Can you sub to the Gov.

I do not know of any statute that would prohibit such an arrangement, which does not mean that there isn't such a statute. The topic is not addressed in FAR. I seem to recall that it has been done, but I can't recall any details. I think the main issue would be the policy of the agency that is a candidate for the subcontract, whether they would be willing to do such a thing and how they would go about it. There may also be an issue about improper augmentation of appropriations.

Assuming the agency acting as "subcontractor" has statutory authority to sell services and retain those receipts, then the answer is probably yes. The better question is should the government (as buyer) enter into a contract where the government is a "subcontractor"? In answering this question, I would want to know who bears the risk of the "subcontractor's" nonperformance or delay: Is it the government or the prime? However, I recommend no one respond to this post, as it isn't the question pmh has asked (and only he would know what the actual risks--to include probability and consequence--were or whether the assuming those risks are offset by other aspects of the deal).

I suggest you look at CRADAs and how they work.

As you can imagine the biggest issue is the transfer, ownership and licensing of intellectual property.

We included this subcontract in our proposal to NIH. It's not a large dollar amount, so the financial risk is low.

I was looking into CRADA's yesterday, they appear to be designed more for a cost share relationship, which this isn't. I haven't done one before, but I need to do some more research into those, it may still be an option, thanks.

We included this subcontract in our proposal to NIH. It's not a large dollar amount, so the financial risk is low.

I was looking into CRADA's yesterday, they appear to be designed more for a cost share relationship, which this isn't. I haven't done one before, but I need to do some more research into those, it may still be an option, thanks.

How did the government respond to them being in your proposal? Is the LAB "approved" and a named sub in your contract with NIH?

The LAB will probably require the use of a Work for Others agreement when you go to contract with them. Your biggest challenge will probably determining price reasonableness, the LABS will be twice the price of private industry

Jacques response with regard to authority to sell services is point on. Recollection is not a good reference but in the era of the National Partnership for Reinventing Government (Clinton era) some agencies were given the authority to "sell" their services. I was personally involved in a situation where a Naval facility bid on a civilian agency solicitation for a construction project. Some of these authorities may still linger.

Might be a strange question, but I haven't been able to find any reference in the FAR. Can a prime contractor under a federal contract with one agency issue a subcontract to another federal agency (small Navy lab). It's for a small portion of R&D work. I haven't found anything that says we can't do it.

Some Navy labs such as the one at China Lake, CA are industrial funded activities authorized by 10 U.S.C. 2208. Those labs are authrorized to sell supplies and services to persons outside DoD, which includes contractors and non-contractors. 2208(h) specifically authorizes such a lab to be a subcontractor under DoD contracts.

There are a number of different statutes each with their own conditions, and many with their own GAO or court decision interpreting them. The rules and policies surrounding public-private partnerships are not for the faint of heart, and there are a fair number of traps for the unwary. I'm not saying don't do it, I'm saying get smart before you do. One starting point might be here: https://acc.dau.mil/CommunityBrowser.aspx?id=22413

One of the hurdles was would the receiving agency have any issues with accepting the mandatory flowdowns, including the other agencies flowdown requirements for a subcontract. The CO was fairly raw and had no idea if he could even accept them. In the end, we went the CRADA route and it seems to be working OK.