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Path: Consulting Services arrow Report & Digest arrow GCA Report Articles arrow GCA Report 2005 arrow No Interest Due on Funds Not Advanced for Wages

No Interest Due on Funds Not Advanced for Wages

SCCC’s contract called for increases in contract price to incorporate changes to increased wage determinations.  Earlier, the Board decided that SCCC was entitled to a price adjustment due to the wage determinations where it was awarded increased wages, taxes, profit and Contract Disputes Act interest.  Subsequently, the Board decided on another case – Richlin – where the contractor could not receive CDA interest on wages owed to its employees because the contractor had not advanced its own funds to pay the increased wages and based on that decision ruled that SCCC would not be entitled to the interest.  Though SCCC put forth cases indicating the Board was prevented from altering its earlier decision the Board alluded to Raytheon that ruled the CDA does not permit a contractor to recover money it has not spent.  To pay them interest on funds not expended would result in an inappropriate windfall to SCCC (Schleicher Community Corrections Center Inc. v US, DOTBCA No. 3067).

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