(a) The structured approach was designed for determining profit or fee objectives for
commercial organizations. However, the structured approach must be used as a basis for
arriving at profit/fee objectives for nonprofit organizations (
FAR Subpart 31.7), excluding
educational institutions (
FAR Subpart 31.3), in accordance with paragraph (b) of this section. It is NASA policy not to pay profit or fee on contracts with educational institutions.
(b) For contracts with nonprofit organizations under which profit or fee is involved, an adjustment of up to 3 percent of the costs in Block 13 of NASA Form 634 must be
subtracted from the total profit/fee objective. In developing this adjustment, it is necessary to consider the following factors:
(1) Tax position benefits;
(2) Granting of financing through letters of credit;
(3) Facility requirements of the nonprofit organization; and
(4) Other pertinent factors that may work to either the advantage or disadvantage of the contractor in its position as a nonprofit organization.
