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Basic Agreements and Individual Orders


Whynot

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Are any regulations/statutes triggered if the cumulative value of orders under a Basic Agreement/Basic Ordering Agreement reach a particular threshold or value? It is my understanding that these orders are individual contracts and there is no basis to sum orders for such purposes - is this correct?

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Couldn't the orders trigger or affect CAS requirements under certain circumstances?

For instance, assume the contractor is not currently subject to CAS because none of its contracts are greater than $7.5 million in value, but then it receives a single order in excess of $7.5 million. Would not future orders in excess of $650,000 be subject to CAS (assuming no other exemption was available)? Would not those CAS-covered orders need to be tracked and aggregated to determine the level of CAS coverage?

For instance, assume the contractor was subject to CAS (or became subject to CAS under the above scenario), but was able to claim modified coverage because it did not receive more than $50 million in CAS-covered contracts in a single year. However, in the next year it received a number of orders under the BOA whose aggregated value exceeded $50 million. Would not future orders in excess of $650,000 be subject to full CAS coverage (as opposed to modified coverage)? Would not the contractor then be required to file a CASB DS-1 Disclosure Statement?

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The scenario suggested by here_2_help has nothing to do with the Basic Agreement/BOA, though. That would be true whether the awards were orders under an agreement or were individual contracts.

Vern: Can you share what those regulations/statutes would be? Thanks!

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Linda,

I belive Vern's "yes" answer was in response to the second part of Whynot's statement - "It is my understanding that these orders are individual contracts and there is no basis to sum orders for such purposes - is this correct? "

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Guest Vern Edwards
Linda,

I belive Vern's "yes" answer was in response to the second part of Whynot's statement - "It is my understanding that these orders are individual contracts and there is no basis to sum orders for such purposes - is this correct? "

That was my intent. However, my answer was not entirely correct. There are rules that kick in when a contractor's aggregate awards cross a certain threshold, e.g., EEO. So, awards under BAs and BOAs are individual contracts, but you do have to aggregate total awards for purposes of compliance with some rules. That is true whether the awards were under BAs/BPAs or not.

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  • 3 weeks later...
Are any regulations/statutes triggered if the cumulative value of orders under a Basic Agreement/Basic Ordering Agreement reach a particular threshold or value? It is my understanding that these orders are individual contracts and there is no basis to sum orders for such purposes - is this correct?

Your question is similar to one that I am trying to find the answer to. Anyone who can help point me in the right direction would be greatly appreciated. The scenario is this: Our company currently has a firm-fixed-price contract for a construction project. During the course of the project other additional work has been identified that would add cost and time to the current contract. However, the additional work is within the current Scope of Work. My question is this, "Does the FAR, DFAR, or other Court findings impose a cap limit by percentage or monitary amount how much a current contract can be modified, if additional work is still within the SOW?"

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Your question is similar to one that I am trying to find the answer to. Anyone who can help point me in the right direction would be greatly appreciated. The scenario is this: Our company currently has a firm-fixed-price contract for a construction project. During the course of the project other additional work has been identified that would add cost and time to the current contract. However, the additional work is within the current Scope of Work. My question is this, "Does the FAR, DFAR, or other Court findings impose a cap limit by percentage or monitary amount how much a current contract can be modified, if additional work is still within the SOW?"

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Your question is similar to one that I am trying to find the answer to. Anyone who can help point me in the right direction would be greatly appreciated. The scenario is this: Our company currently has a firm-fixed-price contract for a construction project. During the course of the project other additional work has been identified that would add cost and time to the current contract. However, the additional work is within the current Scope of Work. My question is this, "Does the FAR, DFAR, or other Court findings impose a cap limit by percentage or monitary amount how much a current contract can be modified, if additional work is still within the SOW?"

The simple answer to your question is "No" there's no monetary limit to contract changes.

However, we all know that contract administration isn't simple. so I'll try to summarize what you need to consider.

First, is the proposed change really within the scope of work? How can you tell? This is where it gets complicated and the lawyers step in.

Here are some considerations for determining if a change is within scope:

1. The function of the item hasn't changed.

2. The basic contract purpose hasn't 'changed

3. The magnitude of funds requested for the change is proportionate to the price or estimated cost of the original contract

4. Specification or SOW changes are not extensive.

5. Does the changed work represent what both parties reasonably contemplated at award?

6. Is the changed work essentially the same as was bargained for?

7. Is the nature of the requirement altered by the change?

8. Would this type of change normally be expected for this kind of requirement?

So you see determining within scope is the crux of the issue and that's not simple. Even if you and the CO agree that the change is within scope a competitor might not, especially if it's going to be a substantial sum of money. The competitor could protest that it should be a new, competitively awarded contract.

Thus, the CO needs to determine if the work should be done under the existing contract or a new competition.

You may want to review this guidance from FAI on contract modifications http://www.fai.gov/pdfs/Unit52.pdf

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Your question is similar to one that I am trying to find the answer to. Anyone who can help point me in the right direction would be greatly appreciated. The scenario is this: Our company currently has a firm-fixed-price contract for a construction project. During the course of the project other additional work has been identified that would add cost and time to the current contract. However, the additional work is within the current Scope of Work. My question is this, "Does the FAR, DFAR, or other Court findings impose a cap limit by percentage or monitary amount how much a current contract can be modified, if additional work is still within the SOW?"

Take a look at this thread on cardinal change that appeared a few weeks ago here.

http://www.wifcon.com/discussion/index.php?showtopic=65

The last post by napolik is very informative. Also note his reference to Administration of Government Contracts. That should be very helpful to you.

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