Subject: Two-Year Extension of Warranty Claims Recovery Pilot Program

OFFICE OF THE UNDER SECRETARY OF DEFENSE

3000 DEFENSE PENTAGON

WASHINGTON, D.C. 20301-3000

APRIL 11 2005

[ILLUSTRATION OMITTED]

MEMORANDUM FOR DIRECTORS, DEFENSE AGENCIES

DEPUTY ASSISTANT SECRETARY OF THE ARMY (POLICY AND PROCUREMENT), ASA(ALT)

DEPUTY ASSISTANT SECRETARY OF THE NAVY (ACQUISITION MANAGEMENT), ASN(RDA)

DEPUTY ASSISTANT SECRETARY OF THE AIR FORCE (CONTRACTING), SAF/AQC

DEPUTY DIRECTOR FOR LOGISTICS OPERATIONS (DLA)

DIRECTOR, ADMINISTRATION AND MANAGEMENT

DIRECTOR, ARMY CONTRACTING AGENCY

SUBJECT: Two-Year Extension of Warranty Claims Recovery Pilot Program

Section 391 of the National Defense Authorization Act for Fiscal Year 1998 (Public Law 105-85), as amended, authorizes the Secretary of Defense to carry out a pilot program to use commercial sources of services to improve the collection of the Department of Defense claims under aircraft engine warranties and to enter into contracts under the pilot program for collection-related services. Section 391 also provides guidance with regard to the payment of contractor fees and the retention of recovered funds. Finally, section 391 includes a reporting requirement, which (1) identifies the extent to which commercial firms have been used for collection-related services under this pilot program; (2) describes any problems that have limited the ability of the Secretary of Defense to procure such services under the pilot program; and (3) any recommendations the Secretary may have regarding whether the pilot program should be made permanent or extended beyond the specified date in section 391.

The Fiscal Year 2005 Authorization Act extended the authority for the pilot program to September 30, 2006. The report on the program is due to Congress in February 2006. (A conformed copy of the law is enclosed.)

Request that you identify any contracts entered into under this pilot program for collection-related services as identified in section 391(b), and provide me with the information required for the report, along with points of contact for follow-up discussions on these pilot programs. This data should be provided no later than June 30, 2005. If you have not utilized the authority provided under section 391, please provide a negative response and a brief summary as to why. My point of contact for this matter is Susan Hildner, (703) 695-4258, susan.hildner@osd.mil.

Deidre A. Lee

Director, Defense Procurement and Acquisition Policy

Enclosure:

As stated

Editor's note: View the attachment to this memorandum at <http://www.acq.osd.mil/dpap/policy/policyvault/2005-0453-DPAP2.pdf>.

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