[Code of Federal Regulations]

[Title 48, Volume 5]

[Revised as of October 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR817.105-1]



[Page 182-183]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                CHAPTER 8--DEPARTMENT OF VETERANS AFFAIRS

 

PART 817_SPECIAL CONTRACTING METHODS--Table of Contents

 

                  Subpart 817.1_Multi-Year Contracting

 

Sec. 817.105-1  Uses.



    (a) Pursuant to Title 38, United States Code, Chapter 1, Section 114 

(as amended by Pub. L. 101-237), multiyear contracting not exceeding 5 

years is authorized for obtaining supplies and services when the 

Secretary has made the following determinations:

    (1) Appropriations are available for obligation for the total 

payments for the fiscal year the contract is entered into plus the 

estimated amount of any cancellation charges.

    (2) The contract is in the best interest of the Government due to 

the effect it would have in:

    (i) Reducing cost;

    (ii) Achieving contract administration and other efficiencies;

    (iii) Increasing quality contract performance;

    (iv) Encouraging effective competition.

    (3) During the contract period:

    (i) There is a continuing need for the supplies or services;

    (ii) There is little likelihood of substantial changes in need for 

the supplies and services in terms of quantity or rate of delivery; and

    (iii) The specifications for the supplies or services are expected 

to be reasonably stable.

    (4) The risks relating to a prospective contractor's ability to 

perform in accordance with the specifications and other contract terms 

are not excessive;

    (5) The use of a multiyear contract will not inhibit competition 

from small business firms;

    (6) In the case of a pharmaceutical item for which a patent has 

expired less than 4 years before the solicitation issue date, there is 

no substantial likelihood that increased competition will occur during 

the term of the contact that would make the contract prices higher than 

would be reasonable.

    (b) The authority of the Secretary to enter into multiyear contracts 

and to make the determinations specified in 817.102-1(a) of this section 

is delegated as follows:



[[Page 183]]



    (1) Heads of contracting activities. For contracts not requiring 

legal/technical reviews pursuant to 801.602-70 (for purposes of 

determining applicability of the thresholds, the total dollar amount of 

the contract over its full multiyear term will be used), and which do 

not contain a first year cancellation ceiling which exceeds 20 percent 

of the total dollar amount of the contract over the full multi-year 

term.

    (2) Deputy Assistant Secretary for Acquisition and Materiel 

Management, will approve all proposed uses of multiyear contracts not 

authorized for approval by heads of contracting activities. For approval 

purposes, the head of the contracting activity will justify and document 

the use of a multiyear contract against each of the criteria specified 

in 817.102-1 (a)(1) through (a)(6) of this section. The justification 

will additionally delineate the cancellation ceiling and the method used 

for calculating that ceiling and will specify the advantages of 

multiyear contracts over other alternative methods, e.g., option year 

contracts.

    (c) Cancellation ceilings will be carefully developed in accordance 

with FAR 17.106-1.



[54 FR 980, Jan. 11, 1989, as amended at 57 FR 44129, Sept. 24, 1992. 

Redesignated and amended at 63 FR 69219, Dec. 16, 1998]