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DLAD PART 16 – TYPES OF CONTRACTS



PART 16 – TYPES OF CONTRACTS

TABLE OF CONTENTS

SUBPART 16.1 – SELECTING CONTRACT TYPES

16.105 Solicitation provision.

16.105-91 Alternate Offer Conditional Award.

16.190 Long-term contracting.

SUBPART 16.2 – FIXED PRICE CONTRACTS

16.203 Fixed-price contracts with economic price adjustment.

16.203 Definitions.

16.203-1 Description.

16.203-2 Application.

16.203-3 Limitations.

16.203-4 Contract clauses.

16.205-4 Contract clauses

SUBPART 16.5 – INDEFINITE-DELIVERY CONTRACTS

16.501-2 General.

16.503 Requirements contracts.

16.504 Indefinite-quantity contracts.

16.505 Ordering.

16.506 Solicitation provisions and contract clauses.

SUBPART 16.6 – TIME-AND-MATERIALS, LABOR-HOUR, AND LETTER CONTRACTS

16.601 Time and materials contracts.

16.603 Letter contracts.

16.603-3 Limitations.

16.603-90 Procedures.

SUBPART 16.7 – AGREEMENTS

16.703 Basic ordering agreements.

SUBPART 16.1 – SELECTING CONTRACT TYPES

(Revised July 6, 2012 through PROCLTR 2012-34)

16.105 Solicitation provision.

16.105-91 Alternate offer conditional award.

Use 52.216-9018, Alternate Offer Conditional Award, when clause 52.216-9017 was included in Section I of the solicitation, and award of this contract is made under the condition that an alternate offer will be approved.

16.190 Long-term contracting.

(a) Scope of section. This section and PGI 16.190 prescribe policy and procedures applicable to the Defense supply centers for establishing and processing long-term contracts (LTC) [at all dollar values for supplies and services in support of DLA customers for all primary level field activities. Additional LTC policy is contained elsewhere in the DLAD (see parts 4, 7, 9, 10, 11, 13, 15, 16, 17, 46, and 47).

SUBPART 16.2 – FIXED PRICE CONTRACTS

(Revised September 12, 2011 through PROCLTR 2011-30)

16.203 Fixed-price contracts with economic price adjustment.

16.203-90 Definitions.

As used in this section---

16.203-1 Description.

16.203-290 Application.

16.203-390 Limitations.

16.203-4 Contract clauses – EPA and adjustments or indexes.

16.203-4(a)(2)(90) EPA – Established catalog price. two upward adjustments per year open season E-CAT solicitation.

Use 52.216-9040, Economic Price Adjustment – Established Catalog Price Two Upward Adjustments Per Year Open Season E-CAT Solicitation, in medical FAR Part 12 solicitations and contracts for the equipment ECAT/CVC Program where offered prices are based upon established catalog/list prices, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, and the resulting contract will be placed on the medical electronic catalog (ECAT) web based ordering system.

Upward adjustments are based on increases in list prices and may be requested by the contractor twice each contract year. Downward adjustments are mandated whenever the contractor’s list prices decrease and/or whenever the contractor has a Federal supply schedule (FSS) for the same item and that price is reduced to one that is lower than the current unit price on the medical contract.

For dental, optical and laboratory integrated delivery system (LIDS) buys, use 52.216-9047, Economic Price Adjustment – Established Catalog Price One Upward Adjustment per Option Year E-Cat Solicitation. This clause may be appropriate for other medical ECAT acquisitions. Consult with the pricing and strategy division, DLA Troop Support, prior to use.

16.203-4(a)(2)(91) EPA, FSS prices, open season E-CAT solicitation, medical FAR Part 12 solicitations and contracts.

Use 52.216-9041, Economic Price Adjustment – Federal Supply Schedule Prices – Open Season E-CAT Solicitation, in medical FAR Part 12 solicitations and contracts for the equipment ECAT/CVC program, where adjustments will be based upon price changes in the contractor's Federal Supply Schedule (FSS) contract for the same items, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, and the resulting contract will be placed on the medical electronic catalog (ECAT) web based ordering system. Upward adjustments may be requested by the contractor whenever the FSS price for an item increases. Decreases are mandated whenever FSS prices decrease.

