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    FAR § 17.204(e) = The “periods” limit on service contracts = 5 years total. Mentions FAR 22.1002-1 FAR 22.1002-1 = Under title 41 U.S.C. 6707(d) “term of years” = not to exceed 5 years. FAR 17.204(e) allows for longer contracts, if approved in accordance with agency procedures DFARS 217.204(e)(i) = DOD agency procedure exception. Notwithstanding = exceptions to the rules. DFARS 217.20 (e)(i) includes the words “task order contract”. The term “task order contract” means a service contract not a supply contract. DFARS 217.204(e)(i)(A) specifically allows the “ordering period” to be 5 years for service contracts. DFARS 217.204(e)(i)(B) Specifically allows the “ordering period” subsequently extended (past 5 years) for one or more “periods” utilizing option clauses or modifications. DFARS 217.204(e)(i)(C) specifically limits “ordering periods” to a max of 10 years. Therefore, in theory, the base ordering period could be a total of 5 years total with five 1 year (12 month) option years (total 10 years) correct? Question, does a service contract awarded under(DFARS 217.204(e)(i) (10 U.S.C. 2304a) overrule the limitations in FAR 22.1002-1( 41 U.S.C. 6707(d)) “term of years” = not to exceed 5 years? How does the Service Contract Act interact with IDIQ contracts under DFAR 217.204(e)(i)? Using the scenario 5 year ordering period to include two (12 month) option years and one 6 month option period, How often would the winning vendor be subject to future changes in the wage rates? For example, would the winning vendor’s employees be locked into the original contracts wage rates for the first 5 years of the IDIQ ordering period without subject to future changes to the wage rate? Is it safe to assume that each “option” year is treated by the department of labor as a “new contract” and therefore each “option” exercised would be subject to new wage rates?


    Answer

    Wow, there is a lot to digest here.  But I think I can make this very simple for you.

    If you get authority to exceed the 5 year rule then you would not be in violation of FAR 22.1002-1 (41 U.S.C. 6707(d)); they go together.  The language in FAR part 17 and DFARS part 217 were written to be compliant with FAR subpart 22.10.  The exception authority also was written to take that into account.  The legal review of your file (assuming you do get agency approval) will verify this.

    In order to incorporate the Service Contract Labor Standards (formerly the Service Contract Act) you will need to focus on FAR 22.1007(c) and FAR 52.222-43.  The first tells you when the contracting officer shall obtain wage determinations for a multiple year service contract (annually if annual appropriations and no later than 2 years if not annual appropriations).

     

    The second, your solicitation and resulting contract will contain the Clause 52.222-43 Fair Labor Standards Act and Service Contract Labor Standards-Price Adjustment (Multiple Year and Option Contracts).  If you read paragraph (d), FAR 52.222-43(d) it provides the guidance on how to structure your options so that you can modify the contract (and task orders) to incorporate updated wage determinations (conformed wage rates, wages covered, by CBA, etc.).

    Hope that helps.

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