ji20874

Sorry -- my [open parenthesis] b [close parenthesis] and my my [open parenthesis] c [close parenthesis] were turned into something else by the automatic editor. How about if I write it with spaces: FAR 16.601 ( b ) ( 1 ) and ( c ) ( 2 )... ji

I tend to discern that you're a contractor employee, and you make mention of T&M subcontracts. You're right that FAR 16.601((1) and ©(2) seem to suggest that federal prime T&M contracts should have fixed hourly rates (not floating ceiling rates). But your question seems to be about subcontracts. Are you talking about subcontracts to federal prime contracts? ji

ashleyh, I like Brian's approach -- do what is best for your organization -- if your FFP services contract specifies monthly invoicing, then it's monthly invoicing unless you decide there is a benefit to your organization to entertain a change proposal (including consideration) from the contractor. But please don't go to twice-a-month invoicing just because the contractor wants it. The contractor should have other mechanisms to finance its operations. Perhaps your contract is based on monthly items (such as an annual need described in the contract's schedule as 12 MONTHS, where each month's service is severable). In this case, your contract probably includes the Payments clause at FAR 52.232-1 without any progress payments or other contract financing clauses. In this case, you pay for each completed month and your contract has no authority for progress or other contract financing payments -- and this is probably the right answer and should be left alone. Maybe all of the competitors in the original acquisition proposed with an understanding that progress or other contract financing payments would not be available. If other competitors had known that contract financing would be available, they might have proposed differently and one of them might have ended up as the successful offeror. After all, contract financing is a real cost that every prudent contractor has to bear, and the Government's carrying of that real cost should result in a lower proposed contract price. So if you do give the contractor some contract financing arrangement after award, please be sure to obtain an appropriate price reduction or other consideration to reflect the contractor's lower costs and the Government's increased administrative and financial burden. ji