(ii) Step Two: Develop the CLINs
What drives your CLIN structure is your frame of reference. How do you view what you are buying? What is the most useful frame of reference to establish for those who will submit proposals and those who will later administer the contract? Since this is a multi-year contract, production requirements of the second and subsequent program years must not be option CLINs. The Government is committing to buy those production quantities at the outset.
(A) You basically have three alternatives. You can group what you are buying by:
(1) Funding Year. (See EXAMPLE #1).
(i) All Advance Procurement being initiated and funded in FY XX is carried under the same FY XX CLIN.
(ii) Production of FY XX end items, which are fully funded in FY XX, is also carried under the FY XX CLIN.
(2) FY Requirements. (See EXAMPLE #2).
(i) All Advance Procurement effort contributing to production of FY XX end items is carried under the FY XX Production CLIN.
(ii) FY XX Production is also a SubCLIN under the FY XX Production CLIN.
(3) What is Being Bought. (See EXAMPLE #3).
(i) All advance procurement effort is under an advance procurement CLIN.
(ii) All production is under either one production CLIN or separate, production-only CLINs.
CONTRACT FUNDING PLAN Program XY Launch Vehicles (XYLVs) (FY97 - FY00) (Dollars in Millions) | ||||||
FY96 | FY97 | FY98 | FY99 | FY00 | TOTAL | |
QUANTITY | 18 | 18 | 18 | 16 | 70 | |
MULTI-YEAR | PROPOSAL | |||||
Gross | 1,173.5 | 1,182.5 | 1,046.7 | 896.9 | 4,299.6 | |
234.4 | 352.1 | 342.1 | 283.6 | 1,212.2 | ||
Net Request | 939.1 | 830.4 | 704.6 | 613.3 | 3,087.4 | |
For FY97 | 234.4 | 234.4 | ||||
For FY98 | 60.4 | 291.7 | 352.1 | |||
For FY99 | 41.9 | 92.5 | 207.7 | 342.1 | ||
For FY00 | 28.9 | 64.3 | 32.8 | 157.6 | 283.6 | |
365.6 | 448.5 | 240.5 | 157.6 | 0.0 | 1,212.2 | |
Total MY Cost | 365.6 | 1,378.6 | 1,070.9 | 862.2 | 613.3 | 4,299.6 |
Savings | -126.8 | -144.6 | +141.2 | +213.1 | +179.1 | +262.0 |
Figure 11.B
(B) The next few pages contain three examples of CLIN structures that could be used to accomplish the same multi-year acquisition. All three examples are based on the multi-year contract described in Figure 11.B which is summarized below:
(1) It will buy a total of 70 XYLVs during the four-year period from FY97 through FY00.
(2) The program office plans to acquire some related research and development effort under the same contract.
(3) The program office also wants to be able to buy a reprocurement data package since future requirements (in years following those covered by the multi-year contract) may be subjected to competition.
These examples show a MYC "with everything in it;" long lead advance procurement, EOQ advance procurement, and fully funded production. If your MYC does not involve long lead or EOQ or both, tailor out the CLINs and SubCLINs for those efforts, and only use the portions of the example that pertains to your MY Program.
Note: If you plan to award a Non‑EOQ multi-year contract that involves long lead advance procurement, you will have to: (1) provide for including recurring costs in the cancellation ceiling and (2) tailor the cancellation and funding clauses as described in Chapter 12. These actions and revisions will, of course, be limited to long lead and will not mention EOQ.
Notes for Following Examples #1, 2, and 3 (1) The title of all multi-year clauses and SCRs will be followed by a parenthetical applicability statement. In this example, that statement would be "Not applicable to CLINs 0001 and 0007." (2) This R&D effort is a CLIN rather than an Option CLIN because it is being initiated at award, in 1996. The reprocurement data is carried under an Option CLIN because: (a) it is not part of the production effort covered by the MYC authority; and (b) it is a potential rather than a firm requirement, as of the time of award. (3) All CLINs and SubCLINs for production of XYLVs are basic rather than Option CLINs. Given the authority to award a multi-year contract, the Government has a firm requirement for all 70 XYLVs ‑ the units associated with the second and subsequent years are not, treated as options. (4) The "Info CLIN" can be thought of as a category heading or title. All SubCLINs under the Info CLIN fit into that category. Thus, since Info CLIN 0002 is " FY 97 XYLVs," all 0002 SubCLINs feed into or are a part of the FY 97 XYLVs. No price or delivery schedule needs to be associated with the Info CLIN as a whole; instead, a price is assigned to each SubCLIN. (5) The price of each advance procurement SubCLIN establishes the amount the Government will obligate when that SubCLIN is funded. As explained in the SCR you will write entitled "Advance Procurement," the price of the advance procurement SubCLINs are part of, and not in addition to, the price of the related end item SubCLIN. For example, the price of 0002AC is the actual price of the 18 XYLVs. When SubCLIN 0002AC is funded, the Government will need to obligate the 0002AC price less the amount previously obligated for 0002AA and 0002AB. Then SubCLIN 0002AC is fully funded, and the prices of SubCLINs 0002AA and 0002AB become moot. To ensure this is understood by offerors, CLIN descriptive data must either explain it or refer to the SCR that explains it. (See paragraph B, "Develop Contract Language to Explain the Relationship between Advance Procurement CLINs and End Item CLINs.") (6) SubCLIN structure is not applicable to multiple funded CLINs (sublines). |
Figure 11.C |