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Are There Certain Clauses That Can or Cannot be Added After Award??


Troy

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In question is a contract due to expire in 30 days. Local OIT requirements now mandate that the contractor purchase all new computers due to network changes (their computers connect to our network). The contract does not contain the clause 52.245-1 authorizing government furnished equipment so can this clause be added with 30 days left on the contract or at anytime for that matter?

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If the contract will be dead in 30 days, leave it alone and let it die.

Does the contract give the Government the responsibility for providing computers for contractor employees? If yes, the Government Property clause is already in the contract. It the contract cost-reimbursement with a stipulation that the Government obtains title for contractor-acquired computers? If yes, the Government Property clause is already in the contract.

But if the answer to both questions is NO, then you probably don't need the clause -- rather, the contractor needs to buy new computers on its own nickel as a cost of doing business with you, at no change in contract price.

I share this in an attempt to be helpful and in light of a paucity of relevant information in the original posting.

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In question is a contract due to expire in 30 days. Local OIT requirements now mandate that the contractor purchase all new computers due to network changes (their computers connect to our network). The contract does not contain the clause 52.245-1 authorizing government furnished equipment so can this clause be added with 30 days left on the contract or at anytime for that matter?

In my opinion, the answer to your question is yes, if a Government change in requirements otherwise makes it necessary for the contractor to purchase new computers to finish the last month of the contract. I'm assuming that the Government would be liable for the additional cost. It would be stupid to have to purchase and set up new computers for a 30 day effort, which I assume the Taxpayers would have to pay for, not to mention lost productivity.

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Troy –While some responses have given you advice on whether the clause should be added or not please consider this with regard to your questions.

Generally any clause can be added to any contract at anytime. Whether it is advisable to add a clause is a whole other debate as evidenced by comments in this thread and other issues that may be specific to any particular contract.

For a commercial item contract the adding of the clause must be by written agreement of both parties (bilaterally) (FAR Clause 52.212-4- Changes paragraph).

For all other contracts covered by the FAR adding a clause could be done either unilaterally, but such an action must be authorized by the terms and conditions of the contract, or bilaterally, if no term and condition allows the unilateral action.

In adding a clause to a contract one would anticipate that there would be a change in the overall cost/price of the contract.

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Even if a Government change in requirements makes it necessary for the contractor to purchase new computers to finish the last month of the contract, it doesn't mean that you have to add the Government Property clause for this purpose -- some pro-rated cost for the computers, less any exchange value for the old computers, might be allowable as part of the change equitable adjustment, maybe. But if you add them as Government Property (or contractor-acquired property, as defined in the Government Property clause), then your agency will own those computers in thirty-one days and you will have to dispose of them.

But none of us know the nature of your contract. Fixed-price or cost-reimbursement? Does the contract require the contractor to provide computers, is it silent, or does it affirmatively put the burden on the Government?

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Even if a Government change in requirements makes it necessary for the contractor to purchase new computers to finish the last month of the contract, it doesn't mean that you have to add the Government Property clause for this purpose -- some pro-rated cost for the computers, less any exchange value for the old computers, might be allowable as part of the change equitable adjustment, maybe. But if you add them as Government Property (or contractor-acquired property, as defined in the Government Property clause), then your agency will own those computers in thirty-one days and you will have to dispose of them.

But none of us know the nature of your contract. Fixed-price or cost-reimbursement? Does the contract require the contractor to provide computers, is it silent, or does it affirmatively put the burden on the Government?

JI, my response above assumed that if the Government Property Clause is added, the Government was going to provide the Contractor existing Government computers to use fior the last 30 days of the contract. Otherwise, I don't know why they would want to add the clause. I may have assumed too much. The whole problem seems to stem from what appears to be a wasteful decision to require a change in computers for a 30 day period! Someone ought to question the sanity of such a decision.

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Here are a few clarifications:

There are two contracts that are firm-fixed commerical services and expire in 30 days and 62 days respectively. The contractor was initially required to purchase computers meeting minimum system requirements. The minimum system requirements have recently changed and my OIT department wants to supply government PCs that we already have in-house.

Otherwise the contractor would need to purchase some 31 PCs as well as turn the hard drives over (the old ones and the new ones) to my OIT department for destruction after the contracts expire. Effectively rendering all the contractors new PCs useless.

In this scenario, it can certainly be implied that the contractor needs to simply pony up in order to maintain a connection to our network (though the contract is silent). Supplying the PCs already updated and in our possession will significantly mitigate any costs as well as save the OIT folks manhours imaging 31 new contractor PCs.