For dental, optical, and laboratory integrated delivery system (LIDS) buys use Economic Price Adjustment – Established Catalog Price One Upward Adjustment per Option Year E-Cat Solicitation. This clause may be appropriate for other medical ECAT acquisitions. Consult with the pricing and strategy division, DLA Troop Support, prior to use.

16.203-4(a)(2)(92)

Use 52.216-9043, Economic Price Adjustment – Federal Supply Schedule Prices, in medical FAR Part 12 solicitations and contracts where adjustments will be based upon price changes in the contractor's Federal Supply Schedule (FSS) contract for the same items, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant contract, the resulting contract will not be placed on the Medical Electronic Catalog (ECAT) web based ordering system, and the concurrence of the Pricing and Strategy Division DLA Troop Support, is received prior to using the clause.

Upward adjustments may be requested by the contractor whenever the FSS price for an item increases. Decreases are mandated whenever FSS prices decrease.

16.203-4(a)(2)(93)

Use 52.216-9044, Economic Price Adjustment – Established Catalog Price – Multiple Adjustments Authorized per Clause Terms – non-ECAT, in Medical FAR Part 12 solicitations and contracts where offered prices are based upon established catalog/list prices, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, the resulting contract will not be placed on the medical electronic catalog (ECAT) web based ordering system, and the concurrence of the pricing and strategy division, DLA Troop Support, is received prior to using the clause.

Upward adjustments may be requested by the contractor whenever the list price for an item increases. Downward adjustments are mandated whenever the contractor's list prices decrease and/or whenever the contractor has a Federal Supply Schedule (FSS) for the same item and that price is reduced to one that is lower than the current unit price on Medical's contract.

16.203-4(a)(2)(94) EPA, other federal agency contracts, E-CAT,medical far part 12 solicitations and contracts for the dental, optical, and laboratory integrated delivery system ECAT/CVC program.

Use 52.216-9045, Economic Price Adjustment – Other Federal Agency Contracts – E-CAT– One Upward Adjustment Per Option Period, in medical FAR Part 12 solicitations and contracts for the dental, optical, and laboratory integrated delivery system (LIDS) ECAT/CVC program, where adjustments will be based upon price changes occurring on the contractor's other Federal agency's (OFA) contract for the same items, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, and the resulting contract will be placed on the medical electronic catalog (ECAT) web based ordering system.

For equipment ECAT Program buys use 52.216-9041, Economic Price Adjustment – Federal supply Schedule Prices – Open Season E-Cat Solicitation. This clause may be appropriate for other medical ECAT acquisitions. Consult with the pricing and strategy division, DLA Troop Support, prior to use.

16.203-4(a)(2)(95) EPA, other federal agency contracts, E-CAT, in medical FAR Part 12 solicitations and contracts.

Use 52.216-9046, Economic Price Adjustment – Other Federal Agency Contracts – E-CAT, in Medical FAR Part 12 solicitations and contracts (including CVC type buys) where adjustments will be based upon price changes occurring on the contractor's other federal agency's (OFA) contract for the same items, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, the resulting contract is to be placed on the medical electronic catalog (ECAT) web based ordering system, and the concurrence of the pricing and strategy division, DLA Troop Support, is received prior to using the clause.

For dental, optical, and laboratory integrated delivery system (LIDS) buys use 52.216-9046, Economic Price Adjustment – Other Federal Agency Contracts – E-CAT.

For equipment ECAT Program buys use 52.216-9041, Economic Price Adjustment – Federal Supply Schedule Prices - open season e-cat solicitation.

16.203-4(a)(2)(96) EPA, established catalog price one upward adjustment per option year e-cat solicitation, in medical FAR Part 12 solicitations and contracts for the dental, optical, and laboratory integrated delivery system ECAT/CVC program.

