36.208
Concurrent performance of firm-fixed-price and other types of construction contracts
Concurrent use of cost-reimbursement and firm-fixed-price construction contracts at the same site is prohibited unless the head of the contracting activity grants prior approval.
Overview
FAR 36.208 addresses the concurrent use of different types of construction contracts at the same work site. Specifically, it restricts the simultaneous performance of cost-reimbursement or price-incentive contracts (such as cost-plus-fixed-fee) alongside firm-fixed-price, lump sum, or unit price contracts at the same location. This restriction is intended to prevent labor and administrative complications that can arise from managing multiple contract types with differing cost structures and oversight requirements. However, exceptions can be made if the head of the contracting activity grants prior approval.
Key Rules
- Restriction on Concurrent Contracts
- Cost-plus-fixed-fee, price-incentive, or other cost-adjustable contracts cannot be performed at the same site concurrently with firm-fixed-price, lump sum, or unit price contracts without special approval.
- Approval Requirement
- The head of the contracting activity must provide prior approval for any exception to this rule.
Responsibilities
- Contracting Officers: Must ensure that different contract types are not performed concurrently at the same site unless prior approval is obtained.
- Contractors: Should be aware of contract type restrictions and seek clarification or approval if multiple contract types are proposed at the same site.
- Agencies: The head of the contracting activity is responsible for reviewing and approving any exceptions.
Practical Implications
- This regulation exists to avoid confusion, disputes, and inefficiencies that can result from managing multiple contract types with different cost and performance incentives at a single work site.
- Contractors and contracting officers must plan contract awards and site management carefully to avoid noncompliance.
- Failure to obtain proper approval for concurrent contracts can result in administrative issues or contract disputes.