My general question is whether there are any specific clauses we are prohibited from adding to contracts after award?

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Thanks for verifying my hypothesis, Troy. I'll stand by my advice. If a Government change in requirements makes it necessary for the Contractor to purchase new computers to finish the last month of the contract, it is much smarter and more cost effective for the Government to supply government PCs that the government organization already have in-house.Yes the parties can add the GFP clause to the contract.

Regarding ,your general question whether there are any specific clauses we are prohibited from adding to contracts after award, that is too general for me to research this afternoon.

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FFP Commercial Services?

Yes, you can open a negotiation to add the GOVERNMENT PROPERTY clause and provide computers as GFP -- you should consider negotiating a price reduction to reflect the value of the computers that the Government is providing and the contractor is apparently relieved from buying. Since the original poster clarified that the contract is FFP commercial services, I am supposing the original computers purchased by the contractor were not categorized as GFP (or contractor-acquired property under the GFP clause). I wish the original poster had given us this crucial bit of information -- we still don't know.

But the contracting officer cannot unilaterally make this decision. The contractor has to agree. Of course, one will ask why a contractor wouldn't accept such a generous and free gift. But if the contractor doesn't agree, I am still supposing that if push came to shove, the contractor might have the entire burden of providing computers for its employees that fit to the agency network as a material term of being able to perform its responsibilities under the contract. My supposition would not hold if the original contract put the responsibility of providing computers on the Goverrnment. It will depend on the facts of the actual contract.

Here's a comparison for example. If a Government agency decides that it is changing from Microsoft Word version X to Microsoft Word version Y, does it have to modify all of its FFP contracts to cover the contractor cost of version Y? Probably not, unless there is some particular term in the contract that can be pointed to. Absent anything from the original poster suggesting otherwise, and not wanting to agree that any change in existing conditions automatically results in a change to FFP contracts requiring more money from the Government, I'm looking at these computers as just a cost of doing business.

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Depending on the contract language, the cost of the property and the relationship with the Government agency, my company would probably resist either providing new computers or making a cost reduction for property which it may not be able to use effectively elsewhere after 30 days, without equitable adjustment. We have faced this fact situation twice with respect to radios, the specifications for which were changed during performance. Both were FFP contracts for commercial items. Based on the contract language in each instance, we maintained that we had already provided compliant radios and that the changed specifications constituted a contract change. (We may have used alternative arguments, but I'd have to refresh my memory with the files to elaborate.) It wasn't necessary to litigate either instance. In one, our claim for the replacement cost was ultimately allowed. In the other, the Government withdrew its demand that we meet new specifications.

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FFP Commercial Services?

Yes, you can open a negotiation to add the GOVERNMENT PROPERTY clause and provide computers as GFP -- you should consider negotiating a price reduction to reflect the value of the computers that the Government is providing and the contractor is apparently relieved from buying. Since the original poster clarified that the contract is FFP commercial services, I am supposing the original computers purchased by the contractor were not categorized as GFP (or contractor-acquired property under the GFP clause). I wish the original poster had given us this crucial bit of information -- we still don't know.

But the contracting officer cannot unilaterally make this decision. The contractor has to agree. Of course, one will ask why a contractor wouldn't accept such a generous and free gift. But if the contractor doesn't agree, I am still supposing that if push came to shove, the contractor might have the entire burden of providing computers for its employees that fit to the agency network as a material term of being able to perform its responsibilities under the contract. My supposition would not hold if the original contract put the responsibility of providing computers on the Goverrnment. It will depend on the facts of the actual contract.

Here's a comparison for example. If a Government agency decides that it is changing from Microsoft Word version X to Microsoft Word version Y, does it have to modify all of its FFP contracts to cover the contractor cost of version Y? Probably not, unless there is some particular term in the contract that can be pointed to. Absent anything from the original poster suggesting otherwise, and not wanting to agree that any change in existing conditions automatically results in a change to FFP contracts requiring more money from the Government, I'm looking at these computers as just a cost of doing business. If this is a commercial services contract then yes, both parties must agree to the change

Tho' not clear, it appears that the Government has changed the minimum computer requirements near the end of the contract. The contractor already met its responsibility to provide computers that met the then existing requirements. The question relates to whether the Government can furnish compliant computers for contractor use in lieu the contractor having to purchase new equipment to finish the contract's last 30 days of performance. The latter option will - probably- result in a cost to the taxpayers - and which is probably a wasteful scenario for both parties.

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