Use 52.216-9047, Economic Price Adjustment – Established Catalog Price One Upward Adjustment Per Option Year E-Cat Solicitation, in medical FAR Part 12 solicitations and contracts for the dental, optical, and laboratory integrated delivery system (LIDS) ECAT/CVC program where offered prices are based upon established catalog/list prices, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, and the resulting contract will be placed on the medical electronic catalog (ECAT) web based ordering system.

For equipment ECAT Program buys use 52.216-9040, Economic Price Adjustment – Established Catalog Price Two Upward Adjustments Per Year Open Season E-Cat Solicitation.

This clause may be appropriate for other medical E-CAT acquisitions. Consult with the pricing and strategy division, DLA Troop Support, prior to use.

16.203-4(a)(2)(97) EPA, established catalog price, multiple adjustments authorized per clause terms – E-CAT solicitation, in medical FAR Part 12 solicitations and contracts.

Use 52.216-9048, Economic Price Adjustment –Established Catalog Price – Multiple Adjustments Authorized per Clause Terms – E-CAT Solicitation, in medical FAR Part 12 solicitations and contracts where offered prices are based upon established catalog/list prices, the contracting officer determines an EPA is appropriate, the adjustment scenario below is suitable for the instant acquisition, the resulting contract will be placed on the medical electronic catalog (E-CAT) web based ordering system, and the concurrence of the pricing and strategy division, DLA Troop Support, is received prior to using the clause.

For dental, optical and laboratory integrated delivery system (LIDS) buys use 52.216-9047, Economic price adjustment – established catalog price one upward adjustment per option year e-cat solicitation.

For equipment E-CAT program buys use 52.216-9040, Economic price adjustment – established catalog price two upward adjustments per year open season E-CAT solicitation.

16.203-4(a)(2)(98) EPA, published market price, domestic bulk in domestic bulk fuel.

For DLA Energy only: Insert the clause 52.216-9069 Economic Price Adjustment -- Published Market Price - Domestic Bulk In Domestic Bulk Fuel in solicitations/contracts when a price adjustment is based on an independent published price listing. The clause requires buyer fill-in of applicable ceiling at subparagraph (c)(5), as well as completion of the paragraph (g) with a description of the specific market prices to be used, along with any explanatory notes (notes 2 and 3). The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(5) as determined by the chief of the contracting office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). The buyer shall coordinate with the market research section before completion of fill in the blank information sections of the clause such as base market, and publication dates, to ensure the accuracy of the information and the correct selection of the market price.

16.203-4(a)(2)(99) EPA, published market price, electricity, heat rate.

Insert the clause 52.216-9068 Economic price Adjustment – Published Market Price - Electricity – Heat Rate in DLA Energy solicitation/contracts for electricity solicitations/contracts when soliciting under the heat rate block and index method. This clause may be used in markets where natural gas represents a substantial power generation fuel source and the customer requests that DLA Energy purchase electricity using heat rate pricing. Requires buyer fill-ins at paragraph (b), subparagraphs (i), (ii), (ii)(6), (ii)(7), (ii)(8, (ii)(9), (ii)(10), (ii)(11), and paragraphs (c) and (f). The contracting officer shall insert the appropriate ceiling percentage in paragraph (f) as determined by the chief of the contracting office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). The index to be used must be a natural gas futures price from the New York Mercantile Exchange (NYMEX). If any other index is to be used the buyer shall coordinate with the market research section, DLA Energy, before completion of fill in the blank information sections of the clause such as base reference price, and publication dates, to ensure the accuracy of the information and the correct selection of the market (reference price).

16.203-4(a)(2)(100) EPA, market price, posts, camps, and stations, Korea, Guam, Japan.

