long-term by providing analysis and advice on resource issues to the Joint Requirements Oversight Council as well as formulating study guidance for analyses of alternatives for major defense acquisition programs. In accordance with Table 2, DCAPE assesses Analysis of Alternatives (AoAs) for ACAT ID/IAM programs. DCAPE may be the approval authority for AoA Study Guidance and AoA Study Plans; DCAPE is the approval authority for Independent Cost Estimates for ACAT ID and IAM programs. Enclosure 9 describes DCAPE roles and responsibilities in Analysis of Alternatives. DCAPE responsibilities are identified in DoD Directive 5105.84.. The DoD Component will also facilitate DCAPE staff visits to the program office, product centers, test centers, and system contractor(s) as DCAPE deems necessary to support development of its cost estimate or assessment. The process through which the ICE is prepared will be consistent with the policies set forth in DoD Instruction 5000.73 (Reference (w)). The DCAPE’s current policies and procedures are as follows, but may be modified by DCAPE according to program needs:

a. DCAPE representatives participate in integrated product team meetings (i.e., cost WIPTs).

b. The DCAPE, DoD Components, and Program Manager:

(1) Share data and use the same CARD.

(2) Raise and resolve issues in a timely manner and at the lowest possible level.

(3) Address differences between the ICE, the DoD Component cost estimate, and the DoD Component cost position.

c. The Program Manager will identify issues projected to be brought to the OIPT to the DCAPE in a timely manner.

d. For joint programs:

(1) The lead DoD Component or executive agent will prepare the DoD Component Cost Estimate.

(2) All DoD Components involved must either jointly sign or individually submit a DoD Component Cost Position and Full Funding Certification Memorandum.

6. MULTI-YEAR PROCUREMENT—COST ANALYSIS REQUIREMENTS

a. General. In accordance with 10 U.S.C. 2306b (Reference (h)), a multi-year procurement contract is a contract for the purchase of property for more than 1, but not more than 5, program years. Multi-year contracts in an amount equal to or greater than $500 million may not be entered into unless the contract is specifically authorized by law in an Act other than an appropriations Act. In accordance with 10 U.S.C. 2306b, when submitting a request for authorization for a multi-year contract, the Secretary of Defense must include in the request a report containing the preliminary findings of the DoD Component head regarding the following:

(1) The use of such a contract will result in significant savings of the total anticipated costs of carrying out the program through annual contracts.

(2) The minimum need for the property to be purchased is expected to remain substantially unchanged during the contemplated contract period in terms of production rate, procurement rate, and total quantities.

(3) There is a reasonable expectation that throughout the contemplated contract period the head of the DoD Component will request funding for the contract at the level required to avoid contract cancellation.

(4) There is a stable design for the property to be acquired and the technical risks associated with such property are not excessive.

(5) The estimates of both the cost of the contract and the anticipated cost avoidance through the use of a multi-year contract are realistic.

(6) The use of such a contract will promote the national security of the United States.

b. CAPE The CAPE Director (DCAPE) reports directly to the Secretary and Deputy Secretary of Defense, providing independent analytic advice on all aspects of the defense program, including alternative weapon systems and force structures, the development and evaluation of defense program alternatives, and the cost-effectiveness of defense systems. CAPE is responsible for the management of the Department’s programming processes and annual program review. The ultimate product of the program review is the Future Years Defense Program - the authoritative statement of what the Department plans, year by year, in terms of force structure (how many ships, brigades and divisions, aircraft squadrons and wings, etc., we will operate), procurement (how many ships, tanks, aircraft, missiles, etc., we will buy), manpower (how many people, military and civilian, we plan to employ in each of the services and defense agencies), other supporting programs (such as R&D and military construction), and what it will all cost. CAPE helps to shape the force in the long-term by providing analysis and advice on resource issues to the Joint Requirements Oversight Council as well as formulating study guidance for analyses of alternatives for major defense acquisition programs. In accordance with Table 2, DCAPE assesses Analysis of Alternatives (AoAs) for ACAT ID/IAM programs. DCAPE may be the approval authority for AoA Study Guidance and AoA Study Plans; DCAPE is the approval authority for Independent Cost Estimates for ACAT ID and IAM programs. Enclosure 9 describes DCAPE roles and responsibilities in Analysis of Alternatives. DCAPE responsibilities are identified in DoD Directive 5105.84. Role and Requirements. Prior to the Secretary’s submission under paragraph 6.a, DCAPE is required to complete a cost analysis and determine such analysis supports the DoD Component head’s findings in paragraph 6a of this enclosure. In order for DCAPE to complete the cost analysis in a timely manner, the DoD Component head must submit a list of multi-year procurement contract candidates and supporting information to DCAPE no later than October 1 of the fiscal year prior to the fiscal year in which the request for legislative authority, with accompanying certification, will be made.

c. Additional Requirements. 10 U.S.C. 2306b (Reference (h)) sets forth several other requirements for multi-year contracts. Prior to requesting authority to enter into a multi-year contract, the program manager should consult with his or her agency’s counsel to confirm that the proposed multi-year contract complies with all relevant statutes and regulations.