Can the Contractor proceed with the work before the Modification is in place? Can the Government allow the Contractor to proceed? Can/should the Government issue a unilateral unpriced change order and have the Contractor file a REA? Does that allow the contractor to keep working? How can the Government do an IGE before the D-B Contractor produces a design/study (scope)? The DOR says he needs soils studies, pile design, structural design of the box culvert now that it sits on piles and a redesign of the road above. Is this an ADA violation if the Contractor proceeds to say pile driving?
There are so many potential problems and legal issues with these questions it is difficult to determine which is most important. I will answer your questions first and then attempt to provide supporting rationale.
Open full Question Details
Can the Contractor proceed with the work before the Modification is in place? NO.
Can the Government allow the Contractor to proceed? NO.
Can/should the Government issue a unilateral unpriced change order and have the Contractor file a REA? NO, unless you have funding for at least the initial estimate, the change is within scope and is the type of change allowed by the applicable Changes clause..
Does that allow the contractor to keep working? Not sure of the question.
How can the Government do an IGE before the D-B Contractor produces a design/study (scope)? What is the basis of the IGE and how realistic would it be?
The DOR says he needs soils studies, pile design, structural design of the box culvert now that it sits on piles and a
redesign of the road above. This is just a statement, there is no question.
Is this an ADA violation if the Contractor proceeds to say pile driving? Yes, if the appropriate funding is not available for the change (e.g., if a change is within scope, original funds are used; if it is out-of-scope and an approved J&A authorized the change, current funds are used - see Financial Management Regulation vol. 3, chptr. 6, para. 061001).
There are several FAR references that are applicable as well as definitions.
FAR 1.602-1 (b) No contract shall be entered into unless the contracting officer ensures that all requirements of law, executive orders, regulations, and all other applicable procedures, including clearances and approvals, have been met.
FAR 1.602-2 (a) Ensure that the requirements of 1.602-1(b) have been met, and that sufficient funds are available for obligation;
FAR 52.243-4 CHANGES
FAR 52.242-14 (a) The Contracting Officer may order the Contractor, in writing, to suspend, delay, or interrupt all or any part of the work of this contract for the period of time that the Contracting Officer determines appropriate for the convenience of the Government.
FAR 43.105(a) The contracting officer shall not execute a contract modification that causes or will cause an increase in funds without having first obtained a certification of fund availability...
Constructive Change - An oral or written communication, act or omission by the contracting officer or other authorized government official that is construed as having the same effect as a written change order.
Anti-Deficiency Act - A statute prohibiting government agencies from obligating the government, by contract or otherwise, in excess of or in advance of appropriations...The Act prevents government employees from involving the government in expenditures or liabilities beyond those contemplated and authorized by Congress.
Summary: The authority for a contracting officer to issue either a bi-lateral or unilateral modification to this contract is most likely FAR 52.243-4, Changes. FAR 52.243-4(a)(1) allows the Contracting Officer ...indicated to be a change order, make changes within the general scope of the contract, including changes - (1) in the specifications(including drawings and designs). In order for the change to be made , if in fact the change is within the general scope of the contract, the contracting officer must ensure there are sufficient funds available for obligation IAW with FAR 1.602-2(a) and FAR 43.105(a). You stated plainly in the background statement that no funds would be available for one year! Therefore, you have a potential Anti-Deficiency Act violation if the contractor starts or is directed to start new work. In addition, you inferred that the Government may allow the contractor to continue working. The government cannot allow the contractor continue working on any portion of the "new work" that could be covered under a modification. The government also cannot simply ignore that the contractor is performing work NOT authorized by any contractual document. This is an act of omission that places the government in the position of approving the new work through a
constructive change and again a potential Anti-Deficiency Act violation.
MIL-CON construction projects are line item approved by Congress. A change of $5M may require Congressional approval for the change and the additional funds. A modification cannot be issued until funds are available to the contracting officer for obligation either bilaterally or unilaterally.
Option: can the contractor work on a portion of the construction project not affected by the change? If there is NO doubt that original contractual work can be completed without the modification being issued, then that portion of the work may continue. A partial suspension of work may need to be issued if all remaining work is affected by the future change.
The contracting officer should coordinate any actions closely with a contracts attorney, a funding official, and a senior contract analyst.