Insert the clause 52.216-9071 Economic Price Adjustment - Market Price - Posts, Camps, and Stations - Korea/Guam/Japan in DLA Energy solicitations/contracts for Posts, Camps, and Stations (PC&S) for Korea, Guam or Japan. The contracting officer is required to insert a header in paragraph (c) for Korea and Guam. When using this clause for Japan, the contracting officer is required to insert a header as well as other language covering delivery and notification (See Note 1 to the clause). The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(5) as determined by the Chief of the Contracting Office or designee (reference note 2 of the clause). Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). The contracting officer shall coordinate with the market research section, DLA Energy, before completion of fill in the blank information sections of the clause such as base market, and publication dates, to ensure the accuracy of the information and the correct selection of the market price. Refer to Note 3 of the clause in reference to coordination with the market research section

16.203-4(a)(2)(101) EPA, petroleum product price, post camp and station.

Insert the clause at 52.216-9072 Economic Price Adjustment (EPA) – Petroleum Product Price, Post Camp and Station (PC&S) in all domestic PC&S solicitations and resulting contracts. The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(4) as determined by the Chief of the Contracting Office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). The buyer shall insert applicable date for each publication in paragraph (f). For OPIS, the Monday date of the publication shall be used. Requires fill-in (see paragraphs (b)(2), c(4), and (f). The buyer shall coordinate with the market research section, DLA Energy, before completion of fill in the blank information sections of the clause such as base reference price, upward ceiling, and publication dates, to ensure the accuracy of the information.

16.203-4(a)(2)(102) EPA, petroleum product market price, post camp and station Belgium.

Insert the clause at 52.216-9073 Economic Price Adjustment (EPA) – Petroleum Product Market Price, Post Campus and Station (PC&S) Belgium in all PC&S solicitations and resulting contracts for Belgium. The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(5) as determined by the Chief of the Contracting Office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). Requires buyer fill-in of paragraph (c)(5). The buyer shall coordinate with the market research section, DLA Energy, before completion of fill in the blank information sections of the clause to ensure the accuracy of the information.

16.203-4(a)(2)(103) EPA, daily market price indicators, ships’ bunkers.

Insert the clause 52.216-9070 Economic Price Adjustment – Daily Market Price Indicators (Ships’ Bunkers) in DLA Energy solicitations and resulting contracts when a daily economic price adjustment escalator is used. The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(4) as determined by the Chief of the Contracting Officer or designee. Explicit approval must be obtained for any ceiling exceeding (10) percent in accordance with 16.203-3(94). Requires buyer fill-ins at paragraph (c)(4) and (f). The buyer shall coordinate with the market research section, DLA Energy, before completion of fill in the blank information sections of the clause such as base reference price, and publication dates to ensure the accuracy of information and the correct selection of the market (reference price).

16.203-4(a)(2)(104) EPA, market price and actual transportation cost, natural gas.

Insert the clause 52.216-9074 Economic Price Adjustment - Market Price And Actual Transportation Cost - Natural Gas - Alaska in DLA Energy solicitations and contracts for direct supply natural gas in Alaska. The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(2) as determined by the Chief of the Contracting Office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). The contracting officer must complete the applicable ceiling in Note 1 of paragraph (c)(2).

16.203-4(a)(2)(105) EPA, market price indicators, ships' bunkers, weekly.

Insert the Clause 52.216-9075 Economic Price Adjustment – Market Price Indicators - Ships' Bunkers in DLA Energy solicitations and contracts for ships' bunkers solicitations/contracts when market publications will be used for price escalation on a weekly basis. The contracting officer shall insert the appropriate ceiling percentage in paragraph (c)(4) as determined by the Chief of the Contracting Office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3 (94). The buyer shall coordinate with the Market Research Section, DLA Energy, before completion of fill in the blank information sections of the clause such as base market, and publication dates, to ensure the accuracy of the information and the correct selection of the market price.

16.203-4(d)(2) Clauses – consumer price index and economic price adjustment.

16.203-4(d)(2)(90)

Use 52.216-9042, Economic Price Adjustment (EPA) – Department of Labor Bureau of Labor Statistics – consumer price index, in medical FAR Part 12 solicitations and contracts under the DoD/VA Shared Procurement Program when the contracting officer determines that an EPA is appropriate, the adjustment scenario below, which is based on changes in the Consumer Price Index (CPI), is suitable for the instant acquisition and the concurrence of the C&P Medical Support Team is received prior to using the clause.

