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  • Question

    Can the base year of an IDIQ commercial services contract (Janitorial 561720) consists of the entire contract capacity ($944K)? Can the remaining capacity be rolled over to the subsequent option year as the options are exercised IAW 52.217-9?


    Answer

    After reviewing the information submitted, we determined that you must write your contract to identify and award only the known requirements for a given time period (fiscal year) for which you have funds.  You intended to award a contract with a potential value of $944K (for janitorial service - commercial) and appears from your background to cover more than a fiscal year.  In addition to possibly violating the bona fide needs rule, you also expose yourself to potentially having an anti-deficiency situation.  You do not say, but we assume the $944K is not in your budget.  With an IDIQ you have an argument that an anti-deficiency infraction does not exist.  We are not clear how you would operate the contract with regard to exercising work, but if you intend to use this as an IDIQ and piecemeal the work, it is inefficient and, from the contractor's point, harder to plan for.  If you intend to award all work of a given year at the outset, then a base and option structure is more efficient.

     

    You should have further discussions with your contracting officer, financial team and legal counsel to get a clearer understanding of their reasoning.

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