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  • Question

    Is the act of issuing a Request for Proposal create or authorize an obligation if funds are not yet available for that modification, such that there is a possible Anti-Deficiency Act violation? The contractor is not being asked to perform the work described in the RFP, but it will take some effort on the part of the Contractor simply to prepare the proposal.


    Answer

    The actual issuance of a Request for Proposal does not incur an obligation for the government against this particular MILCON effort.  The Bid and Proposal costs incurred by the contractor would go into their General and Administrative expenses, allocated across their entire business base.  While the referenced FAR clause (32.702) does not pertain to this situation, it would be a good idea to clearly state for the contractor in the RFP language that they are not entitled to direct reimbursement of bid and proposal costs to this effort and make them aware that the government does not currently have approval and funds from the Congress for the effort.
     
    The actual signing of the contract modification would incur an obligation to the government and would require approval and receipt of funds from the Congress before signing the modification.

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