Adjustments are based upon changes in the CPI for the expenditure category "prescription drugs and medical supplies" or "nonprescription drugs and medical supplies." Upward adjustments may be requested by the contractor once annually to cover each option year. Downward adjustments during the option years are mandated whenever the CPI goes down. An additional downward adjustment is mandated whenever the contractor has a federal supply schedule (FSS) for the same item and that price is reduced to one that is lower than the current unit price on Medical's contract.

16.203-4(d)(2)(91)

Use 52.216-9049, Economic Price Adjustment (EPA) of the annual management fee(s) and annual management cost(s) for the option years, in medical solicitations for readiness items which result in corporate exigency contracts or vendor managed inventory contracts.

Adjustments are based upon changes in the producer price index for general warehousing and storage. one adjustment is authorized annually to determine the annual management fee(s) and management cost(s) for the upcoming option year. Upward adjustments may be requested by the contractor. Downward adjustments are mandated by the clause. No adjustment is authorized for the base year.

16.203-4(d)(2)(92)

Use 52.216-9050, Economic Price Adjustment (EPA) of the Annual Inventory Holding Fee and Annual Inventory Holding Cost for the Option Year, in Medical solicitations for readiness items which result in corporate exigency contracts or vendor managed inventory contracts. Adjustments are based upon changes in the prime rate. One adjustment is authorized annually to determine the annual inventory holding fee and inventory holding cost for the upcoming option year. Upward adjustments may be requested by the contractor. Downward adjustments are mandated by the clause. No adjustment is authorized for the base year.

16.203-4(d)(2)(93)

Use 52.216-9051, Economic Price Adjustment - One Adjustment Per Year – Base Year Only FCP Percentage Adjustment when the offeror will not agree to use 52.216-9052, Economic Price Adjustment - One Adjustment Per Year – Base/Option Year Only FCP percentage adjustment and the concurrence of the C&P medical support team is received prior to using the clause.

Upward adjustments may be requested by the contractor and are limited to one per year based upon the change in the FCP. Downward adjustments are mandated whenever the FCP decreases and whenever the contractor has a federal supply schedule (FSS) for the same item and that price is reduced to one that is lower than the current unit price on medical's contract.

FCP Adjustments for the base year only are based upon the percentage change in the FCP. Adjustments for the Option Years cannot exceed the Federal Ceiling Price. Accordingly, use this clause if the offeror will not agree to use 52.216-9052, Economic Price Adjustment - One Adjustment Per Year – Base/Option Year Only FCP Percentage Adjustment. FCP adjustments for the base and option years are based upon the percentage change in the FCP.

16.203-4(d)(2)(94)

Use 52.216-9052, Economic Price Adjustment - One Adjustment Per Year – Base/Option Year Only FCP Percentage Adjustment, in Medical FAR Part 12 solicitations and contracts for yellow fever vaccine and other appropriate pharmaceutical items which have an annual Federal Ceiling Price (FCP) as required by the Veterans Healthcare Act, the contracting officer determines that an EPA is appropriate, adjustments based upon changes in the FCP, and in some instances decreases in the contractor's Federal Supply Schedule (FSS) price for the same item, are suitable for the instant acquisition, and the concurrence of the C&P medical support team is received prior to using the clause.

Upward adjustments may be requested by the contractor and are limited to one per year based upon the change in the FCP. Downward adjustments are mandated whenever the FCP decreases and whenever the contractor has a FSS for the same item and that price is reduced to one that is lower than the current unit price on medical's contract.

FCP adjustments for the Base and Option Years are based upon the percentage change in the FCP. If the offeror does not agree to base option year adjustments on the percentage change in the FCP, consider using clause 52.216-9051, Economic Price Adjustment - One Adjustment Per Year – Base Year Only FCP Percentage Adjustment.

16.203-4(d)(2)(95) EPA – actual material costs for subsistence delivered price business model.

