FFP delivery order with long lead time

The short answer is you are fine using FY 24 funds since it appears your agency need is a FY24 requirement.  But the detailed and precise answer is found by researching this from here at Wifcon Bona Fide Need rule

As formerfed pointed out, FY24 funds can be obligated as long as this is an FY 24 requirement (i.e. the agency wants the widgets now, but it takes a year to get them for some reason). If the initial 12 month delay and the phased deliveries after that are at the discretion of the agency, for example if the agency knows they will need the widgets beginning next year and then will use them at a rate of 250/month, that is probably not an FY 24 requirement. In addition to the Wifcon link the Contract or Fiscal Law Attorney Deskbooks here can be useful (although some is DOD-specific, statutory exceptions to bona fide need, for example).

Birdsong said:

Am I correct, that the funding will need to be good until the last delivery is made?

What do you mean by "good" in this statement?  If you are using appropriated funds, they must be obligated within their period of availability for obligation.  Once obligated, they remain available for expenditure until five years after the period of availability for obligation expires.  

Birdsong said:

My concern is the order crosses 2 fiscal years.

Why are you concerned if the order is for supplies?

On 4/25/2024 at 11:16 AM, Retreadfed said:

Why are you concerned if the order is for supplies?

An order being for supplies, by itself, is not an exception to the bona fide needs rule. It still matters when the need is, and Birdsong's original description doesn't say whether the 12-month initial delay and then monthly deliveries is an issue with order/production lead-time (which would likely be an exception) or if the Government maybe just doesn't need the widgets until 12 months from now and then will only need 250 per month thereafter (which would seem to make it a need for future fiscal years).

RJ_Walther said:

if the Government maybe just doesn't need the widgets until 12 months from now and then will only need 250 per month thereafter (which would seem to make it a need for future fiscal years).

Maybe maybe not.  The issue is when does the need arise not when it will be met.  In any event, we don't know what Birdsong's concern is with the order crossing 2 fiscal years.  It might be a valid concern or it might not.  We just don't know.

Retreadfed said:

Maybe maybe not.  The issue is when does the need arise not when it will be met.

So true.  I’ve seen many instance where staggered deliveries instead of all at once occur due to things like contractor production capacity or the governments inability to accommodate large quantities.

Rule 17.  Locked