Exercise an Option (SAF)

[Mischia]

Is it possible to exercise an option subject to the availability of funds? I'm looking at FAR Part 17.207 and it states a CO may exercise an option only after determining that funds are available; however I'm thinking of instances when the government does not have funding available (option years beginning on October 1st) and still requires the services.

Thank you-

Mischia

[Desparado]

When I was with DoD, we had many of those situations.

What we would do is issue a modification within the prescribed timeframe to exercise the option stating it was contigent upon the availability of funds, and then on October 1st issue a second modification to assign the funding. Our contract attorney said we "had" to do it this way because if we attempted to exercise an option on October 1st, we couldn't do so unilaterally because the contract expired on September 30th. To me, it seemed like alot of extra work (2 mods times the number of contracts that you have that fall into this situation), but it has become the way that we did things in that office.

[formerfed]

A common practice is for agencies to provide the preliminary notice of intent to exercise the option. The contract clause contains langauge that the government may exercise the option with 30 days after funding becomes avaialble.

Option to Extend the Term of the Contract (Mar 2000)

(a) The Government may extend the term of this contract by written notice to the Contractor within _____ [insert the period of time within which the Contracting Officer may exercise the option]; provided that the Government gives the Contractor a preliminary written notice of its intent to extend at least ___ days [60 days unless a different number of days is inserted] before the contract expires. The preliminary notice does not commit the Government to an extension.

( If the Government exercises this option, the extended contract shall be considered to include this option clause.

© The total duration of this contract, including the exercise of any options under this clause, shall not exceed ___________ (months)(years).