(iii) Step Three: Draft a "Multi-year Contract Funding" SCR.

Determine what else the contract needs to say about how it will be funded and draft a "multi-year contract funding" SCR.

(A) Step Three A: Identify Funds Available for Contract Performance.

The first sentence of paragraph (a) of the SCR recommended in Step One is "Funds available for performance are described in the Schedule." The actual obligations made in Section G of the contract will serve this purpose. You may emphasize this point by beginning the funding SCR as follows:

 "Funds available for performance are the funds obligated in Section G."

(B) Step Three B: Identify dates by which the Contracting Officer will notify the contractor that additional funds are available.

(1) The third sentence of paragraph (a) of the SCR recommended in Step One ("When additional funds are available for the full requirements of the next succeeding program year, the Contracting Officer shall, not later than the date specified in the Schedule (unless a later date is agreed to), so notify the Contractor in writing.") creates a need for one element of the clause you must draft. The SCR should establish dates by which the contracting officer should provide such notification. The dates should be based on anticipated receipt of appropriated funds for each "out-year" of the multi-year contract. To provide the needed dates, consider using language such as this:

For the purpose of the SCR of this contract entitled "Limitation of Price and Contractor Obligations," the Contracting Officer shall notify the Contractor in writing of the availability of funds for the full requirements of succeeding program years as follows:

Note: The dates established in this portion of the funding clause must correspond to the dates or time periods established in the cancellation clauses discussed earlier in this chapter.

(2) Since DoD Appropriations Acts are frequently enacted after the beginning of the fiscal year to which they apply, the multi-year contract may have to be continued under Continuing Resolutions pending the availability of fiscal year appropriations. Your funding clause should provide for this situation. Consider using language such as the following:

In the event that funding is not available for obligation by the specified date, then the Government may delay funding the required amount specified in paragraph (a) above for three (3) successive periods of thirty (30) days; provided that the Government so notifies the Contractor. In the event of such delay, the Government may issue a unilateral modification to the contract directing the Contractor to continue work at the not-to-exceed amount applicable to the (enter appropriate years) effort (without change to contract price) as set forth below. The parties may, by mutual agreement, extend the funding delay beyond the last thirty-day period. If the required funding is provided in the amount specified in paragraph (a) above, the adjustments to the Cancellation Ceiling as adjusted by this provision would be the limitation of the Government's liability for the canceled end items.

Once the funds become available, the Contracting Officer should issue a unilateral funding modification to the contract obligating the money for that fiscal year.

(3) The fourth sentence of paragraph (a) of the SCR recommended in Step One: "The Contracting Officer will also modify the contract to reflect the amount of funds specified in the Schedule as available for contract performance." A funding clause should be established to indicate that a modification will be issued unilaterally and within some number of days after the written notification is sent to the contractor. If the funding plan is known, it should be presented in the clause.

Note: When the solicitation is issued, the dollar and date columns may be left blank. Section L should instruct offerors to enter necessary information. When the contract is awarded, the funding plan will represent the agreement of the parties on how and when funds will be applied to the contract.