Contracting Cone

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FAR Based Strategies

Federal Supply Schedules
Commercial Items
Simplified Acquisitions
Contracting by Negotiation
IDIQ
Letter Contracts
Agreements
Small Business
Broad Agency Announcement
Commercial Solutions Opening

Statutory Strategies

SBIR/STTR
Other Transactions
Procurement for Experiments
R&D Agreements
Cooperative R&D Agreement
Partnership Intermediary Agreement
Technology Investment Agreement

Contract Type Matrix

Letter Contracts (FAR 16.603)

Letter contracts, also known as Undefinitized Contract Actions (UCAs), are a mechanism to authorize a contractor to immediately begin delivering supplies or performing services before the terms and conditions of the contract can be agreed upon. This strategy is used only when negotiating a definitive contract is not possible in sufficient time to meet the requirement, and the Government’s interest demands that the contractor begin work immediately.

 

Common Applications

  • Supplies, products, or services used in support of a contingency operation or humanitarian/peacekeeping operation.

 

 

Pros

Cons
Provides opportunity to rapidly meet urgent mission requirements Undefined terms and conditions and limited ability to control cost increases risk to the Government
Letter Contract/UCA procedures reduce time to execute for an immediate authority to proceed Reporting requirements increases burden on program office and contracting activity
Initial proposals may not meet government standards resulting in prolonged negotiations increasing risk to definitization schedule
Elevated level of approvals and government oversight and increases burden on program office and contracting activity

Restrictions

  • Requires statement of urgency from requiring organization
  • May be used only after the head of the contracting activity or a designee determines in writing that no other contract is suitable
  • May not commit the government to a definitive contract in excess of the funds available at the time the letter contract is executed;
  • May not be entered into without competition when competition is required by FAR Part 6
  • May not be amended to satisfy a new requirement unless that requirement is inseparable from the existing letter contract
  • Must be definitized by 180 days or before completion of 40% of work

 

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