New FAC Issued: New DOD Rule on Undefinitized Contract Actions
New DOD Rule on Undefinitized Contract Actions
The Defense Department recently issued final rules affecting undefinitized contract actions (UCAs). The new UCA rules implement the FY 2008 defense authorization act where DFAR Part 217.7404-4 states that when determining the appropriate amount of funds to be obligated on UCAs the CO will limit it to meet the contractor’s requirements for the undefinitied period. Also for profit determinations under UCAs, if substantial amount of work is completed the profit negotiated should reflect the reduced cost risk to the contractor for costs incurred during contract performance (Fed. Reg. 37649).
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