DFARS DCN 20101124

SUMMARY: Limitations on certain types of line items and contract options in contracts initially awarded pursuant to competitive solicitations.

DCN 20101124 adopts as final, with a minor change, an interim ruleamending the DFARS to implement section 819 of the National Defense Authorization Act for Fiscal Year 2010. Section 819 places limitations on certain types of line items and contract options that may be included in contracts initially awarded pursuant to competitive solicitations.

Background

DoD published an interim rule in the Federal Register at 75 FR 32638 on 8 June 2010, to implement section 819 of the National Defense Authorization Act for Fiscal Year 2010. The interim rule added coverage at DFARS 217.202 and 234.005-1. The intent of the statute is to prevent a contract for new technology that is initially awarded as a result of competition, from becoming a non-competitive effort for the development of advance components or the procurement of prototype units. The DFARSimplementation places specific limits, in accordance with the statute, on the dollar value, period of performance, and time for exercise of contract line items or contract options for such contracts.

The comment period closed on 9 August 2010. A single comment was received in response to the interim rule. The respondent commented that including the change in DFARS part 234 will result in users following this requirement only when procuring major systems. This issue was raised during the preparation of the interim rule. DoD confirmed that part 234 is the optimal location, but has added to DFARS part 235, Research and Development Contracting, a second cross-reference to the part 234 coverage.

The Effective Date is 24 November 2010.

______________________________________________________________________

Click here to read the entire Federal Register notice for this rule.