17.206 Evaluation
Source: FAR 17.206 on acquisition.gov
Contracting officers must evaluate option quantities in solicitations unless a justified, higher-level-approved determination is made not to do so.
Overview
FAR 17.206 outlines the requirements for evaluating option quantities or periods in solicitations when awarding a basic contract. The regulation ensures that, when the Government is likely to exercise contract options, these options are considered during the evaluation of offers. However, it also provides flexibility for contracting officers to exclude option evaluation if it is not in the Government's best interest, provided this decision is justified and approved at a higher level. This section aims to promote transparency and value in contract awards while allowing for practical exceptions when funding or other circumstances make option evaluation unnecessary.
Key Rules
- Mandatory Evaluation of Options
- Contracting officers must evaluate offers for option quantities or periods if it is likely the Government will exercise those options.
- Exception to Evaluation Requirement
- Option evaluation may be omitted if it is determined not to be in the Government's best interest, with higher-level approval and proper justification (e.g., likely lack of funding).
Responsibilities
- Contracting Officers: Must determine the likelihood of exercising options, evaluate options when required, and seek higher-level approval if opting not to evaluate.
- Contractors: Should prepare offers with the understanding that options may be evaluated and impact award decisions.
- Agencies: Must provide oversight and approve determinations not to evaluate options when appropriate.
Practical Implications
- This section ensures fair and comprehensive evaluation of offers, including options, to maximize value for the Government.
- Contractors should price options competitively, knowing they may affect award outcomes.
- Failure to properly evaluate options or obtain required approvals for exceptions can lead to compliance issues or protest risk.
(a) In awarding the basic contract, the contracting officer shall, except as provided in paragraph (b) of this section, evaluate offers for any option quantities or periods contained in a solicitation when it has been determined prior to soliciting offers that the Government is likely to exercise the options. (See 17.208.)
(b) The contracting officer need not evaluate offers for any option quantities when it is determined that evaluation would not be in the best interests of the Government and this determination is approved at a level above the contracting officer. An example of a circumstance that may support a determination not to evaluate offers for option quantities is when there is a reasonable certainty that funds will be unavailable to permit exercise of the option.