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Options for Additional Work
By Anon1 on Thursday, April 18, 2002 - 12:00 pm:

Can anyone shed some light on why FAR Part 17.208 does not have an option clause for different supplies. Instead the clause used says, "(e) Insert a clause substantially the same as the clause at 52.217-7, Option for Increased Quantity -- Separately Priced Line Item, in solicitations and contracts, other than those for services, when the inclusion of an option is appropriate (see 17.200 and 17.202) and the option quantity is identified as a separately priced line item having the same nomenclature as a corresponding basic contract line item."

Hence, my confusion. I have seen many contracts include separately priced line items that are for totally different items and are called "option" clins because the customer doesn't have the funds at contract award and/or they simply don't know if they will be needing the items for sure. They may have a very strong notion that the items will be needed, but not 100 percent sure. So we add them to the basic contract to be exercised later if needed. Is this the only way to do this?


By Kennedy How on Thursday, April 18, 2002 - 12:26 pm:

I don't know the specific answer, but if the items listed in the option lines were part of the original scope of work, I suppose you could do that. It's not really new work, it's been priced. The only uncertainty is when and how many.

I think we've done this on some of our more complex systems contracts, where we might need to incorporate retrofit changes both onto the production line, and vehicles in the field. Depending on cut-on, that depends on how many you'd need. So, an option line may be the way to go, especially for out years.

I've done option lines for ECP retrofit, Warranty, fielding services/hardware.

Kennedy


By Anon1 on Thursday, April 18, 2002 - 12:49 pm:

Thanks - Yes the separate clins were priced in the original competition, so it is part of the basic contract. I don't see any CICA violations, it's just weird that the FAR or DFARS doesn't address items that are a part of the original contract but not called out until later, if at all. To assume a contract can only contain CLINs that are activated on the award date seems short sighted. To address options for extending service, or period of performance, or additional quantities, but not a separate item doesn't make sense to me. It seems like such an obvious thing to do. Am I missing something really simple??


By Anonymous on Thursday, April 18, 2002 - 03:55 pm:

I have always held that an "option" is a process to obtain more of the same. By this I mean that I have a CLIN for Model 123 and I have an option,another clin for Model 123. If I do not have the first CLIN which is the FFP of my schedule, I cannot have the second clin. I think you are confusing options with requirement6s.


By Anonymous on Thursday, April 18, 2002 - 03:58 pm:

I have always held that an "option" is a process to obtain more of the same. By this I mean that I have a CLIN for Model 123 and I have an option,another clin for Model 123. If I do not have the first CLIN which is the FFP of my schedule, I cannot have the second clin. I think you are using options when they should be requirements type clins


By Vern Edwards on Thursday, April 18, 2002 - 04:18 pm:

An option can be for anything. You can use an option to extend the term of performance, to buy additional quantities, or to buy something that you didn't include in the initial purchase.

You can have a basic CLIN for an item of supply and an option CLIN for a different item. You can have a basic CLIN for supplies and an option CLIN for services. You can have a basic CLIN for one type of service and an option CLIN for a different type. For example, I can envision an R&D contract that requires a contractor to pursue one line of inquiry with an option to pursue a different line of inquiry (to be exercised depending upon the outcome of the first inquiry). Why not? I don't see anything in FAR which precludes the use of such options. Nor am I aware of any GAO decision which precludes such use. However, this is not to say that I think it's a good idea.

Who knows why FAR does not include a standard clause for options other than additional quantities? It may be that the FAR Council didn't think about it. Or it may be that they didn't think they could devise a standard clause for such different types of options.


By Anon1 on Thursday, April 18, 2002 - 05:52 pm:

Thanks Anon and Vern. I agree I can do it, I just wasn't sure why Federal regulations didn't address it.

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