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we are a prime contractor and we have a CPFF task order from our government customer, and I issued a CPFF subcontract to support our task order.

Eight (8) line items are on the subcontract, to align with the 8 different tasks in our task order SOW.  the 8 lines on the subcontract are representative of how we proposed, which was a skill mix of labor to support each task.  This is all labor subcontract, engineering services.  Funding is running out on one of the subcontract line items, and I was going to move money off one line to another

 PM said we can't do that.  My question is why can't we?

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17 minutes ago, general_correspondence said:

... the 8 lines on the subcontract are representative of how we proposed, which was a skill mix of labor to support each task.  

You should ask your PM why "we can't do that." I am guessing the rationale is more about your program than about whether your contract terms prohibit you from doing so. Program wise, it seems to me that if you are running out of funding, that line item is not being managed according to how it was proposed. Perhaps the labor mix being performed by the subcontractor is out of wack, or the work is being performed ahead of schedule or there are technical problems causing more work than proposed/planned.

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I have asked my PM.  And your assumption is correct, it has something to do with prime contract structure and funding.  I understand how our customer can direct us (the prime) NTE limits on CLINS, but PM is saying this flowed down to subcontracts as well.  I looked at how we proposed our task order, and it did have subcontractors costs broken down in each task, but how that relates to subcontract management of a CPFF subcontract is a matter of communication. News to me, especially since it wasn't a part of the direction or discussion when we awarded the subcontract.

 

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Do not assume that the contractor is allowed to shift funds between line items. They might be different appropriations and/or funds sources/types

If you’re asking about a shift within subcontractor line items, you have to look at the overall management of all of the line items.

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 General, I would not be so sure that what you have is a communication issue instead of a compliance with your prime contract issue.  You said your PM explained that your inability to shift funds within the subcontract had "something to do with prime contract structure and funding."  Let us assume the following scenario.  Your prime contract is a cost reimbursement contract and has two CLINs, each funded with a different appropriations.  The contract prohibits you from shifting funds between the two CLINs.  You award a cost reimbursement contract that closely mirrors the prime contract with two CLINs similar to the two CLINs in the prime contract.  The subcontractor incurs more costs in performing one of the CLINs than anticipated, but is under running the other CLIN.  Shifting funds from the under run CLIN to the overrun CLIN on the subcontract, will cause an overrun on one of the prime CLINs which you may have to eat.

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