Value Program

Federal Requirements

Requirements in General

In brief, Reclamation is required to:

  1. Identify all projects, programs, systems, and products with the potential to yield significant savings or best value from the application of Value Studies

  2. Perform indicated Value Studies

  3. Maintain files on what has been studied; what has not been studied and why; what value study proposals have been made, implemented, or not implemented, and why.

  4. Encourage, evaluate, and process Value Engineering Change Proposals (VECPs) from contractors in accordance with FAR Parts 31, 48, and 52.
Reclamation is audited every 3 years in compliance with the Office of Management and Budget's (OMB) Circular No. A-131 and the U.S. Department of the Interior's (DOI) Departmental Manual, Part 369, Chapter 1 (369 DM 1), which states, "Meeting Value Analysis requirements [goals] shall be a performance measure of bureau/office directors and appropriate managers responsible for the mandatory VA program."

Applying Requirements to Specific Programs

Follow the table below for all programs, projects, or activities (PPAs) where there are Federal funds or the U.S. Government is fiscally responsible for executing or operating the program in case the funding entity defaults.  (If this is not the case, then use
VE incentive clauses.)

Funding Type Project Type Cost Return on investment for a value study Requirement
Non-Reclamation       Use other agency's Value Program procedures. Determine client desire for use of value study and offer / provide study services.
Grant       Encourage use of Value studies (DM 369.1.1.2).
Reclamation Supply or service contract     May be exempt from mandatory Value study (DM 369.1.1.7B; CFR/FAR 48.201(a)). Should be examined for possible benefits of a Value study (DM 369.1.1.8B). If potential benefits warrent, arrange for a Value study.
Reclamation Construction, repair, rehabilitation, or renovation (CRRR) CRRR is over $100,000 but below $1,000,000   Value study not required. VECP Clause required (DM 369.1.1.8.B; CFR/FAR 48).
Reclamation Construction, repair, rehabilitation, or renovation (CRRR) CRRR is over $1 million   Value Engineering study is required (OMB Circular No. A-131; DM 369.1.1.7.A
and VECP Clause required
Reclamation Construction, repair, rehabilitation, or renovation (CRRR) CRRR is over $10 million   Value Engineering and Value Planning studies are required (OBM Circular No. A-131; DM 369.1.1.7.A)
VECP Clause required
Reclamation Other (not construction or supply)   >5.1 Value study should be performed (DM 369.1.1.8B).
Reclamation Other (not construction or supply)   >1.1 or a value study could provide benefits that are not measured by an ROI. Seriously consider performing a value study (DM 369.1.1.8B).

Specific Requirements

The National Defense Authorization Act for Fiscal Year 1996 included 41 USC 401 subpart 36 (Public Law [PL] 104-106), which states, "Each executive agency shall establish and maintain cost-effective value engineering procedures and processes."

This general requirement is addressed more specifically in the OMB Circular No. A-131.  This circular has been in existence for many years, but was not given the force of law until PL 104-106 was enacted.  The circular defines several Value Method terms, sets broad policy, sets minimum agency responsibilities, and requires reporting of results of using Value Study processes.

Value Studies are also mandated in the Code of Federal Regulations's Title 48, "Federal Acquisition Regulations System." Specifically, Part 48, "Value Engineering;" Part 52, "Solicitation Provisions and Contract Clauses;" and Part 31, "Contract Cost Principles and Procedures."

DOI  has supplemented PL 104-106, OMB Circular No. A-131, and CFR Title 48 with 369 DM 1.  This Departmental Manual further defines roles and responsibilities for Reclamation (and all other DOI Bureaus, agencies, and services).

Reclamation has further defined roles and responsibilities in the Reclamation Manual (RM) with "Reclamation Value Program" Policy CMP P05 and Directives and Standards CMP 06-01.


Last Updated: 6/26/19