Insert the clause at 52.216-9064, Economic Price Adjustment (EPA) – Actual Material Costs for Subsistence Delivered Price Business Model, in the solicitation and resultant contract for subsistence acquisitions that utilize “the delivered price business model” to protect the contractor and the Government against unpredictable increases and decreases in actual material costs charged by the contractor’s suppliers. This EPA clause is applicable to CONUS subsistence prime vendor (SPV) procurements. The contracting officer shall insert the applicable ceiling clause in paragraph (d) as determined by the chief of the contracting office or designee. Explicit approval must be obtained for any ceiling exceeding ten (10) percent in accordance with 16.203-3(94). The buyer will fill-in required in paragraphs (c)(1)(iii); (c)(1)(v);(c)(1)(vi); and (d). The buyer shall coordinate with the DLA Troop Support pricing office before completion of fill-in-the-blank information sections of the clause to ensure the accuracy of the information filled in. The price/cost analyst at DLA Troop Support will also review pricing information included in the statement of work for adequacy/accuracy. Additionally, for acquisitions that require review and approval by the DLA HQ IARB, these fill-in paragraphs and statement of work sections will be reviewed for adequacy/accuracy by the DLA HQ price/cost analyst in coordination with General Counsel.

16.203-4(d)(2)(96) EPA – actual material costs for subsistence product price business model.

16.203-4-90 Additional clauses.

These clauses can be used only when the requirements of FAR 16.203-2 and DLAD 16.203 are met and the determination required by FAR 16.203-3 is made, and the contracting officer determines that none of the standard FAR EPA clauses are appropriate for use in the acquisition.

16.205-4 Contract clauses.

Contracting officers may use clause 52.216-9038, Price Redetermination- Prospective (Deviation), in contracts that meet the criteria in FAR 16.205 for fixed price prospective price redetermination, are determined not suitable for economic price adjustment, and have pricing based on the date supplies are ordered rather than on date of delivery.

SUBPART 16.5 – INDEFINITE-DELIVERY CONTRACTS

16.501-2 General.

16.503 Requirements contracts.

16.504 Indefinite-quantity contracts.

16.504-90

The clause at 52.216-9027, Evaluation of Quantity Sensitive and Indefinite Delivery Contracts (IDCs), shall be used in solicitations which will result in IDC contracts when it is anticipated that the contractor will offer a price break for high quantity delivery orders. Coordinate with the demand planner manager for establishment of the quantity most likely to be procured for each delivery order. The highest weight should then be assigned to this quantity. The SF 36 shall be manually typed in the buying section to show the range of order quantities and to reflect the evaluation weight which will be placed upon the specific quantity range. The buyer shall also provide the contractor with an estimate of the annual requirements.

(a) “Awarded to a single source” means the award of any task or delivery order contract where task or delivery orders will not be competed between contract holders. “Task or delivery order contract” does not include orders against task or delivery order contracts.

(b) Award of task or delivery order contracts between $10 million and $103 million (including all options) (see FAR 1.108(c) for guidance in calculating the contract value) to a single source requires supply chain Head of the Contracting Activity (HCA) approval (unless delegated to the chief of the contracting office (CCO)), or CCO (hereafter referred to as “or equivalent”) approval for those DLA organizations for which the, Director, DLA Acquisition (J7) is the HCA. DLA Energy’s energy program contracts, AbilityOne, and FPI contracts when it is determined to be a mandatory source in accordance with FAR 8.602(a)(3), are not subject to this requirement; however, DLA Energy non-energy task and delivery order contracts are subject to this requirement.

(c) The required written determination to make a single award of a task or delivery order contract over $103 million (including all options) shall be signed by the Director, DLA Acquisition (J7), who has delegated Head of Agency authority. Contracting activities will send a draft determination to J72 that shall be accompanied by a memorandum from the supply chain HCA or equivalent that provides sufficient detail to justify why the multiple award approach was found to be unsuitable and fully supports the determination and findings required by FAR 16.504(c)(1)(ii)(D)(1). See PGI 16.504(c)(1)(ii)(D)(1)(90) for further guidance, procedures, and templates. Submit requests in ample time for HQ review and signature, preferably within the early stages of the acquisition process, but no less than 21 days before contract award.

