scope:

This instruction shall apply to all Navy contracts for shipbuilding (including small boats) or ship conversion, alteration, or repair, sometimes referred to herein collectively as shipbuilding contracts, entered into on or after the approval date of this SECNAVINST, except cost reimbursement type contracts and Master Ship Repair Contracts (DOD Federal Acquisition Regulation (FAR) Supplement Subpart 217.71). For all other contracts (except contracts for construction, as defined in FAR Subpart 36.102), including any separate contracts for engines, machinery, equipment, or other components for ships, the only type progress payment provisions will be those based on costs in accordance with reference (a).

Purpose.

To authorize progress payments based on a percentage of completion for fixed price and fixed price incentive contracts for shipbuilding or ship conversion, alteration, or repair. This instruction implements the provisions of 10 U.S.C. 2307 and is a revision of SECNAV Instruction 7810.12B. This Instruction has been administratively revised and should be reviewed in its entirety.