Air Travel and Airfare Costs

Allowable or Unallowable: Unallowable, Allowable

Source:

Airfare Costs

(b) Airfare costs in excess of the lowest priced airfare available to the contractor during normal business hours are unallowable except when such accommodations require circuitous routing, require travel during unreasonable hours, excessively prolong travel, result in increased cost that would offset transportation savings, are not reasonably adequate for the physical or medical needs of the traveler, or are not reasonably available to meet mission requirements.

Airfare Allowable Exceptions

In order for airfare costs in excess of the lowest priced airfare available to be allowable, the applicable condition(s) and reasons for the higher airfare must be documented, and justified.

Contractors should have a formal process for justifying and documenting the exception. Many contractors have a "Allowable Airfare Determination" form. Common exemptions/excepts are:

• SAFETY - The selection of carrier, flight time, or routing was impacted by safety concerns.

• FLY AMERICA ACT - The contract under which the travel was undertaken required an American Flag Carrier.

• MISSION REQUIREMENTS - Flight selection was based upon mission requirements.

• CIRCUITIOUS ROUTING OR EXCESSIVE PROLONGED TRAVEL - Travel selection was based upon consideration for routing and excessive prolonged travel. Travel in excess of 11 hours per JTR allows for an 8 hour rest stop, and the consideration of these costs, and air fare costs was considered in best value to the government.

• UNREASONABLE TRAVEL TIMES - Lowest airfare was not selected, as the lowest cost airfare had unreasonable travel times.

• PHYSICAL OR MEDICAL LIMITATIONS - Lowest airfare was not chosen due to physical or medical conditions.

• REFUNDABLE TICKETS - Lowest airfare was not chosen due to high uncertainty of travel days, and cancellation of trip.

DCAA Determination of Travel Rule - Lowest Available Airfare

The current basis of DCAA for determining lowest price airfare is the Department of Transportation averages based on member inputs. This is problematic, in that an average may or may not reflect the actual lowest airfare to which DCAA is testing. The average in fact could produce a lower airfare that is actually available to contractors.

THUS IT IS IMPERATIVE THAT CONTRACTORS HAVE REQUIREMENTS IN PLACE SO THAT EMPLOYEE AIRFARE TRAVEL IS FULLY DOCUMENTED.

Premium Class Travel

Generally unallowable, unless an excessively long trip (ie over 10 or 12 hours, New DoD policy March 19, 2004 requires 14 hours and even then discourages premium travel) or other reasons such as availability of lower class flights. PLEASE READ THE MEMO BELOW.

File:Premium Class Travel - DOD March 19 2004.pdf

Contractor Owned, Leased, or Chartered Aircraft

(c)

(1) “Cost of travel by contractor-owned, -leased, or -chartered aircraft,” includes the cost of lease, charter, operation (including personnel), maintenance, depreciation, insurance, and other related costs.

(2) The costs of travel by contractor-owned, -leased, or -chartered aircraft are limited to the allowable airfare described in paragraph (b) of this subsection (lowest customary airfare above)for the flight destination unless travel by such aircraft is specifically required by contract specification, term, or condition, or a higher amount is approved by the contracting officer. A higher amount may be agreed to when one or more of the circumstances for justifying higher than allowable airfare listed in paragraph (b) of this subsection are applicable, or when an advance agreement under paragraph (c)(3) of this subsection has been executed. In all cases, travel by contractor-owned, -leased, or -chartered aircraft must be fully documented and justified. For each contractor-owned, -leased, or -chartered aircraft used for any business purpose which is charged or allocated, directly or indirectly, to a Government contract, the contractor must maintain and make available manifest/logs for all flights on such company aircraft. As a minimum, the manifest/log shall indicate—

• (i) Date, time, and points of departure;

• (ii) Destination, date, and time of arrival;

• (iii) Name of each passenger and relationship to the contractor;

• (iv) Authorization for trip; and

• (v) Purpose of trip.

(3) Where an advance agreement is proposed (see 31.109), consideration may be given to the following:

• (i) Whether scheduled commercial airlines or other suitable, less costly, travel facilities are available at reasonable times, with reasonable frequency, and serve the required destinations conveniently.

• (ii) Whether increased flexibility in scheduling results in time savings and more effective use of personnel that would outweigh additional travel costs.

Related Pages

FOR TRAVEL RELATED TO A SPECIFIC CONTRACT, THE FLY AMERICA ACT MAY APPLY. PLEASE SEE - Fly America Act

Defense Travel Management Office

Audit Guidance on Revision to FAR 31.205-46(b) and (c) – Limiting Airfare to the Lowest Airfare Available to the Contractor. Please see File:DCAA MRD Airfare.pdf