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Showing results for tags 'availability of funds'.
Scenario: A Contractor is awarded an Indefinite Delivery Requirements Type Contract for services (various types of Instructors that will teach specific classes) whereby the contract is awarded subject to FAR 52.232-18- Availability of Funds, and the Government must issue task orders to actually order and fund the services. The contract includes CLINs for each Instructor, and vendors had to provide a fully burdened fixed hourly rate for each Instructor that would teach the classes. Question: Must the Contractor hire Instructors and submit the Instructors for Government required background checks before such time as the Government issues a task order and obtains funds? At the solicitation phase, vendors were not required to submit credentials of personnel, nor were vendors required to have any Instructors on staff. My concern is that the Government is requiring the Contractor to perform and to incur costs for a contract that is not funded, and when no orders have been issued. The Government says that furnishing personnel for the background checks is not really "performing" because the classes will not be taught, and is instead a condition of the contract. Even if furnishing personnel for the background checks is a condition of the contract, must a Contractor meet this condition when the contract is not funded, and is subject to FAR 52.232-18- Availability of Funds?
When is it appropriate to use the clause, FAR 52.232-18 'Availability of Funds' in solicitations? Working for the Army it has been observed that often times, especially for O&M requirements towards the end of the FY, a contracting office may issue solicitations without express assurance from a requiring activity that a certain, reasonable amount of funds are available for and will be commited to the specific requirement being solicited. In such cases Contracting Officers include the clause, FAR 52.232-18 'Availability of Funds' in the solicitation with the expectation that the requirement may not make it to contract award (could be because the requiring activity doesn't like the price, or has decided to re-prioritize it's funds elsewhere). This practice has been questioned, however, since that clause is prescribed by by FAR 32.705-1(a) for use 'in solicitations and contracts if the contract will be chargeable to funds of the new fiscal year and the contract action will be initiated before the funds are available.' And further, the Army has an agency specific restriction found at AFARS 5101.602-2(a)(1) that states, 'Except as authorized in FAR Subparts 17.1 and 32.7.., before issuing a solicitation, the contracting officer must have a written statement (or equivalent) indicating that sufficient funds are available.' One interpretation of this is that the exceptions at FAR Subparts 17.1 and 32.7 apply to multi-year and/or incrementally funded contracts, and outside those types of requirements, 52.232-18 is inappropriate and the Contracting Officer should have express funding assurance before issuing a solicitation. Another interpretation is that the FAR allows wide latitude in many cases (this being one of them), and the prescription at FAR 705-1(a) only suggests some but not all potential appropriate situations for including FAR 52.232-18 and soliciting without specific funding assurance. It has also been argued that using FAR 52.232-18 while operating under a CRA is almost always appropriate, since, essentially, all solicitations meet the presription at 32.705-1(a) and are 'subject to availablity of funds'. While investigating this issue other pertinent regulations & policy guidance has been consulted, including FAR subparts 1.6, 17.1 & 32.7 (and associated DFARS/AFARS regs), the DoD FMR (vol14 ch2), and the JAG fiscal law deskbook (ch4).