If an IDIQ with a base and 4 one-year options allows for delivery orders with a one-year base and two one-year option periods, what is the status of the two option years if the delivery order is awarded on the last day of the fourth option year period? Do the terms and conditions flow down to the delivery order options even though the IDIQ contract no longer exists? I can see the base year is enforceable but the two delivery order option periods would be renewed after the contract has ended.
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Applicable regulations and statute:
FAR 17.204 Contracts.
(a) The contract shall specify limits on the purchase of additional supplies or services, or the overall duration of the term of the contract, including any extension.
FAR 16.505 Ordering.
(a)(2) Individual orders shall clearly describe all services to be performed or supplies to be delivered so the full cost or price for the performance of the work can be established when the order is placed. Orders shall be within the scope, issued within the period of performance, and be within the maximum value of the contract.
DFARS 217.204 Contracts.
(e)(i) Notwithstanding FAR 17.204(e), the ordering period of a task order or delivery order contract (including a contract for information technology) awarded by DoD pursuant to 10 U.S.C. 2304a—
(A) May be for any period up to 5 years;
(B) May be subsequently extended for one or more successive periods in accordance with an option provided in the contract or a modification of the contract; and
(C) Shall not exceed 10 years unless the head of the agency determines in writing that exceptional circumstances require a longer ordering period.
(e) (iii) Obtain approval from the senior procurement executive before issuing an order against a task or delivery order contract subject to paragraph (e)(i) of this section, if performance under the order is expected to extend more than 1 year beyond the 10-year limit or extended limit described in paragraph (e)(i)(C) of this section (see FAR 37.106 for funding and term of service contracts).
10 USC 2304(e)Contract Modifications.—
A task or delivery order may not increase the scope, period, or maximum value of the task or delivery order contract under which the order is issued. The scope, period, or maximum value of the contract may be increased only by modification of the contract.
Applicable guidance to your question can be found in FAR 17.204 and 16.505 as well as DFARS 217.204 and 10 USC 2304(e). The delivery order in question must be within the ordering limits specified in the basic IDIQ contract. You stated that the contract allows for delivery orders to be issued with a base and option year(s); you need to ensure that none of the other ordering limits stated in the contract are exceeded by this new order (e.g. scope, max value of contract and period of performance). According to 10 USC 2304(e), a delivery order may not increase the scope, period or maximum value of the basic contract under which the order was issued. The new order would be invalid if it increased the scope, period or maximum value of the contract. The scope, period or maximum value of the contract can be increased only by a modification to the contract. Before negotiating such a modification to the contract, I highly recommend discussing it with your Contracting Officer, Competition Advocate and legal advisor to determine if a Justification and Approval is required in accordance with FAR 6.303. Last, the contract and any order that's issued on the last day of the last option period must comply with DFARS 217.204e(i)(C) and (e)(iii); namely, the ordering period shall not exceed 10 years and performance of any delivery order issued cannot exceed 11 years without higher level approval. In order to ensure the delivery order in question complies with the limits in the basic contract as well as applicable laws and regulations, I strongly recommend discussing it further with your Contracting Officer, legal advisor and Competition Advocate.