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Good Morning WIFCON Community, Scenario: I have a question regarding contractual authority on a FFP commercial services contract. This contract is for physician services paid at an hourly rate. The contract states that the annual quantity is 2,080 hours. We are at the end of the base period of performance, and the government only used 1,980 hours. I now need to modify the contract and de-obligate the excess funds. What authority do I have to modify the contract and de-obligate the excess funds? My Thoughts: I have only two options for modifying the contract to de-obligate the excess funds. The first option is a bi-lateral modification (supplemental agreement) under the authority of 52.212-4©. The second option is a partial termination for convenience under the authority of 52.212-4(l). Other than utilizing one of these two options, I don't see any other authority I have to modify this contract and de-obligate the excess funds. I have always treated these modifications as bi-lateral, as I don't think that the de-obligation of excess funds is an administrative action. In my opinion, changing the amount of hours and associated value of the contract explicitly changes the terms of the contract. Therefore, the only unilateral modification authority I would have to take such an action would be termination for convenience. Other Opinions: I have some folks suggesting that the de-obligation of funds is only an "administrative modification" or a "funding only modification," and that it can be done unilaterally - especially since that particular performance period is now over. Are there any additional authorities I might have to modify a FFP commercial services contract other than those I've outlined above? Thanks in advance for any insight you can provide. -VA1102
I am looking for professional opinions on this issue which has been argued for quite a while in my office. I’ve done my research and feel that 52.243-1 -- Changes -- Fixed-Price, Alternate III is the correct authority based on the following: 1. FAR 52.249-14 – Excusable Delays is not applicable to fixed-price A-E Services per FAR 49.505( and the FAR Clause Matrix. 2. 52.249-8 -- Default (Fixed-Price Supply and Service) was not included in the contract, and although 49.504(a)(1) does not specifically say not to use it for A-E services, the clause matrix shows it not to be used . 3. FAR 49.503( states that 52.249-7, Termination (Fixed-Price Architect-Engineer) is the clause to be used for Termination for Convenience of the Government and Default for A-E services. The clause does not include the liability exception for government delays that is included in 52.249-8 and 52.249-10. 4. 52.243-1 -- Changes -- Fixed-Price, Alternate III allows the Contracting Officer to make changes within the general scope of the contract in the services to be performed, which I consider a PoP extension to be “general scope”. Paragraph (a) is not as specific as the other versions of the clause on what changes can be made. The other side of the argument says that a Changes clause should never be used strictly for a PoP extension. They argue that 52.249-8 -- Default (Fixed-Price Supply and Service) is the correct clause, because a Changes clause should never be use strictly for a PoP extension and there is no other clause to use. Opinions on the correct modification authority and reasoning behind the opinion would be appreciated.