General question
Started by subbby2005 · Oct 11, 2013 · 5 replies
- sOriginal post
subbby2005
Oct 11, 2013 · 12y ago
If the Government exercises an Option unilaterally at the conclusion of a defined base period, does that action constitute a new sole-source contract?
If so, are the sole-source requirements applicable such as a D&F where, for example, lack of competition is used as a basis for the option?
Is lack of competition necessary to exercise the option?
Also is there a duty on the Government to justify that the Options is in the best interests of the Government?
If so, what steps are necessary to document the record?
How would you describe the Option if you determine it is not a sole-source action?
I hope to get some feedback soon.
Cheers.
- i
illzoni
Oct 11, 2013 · 12y ago
The exercise of an option is not a new sole-source contract. It is a continuation of the current contract, within the terms originally solicited and awarded (or justified).
Sole-source requirements are not applicable.
Deciding to exercise an option is not contingent upon a lack of competition. Appropriate competition should've taken place prior to contract award. The government may opt to not exericse the option and resolicit/compete (see next answer).
The government must document exercise of the option is in the best interests of the government. This usually involves a market survey (complexity varies) to determine if the option terms (mostly pricing) is still reasonable. If research indicates the government would be best served with a new soclicitation, document so and press forward.
See first answer for description of option.
- N
Navy_Contracting_4
Oct 11, 2013 · 12y ago
Have you read FAR Subpart 17.2?
You may also want to review the discussion at /threads/3817-gao-s-latest-mcs-decision.
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Guest Vern Edwards
Oct 12, 2013 · 12y ago
The answer to the question is no, the exercise of an option does not result in a new sole source contract. See FAR 6.001( c ), which states that the requirements of the Competition in Contracting Act and FAR Part 6, including requirements for sole source actions, do not apply to the exercise of options when done in accordance with FAR 17.207(f). FAR 17.207(f) refers to FAR Part 6, but does not, in and of itself, answer the question at hand.
Answers that make assertions about the rules, but that do not cite the specific rules in question, are not reliable.
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Fear & Loathing in Contracting
Oct 22, 2013 · 12y ago
The more detailed responses above are great, but I would also suggest taking a step back and think about the core fundamentals. A good place to start is with the definitions in FAR Subpart 2.1.
“Option” means a unilateral right in a contract by which, for a specified time, the Government may elect to purchase additional supplies or services called for by the contract, or may elect to extend the term of the contract.
Key part for you: "...right in a contract..." Thus: an option by definition is a subset of an existing contract.
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illzoni
Oct 23, 2013 · 12y ago
Answers that make assertions about the rules, but that do not cite the specific rules in question, are not reliable.
Vern,
Is this a generic response or specific?
Jon