BorderC Posted July 27, 2011 Report Share Posted July 27, 2011 I have some literature that says the CPFF Term Contract is a variation of the FFP LOE contract type. That suggests that the requirements are the same, but that's not exactly true. 16.306(d) doesn't list the same requirements as 16.207, and doesn't mention a relation. So, that said, other than detailed requirements, are there other limitations to the Term Contract (like under $150k, etc.) that I'm just not seeing, or is the literature (source = NCMA) just wrong? Link to comment Share on other sites More sharing options...
Guest Vern Edwards Posted July 27, 2011 Report Share Posted July 27, 2011 I am not sure that I understand the question: " [A]re there other limitations to the Term Contract (like under $150k, etc.) that I'm just not seeing[?]" Any limitations are stated in FAR Part 16. So I'm going to answer this question: What are the differences between an FFP-LOE-Term contract and a CPFF-LOE-Term contract? First, the FFP-LOE-Term is fixed-price, which means that the contractor must fulfill its obligations acceptably as a condition of payment. It must deliver the specified type and number of hours within the period of performance. The contractor must (a) deliver all of the specified hours, ( doing the type of work specified, and ( c) within the term of the contract. If labor costs go up, that's too bad for the contractor. But if the government is not satisfied with the work accomplished within the level of effort, that's too bad for the Government. Some argue that the work done must be acceptable, but there appears to be no legal support for that argument. Some argue that the work done must be acceptable, but there appears to be no legal support for that argument. Under the CPFF-LOE-Term contract, the contractor is not obligated to deliver the specified number of hours within the term or the estimated cost as a condition of reimbursement. However, if the contractor cannot deliver the specified number of hours within the term and the estimated cost, and if the Government will not provide additional funds, then the contractor should not receive the entire fixed fee. If the hours delivered are not the type specified, or if the type work done is not the type of work specified, then the cost of those hours would be unallowable under the contract and would not count against the level of effort. About the only thing the two contracts have in common is that both specify the contractor's obligation in terms of a number of hours to be delivered within a period of time. Beyond that, they are very different. Both are considered lower in risk than a pure FFP (completion) contract, but the CPFF entails less risk than the FFP. Finally, if you are going to mention a source, such as NCMA, be specific: title, author, date. Referring only to NCMA is not fair to NCMA. Link to comment Share on other sites More sharing options...
BorderC Posted July 28, 2011 Author Report Share Posted July 28, 2011 Sorry for the confusion. The source is titled "Contract Types". There is no author listed but it the copyright is held by NCMA and the book (and workbook) were published by Federal Publication Seminars. The book says that the CPFF Term Form Contract is similar to the FFP/LOE contract, with the price equal to the cost incurred plus a fee..... The workbook goes on to briefly explain FFP/LOE and lists the requirements at 16.207-3. Then it says Variation - Cost-Reimbursement LOE Term Contract So, being new to contracting, I was just wondering why the requirements are not the same. For instance, why a limit of $150k on FFP/LOE and not CPFF/TC? I probably read to much into the "variation" bit and worded my question incorrectly. I'm still learning and don't know the right questions to ask. Thank you for your response. Link to comment Share on other sites More sharing options...
Guest Vern Edwards Posted July 29, 2011 Report Share Posted July 29, 2011 So, being new to contracting, I was just wondering why the requirements are not the same. For instance, why a limit of $150k on FFP/LOE and not CPFF/TC? I probably read to much into the "variation" bit and worded my question incorrectly. I'm still learning and don't know the right questions to ask. Thank you for your response. I don't know why the FFP-LOE-Term is limited to $150,000 or less. The dollar limitation (previously $100,000) is very old. It predates the FAR. I suspect that the reasons are lost to memory. Link to comment Share on other sites More sharing options...
.gif)
Recommended Posts