Subpart 16.1
Selecting Contract Types
Selecting the right contract type is essential to balance risk, cost, and performance in government acquisitions, and must be based on thorough analysis and documentation.
Overview
FAR Subpart 16.1, "Selecting Contract Types," provides the foundational guidance for government contracting professionals on how to choose the most appropriate contract type for a given procurement. This subpart outlines the general principles, policies, negotiation considerations, and factors that must be evaluated when determining contract type. It also references the required solicitation provisions to ensure transparency and compliance. The subpart is structured to help contracting officers balance risk, cost, and performance incentives, ensuring that the government's interests are protected while fostering fair and reasonable contractor relationships.
Key Rules
- General Principles (16.101)
- Establishes the importance of selecting a contract type that best fits the acquisition situation and government objectives.
- Policies (16.102)
- Sets forth policies for contract type selection, emphasizing sound business judgment and risk assessment.
- Negotiating Contract Type (16.103)
- Requires negotiation of contract type as part of the overall contract negotiation process, considering price, risk, and performance.
- Factors in Selecting Contract Types (16.104)
- Lists key factors such as price competition, cost analysis, performance risk, and administrative effort that must be evaluated.
- Solicitation Provision (16.105)
- Mandates inclusion of specific provisions in solicitations to inform offerors of the intended contract type.
Responsibilities
- Contracting Officers: Must assess acquisition needs, evaluate risks, negotiate contract type, and include required solicitation provisions.
- Contractors: Should understand the implications of different contract types and respond accordingly in proposals.
- Agencies: Oversee compliance with FAR policies and ensure proper documentation of contract type decisions.
Practical Implications
- This subpart exists to ensure contract types are selected based on sound analysis, not convenience or habit.
- It impacts daily contracting by requiring thorough documentation and justification for contract type choices.
- Common pitfalls include inadequate risk assessment, failure to document rationale, or improper solicitation provisions.