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We are working on a new task order where the current option year of the basic contract will expire tomorrow.  The contractor has agreed to honor their current option year price for the task order even though the new option year will reflect a slightly higher price. Would accepting the contractors current option year price be in violation of the contract terms and conditions?  

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My take is you need to change the contract price for this task order so that your payment office knows how much to pay in accordance with the contract. Otherwise, it seems they should pay this task order at the new option year contract price. I assume you can not issue this task order before the end of tomorrow.

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For some background insight into the appropriate principle at play, see FAR 52.215-1(c)(3)(ii)(B) and 52.212-1(f)(2)(ii).

Can a seller (contractor) give a customer (Government) an unsolicited discount?  YES
- As an inducement to get the Government to select it for a contract award?  YES
- As an inducement to get the Government to exercise an option it might not exercise?  YES

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