41.501 Solicitation provision and contract clauses
Source: FAR 41.501 on acquisition.gov
FAR 41.501 requires contracting officers to include and, when necessary, tailor specific solicitation provisions and contract clauses for utility service contracts to ensure compliance and address unique contracting situations.
Overview
FAR 41.501 outlines the requirements for including specific solicitation provisions and contract clauses in government contracts for utility services. Recognizing that utility service terms can vary by region and supplier, this section allows contracting officers to tailor provisions and clauses to fit the unique circumstances of each utility contract, provided they remain substantially the same as the prescribed FAR language. The section mandates the use of certain clauses and provisions—such as those addressing electric service territory compliance, order of precedence, contract scope and duration, changes in service, contractor facilities, and service provisions—in all utility service solicitations and contracts. Additional clauses are required under specific conditions, such as regulated or unregulated services, connection charges, termination liabilities, multiple service locations, nonrefundable charges, and capital credits. Contracting officers must also include any other relevant FAR provisions and clauses as appropriate for the acquisition.
Key Rules
- Tailoring of Provisions and Clauses
- Contracting officers may adapt prescribed provisions and clauses to fit specific utility contracting situations, as long as they remain substantially the same as the FAR templates.
- Mandatory Clauses for Utility Services
- Specific clauses (e.g., 52.241-2 through 52.241-6) must be included in all utility service solicitations and contracts.
- Conditional Clauses
- Additional clauses (e.g., 52.241-7 through 52.241-13) are required based on the nature of the utility service, such as regulation status, connection charges, or service locations.
- Inclusion of Other FAR Clauses
- Contracting officers must also include any other applicable FAR provisions and clauses relevant to the acquisition.
Responsibilities
- Contracting Officers: Must determine which clauses apply, tailor them as needed, and ensure all required provisions are included in solicitations and contracts for utility services.
- Contractors: Must comply with all included provisions and clauses, including those specific to their utility service arrangement.
- Agencies: Oversee compliance with FAR requirements and ensure contracting officers follow proper procedures.
Practical Implications
- This section ensures that utility service contracts are comprehensive and tailored to the specific regulatory and operational environment of each acquisition.
- Failure to include required clauses can result in noncompliance, contract disputes, or unenforceable terms.
- Contracting officers must be diligent in assessing the unique aspects of each utility contract and applying the correct clauses, including any agency-specific adaptations.
(a) Because the terms and conditions under which utility suppliers furnish service may vary from area to area, the differences may influence the terms and conditions appropriate to a particular utility’s contracting situation. To accommodate requirements that are peculiar to the contracting situation, this section prescribes provisions and clauses on a "substantially the same as" basis (see 52.101) which permits the contracting officer to prepare and utilize variations of the prescribed provision and clauses in accordance with agency procedures.
(b) The contracting officer shall insert in solicitations for utility services a provision substantially the same as the provision at 52.241-1, Electric Service Territory Compliance Representation, when proposals from alternative electric suppliers are sought.
(c) The contracting officer shall insert in solicitations and contracts for utility services clauses substantially the same as the clauses at-
(1) 52.241-2, Order of Precedence-Utilities;
(2) 52.241-3, Scope and Duration of Contract;
(3) 52.241-4, Change in Class of Service;
(4) 52.241-5, Contractor’s Facilities; and
(5) 52.241-6, Service Provisions.
(d) The contracting officer shall insert clauses substantially the same as the clauses listed below in solicitations and contracts under the prescribed conditions-
(1) 52.241-7, Change in Rates or Terms and Conditions of Service for Regulated Services, when the utility services are subject to a regulatory body. (Except for GSA areawide contracts, the contracting officer shall insert in the blank space provided in the clause the name of the contracting officer. For GSA areawide contracts, the contracting officer shall insert the following: "GSA and each areawide customer with annual billings that exceed $250,000").
(2) 52.241-8, Change in Rates or Terms and Conditions of Service for Unregulated Services, when the utility services are not subject to a regulatory body.
(3) 52.241-9, Connection Charge, when a refundable connection charge is required to be paid by the Government to compensate the contractor for furnishing additional facilities necessary to supply service. (Use AlternateI to the clause if a nonrefundable charge is to be paid. When conditions require the incorporation of a nonrecurring, nonrefundable service charge or a termination liability, see paragraphs (d)(6) and (d)(4) of this section).
(4) 52.241-10, Termination Liability, when payment is to be made to the contractor upon termination of service in conjunction with or in lieu of a connection charge upon completion of the facilities.
(5) 52.241-11, Multiple Service Locations (as defined in 41.101), when providing for possible alternative service locations, except under areawide contracts, is required.
(6) 52.241-12, Nonrefundable, Nonrecurring Service Charge, when the Government is required to pay a nonrefundable, nonrecurring membership fee, a charge for initiation of service, or a contribution for the cost of facilities construction. The Government may provide for inclusion of such agreed amount or fee as a part of the connection charge, a part of the initial payment for services, or as periodic payments to fulfill the Government’s obligation.
(7) 52.241-13, Capital Credits, when the Federal Government is a member of a cooperative and is entitled to capital credits, consistent with the bylaws and governing documents of the cooperative.
(e) Depending on the conditions that are appropriate for each acquisition, the contracting officer shall also insert in solicitations and contracts for utility services the provisions and clauses prescribed elsewhere in the FAR.