(d) Copy of the determination. J71 will provide a copy of determinations signed by the Director, DLA Acquisition (J7), to the Deputy Director, Defense Procurement (Contract Policy and International Contracting).

16.505 Ordering.

16.506 Solicitation provisions and contract clauses.

16.506(f)(90)

Use 52.216-9017, Single or Multiple Awards, on Solicitations and Contracts for single or multiple awards of indefinite quantity contracts when the Government reserves the right to award multiple task/delivery order contracts for the same or similar services or supplies to two or more sources under this solicitation. One or more awards may be conditioned on the approval of an alternate offer. Use with 52.216-27.

16.506(91)

16.506(92)(a)

The contracting officer may use the provision at 52.216-9013, Evaluation of Offers for Indefinite Delivery Type Solicitations, to indicate to offerors how prices for quantity increments will be evaluated in solicitations for indefinite delivery contracts. If (c) (5) is selected, use when transportation costs will be evaluated and do not use FAR 52.247-50, No Evaluation of Transportation Costs. Use ALT I when not using the specified weights, but rather assigning the greatest weight to the quantity increment most likely to be procured for each delivery order.

16.506-93

16.506-94

Insert provision at 52.216-9019, Area Requirements – East and West of Mississippi, in C&E solicitations for IDCs/IQCs specifying f.o.b. destination only, covering items of supply (NSN) which are divided into requirements for delivery east and west of the Mississippi River, within the continental United States, excluding Alaska, and the procurement is not partially set aside. The clause requires the use of odd numbered items (i.e., 0001, 0003, 0005, etc.) for requirements scheduled for delivery east of the Mississippi River and even numbered items (i.e., 0002, 0004, 0006, etc.) for requirements scheduled for delivery west of the Mississippi River.

16.506-95

Use a clause substantially the same as 52.216-9020, Prime Vendor Requirements, in medical pharmaceutical prime vendor solicitations and contracts when an indefinite delivery modified requirements contract is contemplated. 52.216-9020 is to be used only for acquisitions in the medical supply chain.

16.506(96)

Use 52.216-9025, Invoices for Delivery Orders, in delivery orders against Federal Supply Schedules assigned to DLA Aviation for administration.

16.506(96)(b)

Use 52.216-9026, Pricing of Delivery Orders with Quantity Increments, in solicitations and awards for long term contracts which provide for shipment to more than one location and include quantity range pricing. Use when transportation costs will be relatively small compared to the cost of the item or when the contract price will be f.o.b. origin.

SUBPART 16.6 – TIME-AND-MATERIALS, LABOR-HOUR, AND LETTER CONTRACTS

16.601 Time and materials contracts.

16.601(90)

Supply chains shall annually monitor their percentage of acquisition dollars being spent on T&M/LH contracts and orders. At the earliest opportunity, particularly when a service contracting requirement becomes repetitive and more predictable in nature, contracting officers should migrate T&M/LH vehicles to other contract types, preferably a fixed price arrangement, if possible. Of particular focus should be the use of T&M/LH contracts and orders for professional, administrative, management support, information technology, and communication services. HCAs and, for activities for which the Director, DLA Acquisition (J7) is the HCA, CCOs shall report to the J7 CAE at the close of the calendar year any percentages of T&M/LH contract action dollars for the preceding fiscal year exceeding 8 percent of service dollars, including a discussion of the supply chain’s strategy to decrease the use of T&M/LH contract type and the risk mitigation measures being used in administering these contract types.

16.603 Letter contracts.

16.603-3 Limitations.

16.603-90 Procedures.

The policy and procedures of 17.74 and PGI 17.7404-3 are applicable to letter contracts.

SUBPART 16.7 – AGREEMENTS

16.703 Basic ordering agreements.

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