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  • Question

    Can you please provide some insight as to how this would be accomplished in an effective manner?


    Answer

    Without any specific information, we can only provide you with general advice.  You will need to address any contractual issues with the current contract.  Is the contract ready to expire?  Are you terminating it?  Are you modifying a sole source contract?  I suggest you reference FAR 16.303 Cost-sharing contracts which states that a cost-sharing contract may be used when the contractor agrees to absorb a portion of the costs, in the expectation of substantial compensating benefits. 

     

    Also the corresponding Limitations in FAR 16.301-3 need to be addressed: 

     

    (a) A cost-reimbursement contract may be used only when

     

    (1) The contractor’s accounting system is adequate for determining costs applicable to the contract; and

    (2) Appropriate Government surveillance during performance will provide reasonable assurance that efficient methods and effective cost controls are used;

     

    (b) The use of cost-reimbursement contracts is prohibited for the acquisition of commercial items (see Parts 2 and 12).

     

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