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  • Question

    Does a Determination and Findings (D&F) need to document the fair and reasonableness of option period (it's priced) for IDIQ contract which will not be funded at option exercise or is it only completed at the individual task order levels


    Answer

    The FAR clearly establishes the need for determining a price to be fair and reasonable price before a Government contracting officer or ordering officer may award contracts or place orders.
     
    ACQuipedia Article  - Fair and Reasonable Price Determination (https://acc.dau.mil/CommunityBrowser.aspx?id=338621
     
    The FAR also clearly describes the Determination and Finding (D&F) required to exercise an option.  Per FAR 17.207(f),  the Contracting Officer shall make a written determination (D&F) for the contract file stating that the exercise of this option is in accordance with the terms of the option, the requirements of FAR 17.207, and FAR Part 6.  An option D&F states that "The exercise of the option is the most advantageous method of fulfilling the Government's need, price and other factors considered;".  So, there is a difference between an option D&F and a fair and reasonable determination.
     

    A lot of time and resources were necessary to justify your $45M single award IDIQ.  The FAR allows you to consider that and other factors along with the pricing component in an option D&F.  Each individual task order under the IDIQ will be funded and have its own "fair and reasonable" determination.  The fact that an IDIQ option is unfunded at the time it's exercised isn't an issuefor the option D&F.  The availability of funds requirement in FAR 17.207(c)(1) canbe deferred to the individual task orders.

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