Performance Based Payments Guidebook (PBP)

Although Performance Based Payments (PBPs) have been authorized for use as a type of customary contract financing since 1996, most contracting and acquisition professionals are not familiar with the steps necessary to create an effective PBP arrangement. Unlike progress payments which are incorporated by simply including the appropriate clause, PBPs require considerable thought and effort on both sides to construct the detailed PBP arrangement that will be documented in a special provision in the contract.