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  • Question

    By exercising this option, what exactly did I do? Did I essentially create a new and distinct period of performance (date option to extend services was exercised through end of option period), or did I extend Option Period 1's period of performance by 6 months? If the latter applies, did I violate 41 U.S.C. 2531 by creating a period of performance greater than 12 months when factoring in the additional 6 month period resulting from exercising the option to extend services clause? And if so, does 41 U.S.C. 2531still apply to the new obligated amount, thus allowing the contract's extended POP to cross fiscal years and allow the newly obligated funds to be available for up to 12 months? This last question is based on the assumption that I may have turned Option Period 1 into an 18 month period of performance in violation of the 12 month rule. Is it permissible to exercise the option to extend services clause if doing so will cause the total period of performance to exceed 12 months? What effect, if any, does exercising the option to extend services have on funds that are currently obligated on the contract? Do the funds expire at the end of their period of availability? Or are they "extended" as well (although I suspect this is not the case)? And lastly, if my handling of this modification was incorrect, what would have been the proper way to execute it?


    Answer

    The FAR allows, under 52.217-8, the extension of services for a period not to exceed a total of 6 months in circumstances beyond the control of the Contracting Officer.  The examples given in the FAR are delays caused by such things as a bid protest or an alleged mistake in bid.  The additional 6 months would not increase the total term of the option to 18 months but would be an additional 6 months separate from the initial option.  Any appropriate Determination and Findings and Justification and Approvals required by FAR Part 6 must be included in the file.  The executed modification should include the appropriate funds for the period of extension as permitted by the Agency, (Department of Commerce and Bureau of Census) rules. 

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