Us Code § 2781 - Costs not allowed under covered contracts
Full text of Us Code United States Code § 2781 — Costs not allowed under covered contracts, with citation guidance and answers to common questions.
§ 2781. Costs not allowed under covered contracts
(a) In general
The following costs are not allowable under a covered contract:
(1) Costs of entertainment, including amusement, diversion, and social activities and any costs directly associated with such costs (such as tickets to shows or sports events, meals, lodging, rentals, transportation, and gratuities).
(2) Costs incurred to influence (directly or indirectly) legislative action on any matter pending before Congress or a State legislature.
(3) Costs incurred in defense of any civil or criminal fraud proceeding or similar proceeding (including filing of any false certification) brought by the United States where the contractor is found liable or has pleaded nolo contendere to a charge of fraud or similar proceeding (including filing of false certification).
(4) Payments of fines and penalties resulting from violations of, or failure to comply with, Federal, State, local, or foreign laws and regulations, except when incurred as a result of compliance with specific terms and conditions of the contract or specific written instructions from the contracting officer authorizing in advance such payments in accordance with applicable regulations of the Secretary of Energy.
(5) Costs of membership in any social, dining, or country club or organization.
(6) Costs of alcoholic beverages.
(7) Contributions or donations, regardless of the recipient.
(8) Costs of advertising designed to promote the contractor or its products.
(9) Costs of promotional items and memorabilia, including models, gifts, and souvenirs.
(10) Costs for travel by commercial aircraft or by travel by other than common carrier that is not necessary for the performance of the contract and the cost of which exceeds the amount of the standard commercial fare.
(b) Regulations; costs of information provided to Congress or State legislatures and related costs
(1) Not later than 150 days after November 8, 1985, the Secretary of Energy shall prescribe regulations to implement this section. Such regulations may establish appropriate definitions, exclusions, limitations, and qualifications. Such regulations shall be published in accordance with section 1707 of title 41.
(2) In any regulations implementing subsection (a)(2), the Secretary may not treat as not allowable (by reason of such subsection) the following costs of a contractor:
(A) Costs of providing to Congress or a State legislature, in response to a request from Congress or a State legislature, information of a factual, technical, or scientific nature, or advice of experts, with respect to topics directly related to the performance of the contract.
(B) Costs for transportation, lodging, or meals incurred for the purpose of providing such information or advice.
(c) "Covered contract" defined
In this section, "covered contract" means a contract for an amount more than $100,000 entered into by the Secretary of Energy obligating funds appropriated for national security programs of the Department of Energy.
(d) Effective date
Subsection (a) shall apply with respect to costs incurred under a covered contract on or after 30 days after the regulations required by subsection (b) are issued.
(Pub. L. 107–314, div. D, title XLVIII, §4801, formerly Pub. L. 99–145, title XV, §1534, Nov. 8, 1985, 99 Stat. 774; Pub. L. 100–180, div. C, title I, §3131(a), Dec. 4, 1987, 101 Stat. 1238; renumbered Pub. L. 107–314, div. D, title XLVIII, §4801, and amended Pub. L. 108–136, div. C, title XXXI, §3141(k)(2), Nov. 24, 2003, 117 Stat. 1783; Pub. L. 113–66, div. C, title XXXI, §3146(i)(1), Dec. 26, 2013, 127 Stat. 1081.)
Editorial Notes
Codification
Section was formerly classified to section 7256a of Title 42, The Public Health and Welfare, prior to renumbering by Pub. L. 108–136.
Amendments
2013—Subsec. (b)(1). Pub. L. 113–66 substituted "section 1707 of title 41" for "section 22 of the Office of Federal Procurement Policy Act (41 U.S.C. 418b)".
2003—Pub. L. 108–136, §3141(k)(2)(D)(i), made technical amendment to section catchline.
Subsec. (b)(1). Pub. L. 108–136, §3141(k)(2)(D)(ii), substituted "November 8, 1985," for "the date of the enactment of this Act," in the original, which for purposes of codification had been changed to "November 8, 1985," thus requiring no change in text.
1987—Subsec. (b). Pub. L. 100–180 designated existing provisions as par. (1) and added par. (2).
Statutory Notes and Related Subsidiaries
Regulations
Pub. L. 100–180, div. C, title I, §3131(b), Dec. 4, 1987, 101 Stat. 1239, provided that regulations to implement subsec. (b)(2) of this section were to be prescribed not later than 90 days after Dec. 4, 1987.
About This Section
50 U.S.C. § 2781 is part of Title 50 of the United States Code. The United States Code is the official codification of federal statutes maintained by the Office of the Law Revision Counsel of the U.S. House of Representatives. Congress amends the Code through new public laws, which are eventually incorporated into the relevant title.
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