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  • Question

    Can an expired contract be resurrected so that unused funds can be allocated for additional work to be completed. The work is similar to what was done we are just increasing the number of wells to be abandoned and capped. If so would the changes clause be the authority we use to resurrect it?


    Answer

    When the contract has already expired, the contractor is no longer obligated to perform even if funds are available on the contract. If the contractor continues to perform, it does so at its own risk.  While most contractors will want to continue performance and won't want to stop performance, Government personnel should not ask for or knowingly encourage or accept continued performance in the absence of funds on a contract that no longer exist.  Another concern I have is with the wording, "increasing the number of wells", which sounds like additional quantities are being added to the original contract.  Increasing the quantity of a CLIN is generally considered out of scope and could lead to a violation of the CICA statute. 

    However, even if "increasing the number of wells" was determined to be in scope, I do NOT think the expired contract is available any longer to perform the additional work regardless if funds are available.  One alternative might be to de-obligate the funds from the expired contract and re-obligate them on an existing contract (for similar type work) if legal and the Contracting Officer agree that adding additional wells is in scope of the other contract.  Also you should discuss such an approach with your Financial Manager as there could be fiscal law in addition to CICA ramifications.   

    The year and color of money for the funds that are on the expired contract was not provided in your background information.  Generally speaking, however, if the only thing that was being done was extending the PoP to an existing CLIN (before the contract expired) to allow the contractor more time to complete the current work (i.e. no new work), then simply adding (unexpired) funds to an existing CLIN makes sense.  However, if a new contract is created to perform new work or ADDITIONAL quantities are added to an existing CLIN (e.g. out of scope), the funds have to be in the Current Phase of their Appropriation Life-Cycle in order to be obligated to the contract.  For example, OMA funds are only Current for one year, although for service contracts that year could be 12-months that cross fiscal years (ref: 10 USC 2410a).

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