FAR 30.201-5—Waiver.
Plain-English Summary
FAR 30.201-5 explains when and how the Cost Accounting Standards (CAS) may be waived for a particular contract or subcontract, and who has authority to approve that waiver. It covers two waiver paths: a limited agency-level waiver for contracts or subcontracts under $15 million when the performing segment is primarily commercial and has no CAS-covered contracts, and an exceptional-circumstances waiver when the agency determines that waiving CAS is necessary to meet agency needs. The section also addresses the required written determinations, the information that should be included in a waiver request, when a request must be elevated to the CAS Board under 48 CFR 9903.201-5(e), and the agency’s obligation to report granted waivers to the CAS Board after the fiscal year ends. In practice, this section matters because CAS waivers are unusual and tightly controlled; they can affect competition, pricing, negotiation strategy, and compliance risk. Contractors need to know whether CAS will apply before deciding to bid or accept an award, while contracting officials must build a defensible record showing the waiver fits one of the permitted bases and that the proper approval level is used.
Key Rules
Agency head approval only
Only the head of the agency may waive CAS for a particular contract or subcontract under this section. That authority cannot be delegated below the senior contract policymaking level.
Under-$15 million commercial segment waiver
A waiver may be granted when the contract or subcontract is valued at less than $15 million and the agency head determines in writing that the performing segment is primarily engaged in commercial products or services and has no CAS-covered contracts or subcontracts.
Exceptional circumstances waiver
A waiver may also be granted when the agency head determines that exceptional circumstances require it to meet agency needs. The benefits of the waiver must outweigh the associated risk, and the determination must be in writing with specific supporting circumstances.
Required waiver request content
When a waiver condition exists, the request should include the award amount, contract type, whether the performing segment has CAS-covered work, a description of the items being procured, whether the contractor would refuse the award if CAS applies, pricing data information, the benefits and risks of waiving CAS, the needed date, and any other useful information.
CAS Board submission when no agency waiver fits
If neither agency-level waiver condition applies, the waiver request must be prepared under 48 CFR 9903.201-5(e) and submitted to the CAS Board for consideration.
Annual reporting to the CAS Board
Each agency must report all waivers granted under this section to the CAS Board on a fiscal-year basis no later than 90 days after the end of the Government’s fiscal year.
Responsibilities
Head of the Agency
Decide whether to waive CAS for a specific contract or subcontract, ensure the waiver fits one of the permitted bases, make the required written determination, and avoid delegating this authority below the senior contract policymaking level.
Contracting Officer / Acquisition Staff
Prepare a complete waiver request package, gather the required facts and supporting documentation, assess whether the waiver criteria are met, and route the request to the proper approval authority or to the CAS Board when required.
Contractor / Subcontractor
Provide information needed to support the waiver request, including segment status, CAS coverage history, pricing data issues, and whether the firm would decline the award if CAS applies.
Agency
Track granted waivers and submit the required annual report to the CAS Board within 90 days after the close of the fiscal year.
CAS Board
Receive waiver requests that do not qualify for agency-level approval under paragraph (b) and receive annual waiver reports from agencies.
Practical Implications
CAS waivers are narrow exceptions, not routine procurement tools, so the record must clearly show why the waiver is legally available and why it is needed.
The $15 million threshold and the “primarily commercial” and “no CAS-covered contracts” findings are all required for the limited agency waiver; missing any one of them can invalidate the waiver path.
Exceptional-circumstances waivers require a real balancing of benefits versus risk, not just convenience or schedule pressure, and the written justification should be specific enough to withstand review.
Contractors should raise waiver issues early because CAS applicability can affect whether they will bid, how they price, and whether certified cost or pricing data will be needed.
Agencies should maintain a waiver log and reporting process so the fiscal-year CAS Board report is complete and timely, and so waiver decisions can be defended during audits or policy reviews.
Official Regulatory Text
(a) The head of the agency- (1) May waive the applicability of CAS for a particular contract or subcontract under the conditions listed in paragraph (b) of this subsection; and (2) Must not delegate this waiver authority to any official in the agency below the senior contract policymaking level. (b) The head of the agency may grant a waiver when one of the following conditions exists: (1) The contract or subcontract value is less than 15 million, and the head of the agency determines, in writing, that the segment of the contractor or subcontractor that will perform the contract or subcontract- (i) Is primarily engaged in the sale of commercial products or commercial services; and (ii) Has no contracts or subcontracts that are subject to CAS. (2) The head of the agency determines that exceptional circumstances exist whereby a waiver of CAS is necessary to meet the needs of the agency. Exceptional circumstances exist only when the benefits to be derived from waiving the CAS outweigh the risk associated with the waiver. The determination that exceptional circumstances exist must- (i) Be set forth in writing; and (ii) Include a statement of the specific circumstances that justify granting the waiver. (c) When one of the conditions in paragraph (b) of this subsection exists, the request for waiver should include the following: (1) The amount of the proposed award. (2) A description of the contract or subcontract type ( e.g., firm-fixed-price, cost-reimbursement). (3) Whether the segment(s) that will perform the contract or subcontract has CAS-covered contracts or subcontracts. (4) A description of the item(s) being procured. (5) When the contractor or subcontractor will not accept the contract or subcontract if CAS applies, a statement to that effect. (6) Whether certified cost or pricing data will be obtained, and if so, a discussion of how the data will be used in negotiating the contract or subcontract price. (7) The benefits to the Government of waiving CAS. (8) The potential risk to the Government of waiving CAS. (9) The date by which the waiver is needed. (10) Any other information that may be useful in evaluating the request. (d) When neither of the conditions in paragraph (b) of this subsection exists, the waiver request must be prepared in accordance with 48 CFR 9903.201-5(e) and submitted to the CAS Board. (e) Each agency must report any waivers granted under paragraph (a) of this subsection to the CAS Board, on a fiscal year basis, not later than 90 days after the close of the Government’s fiscal year.