FAR 42.602—Assignment and location.
Plain-English Summary
FAR 42.602 explains when a Corporate Administrative Contracting Officer (CACO) may be assigned, where that CACO should be located, how agencies decide whether to start or stop a CACO assignment, who is responsible for making the assignment when a contractor has multiple locations, and where to find the official directory listing CACOs and their assigned contractors. In practice, this section is about centralizing contract administration at the corporate level when that improves coordination, oversight, and efficiency across multiple contracts and locations. It sets threshold conditions for using a CACO, including the requirement for at least two locations with resident ACOs unless higher-level approval is obtained, and it treats certain nonresident ACOs as resident for this purpose if they devote at least 75 percent of their effort to one contractor. It also tells agencies to consider practical factors such as corporate records, corporate office, major plant, cognizant government auditor, and overall cost effectiveness when choosing the CACO’s location. Finally, it allocates responsibility among agencies and points users to the contract administration services directory for the official listing of CACO assignments.
Key Rules
CACO assignment threshold
A CACO may be assigned only if the contractor has at least two locations with resident ACOs, or if the need for a CACO is approved by the agency head or designee. For this purpose, a nonresident ACO counts as resident if at least 75 percent of that ACO’s effort is devoted to a single contractor.
One CACO or resident ACO
The agency may designate one of the resident ACOs to perform CACO functions, or it may assign a full-time CACO. The rule gives agencies flexibility in staffing the function based on the contractor’s size and administrative needs.
Location factors for CACO
When deciding where the CACO should be located, the responsible agency must consider the location of corporate records, the corporate office, the major plant, the cognizant government auditor, and overall cost effectiveness. The location decision is meant to support practical administration, not just organizational convenience.
Start or stop based on need
A decision to initiate or discontinue a CACO assignment should be based on the benefits of corporate-level coordination and liaison, the volume of Government sales, the degree of control the corporate office exercises over lower-tier operating elements, and the impact of corporate policies and procedures on those elements. These factors help determine whether centralized administration is worthwhile.
Single-agency responsibility
If all locations of a corporate entity are under the contract administration cognizance of one agency, that agency is responsible for assigning the CACO. This avoids duplication and ensures one agency manages the corporate-level administration relationship.
Multi-agency coordination
If the contractor’s locations fall under more than one agency, the agencies must agree on the responsible agency, normally based on the agency with the largest dollar balance, including options, of affected contracts. Agencies may also consider geographic location when reaching agreement.
Directory listing
The directory of contract administration services components referenced in FAR 42.203 includes a listing of CACOs and the contractors for which they are assigned responsibility. This provides an official reference for identifying the assigned CACO.
Responsibilities
Agency head or designee
Approve a CACO assignment when the contractor does not otherwise meet the normal threshold of having at least two locations with resident ACOs.
Responsible agency
Determine whether to assign, locate, initiate, or discontinue a CACO; consider the required location factors; and ensure the assignment is made by the proper agency when contractor locations are under its cognizance.
Resident ACO
May be designated to perform CACO functions when the agency chooses not to assign a separate full-time CACO.
Contract administration agencies
When more than one agency has cognizance over the contractor’s locations, coordinate and agree on which agency will be responsible for the CACO assignment, usually based on the largest dollar balance of affected contracts and, if useful, geographic location.
Contract administration services components
Maintain the directory referenced in FAR 42.203, including the listing of CACOs and the contractors assigned to them.
Practical Implications
This section matters when a contractor has multiple sites and the Government needs a single point of contact for corporate-level administration. It helps avoid fragmented oversight and inconsistent communication across contracts.
A common pitfall is assuming a CACO can be assigned just because a contractor is large or complex; the rule requires the specific threshold conditions or higher-level approval.
Another issue is miscounting whether an ACO is “resident.” A nonresident ACO can count only if at least 75 percent of that person’s effort is devoted to one contractor, so agencies should document that workload carefully.
Agencies should not choose the CACO location casually. Records location, corporate office, major plant, auditor location, and cost effectiveness all matter, and the best location may not be the headquarters.
Contractors should expect that corporate policies, sales volume, and the degree of corporate control can trigger or end a CACO relationship, so changes in corporate structure or Government business volume may affect administration arrangements.
Official Regulatory Text
(a) A CACO may be assigned only when (1) the contractor has at least two locations with resident ACO’s or (2) the need for a CACO is approved by the agency head or designee (for this purpose, a nonresident ACO will be considered as resident if at least 75 percent of the ACO’s effort is devoted to a single contractor). One of the resident ACO’s may be designated to perform the CACO functions, or a full-time CACO may be assigned. In determining the location of the CACO, the responsible agency shall take into account such factors as the location(s) of the corporate records, corporate office, major plant, cognizant government auditor, and overall cost effectiveness. (b) A decision to initiate or discontinue a CACO assignment should be based on such factors as the- (1) Benefits of coordination and liaison at the corporate level; (2) Volume of Government sales; (3) Degree of control exercised by the contractor’s corporate office over Government-oriented lower-tier operating elements; and (4) Impact of corporate policies and procedures on those elements. (c) Responsibility for assigning a CACO shall be determined as follows: (1) When all locations of a corporate entity are under the contract administration cognizance of a single agency, that agency is responsible. (2) When the locations are under the contract administration cognizance of more than one agency, the agencies concerned shall agree on the responsible agency (normally on the basis of the agency with the largest dollar balance, including options, of affected contracts). In such cases, agencies may also consider geographic location. (d) The directory of contract administration services components referenced in 42.203 includes a listing of CACO’s and the contractors for which they are assigned responsibility.