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D.C. Municipal Regulations (Last Updated: September 13, 2017) |
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Title 27. CONTRACTS AND PROCUREMENT |
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Chapter 27-24. TYPES OF CONTRACTS |
Section 27-2403. FIXED-PRICE CONTRACTS WITH ECONOMIC PRICE ADJUSTMENTS
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2403.1The contracting officer shall not use a fixed-price contract with economic price adjustment unless the contracting officer determines that it is necessary to protect the contractor and the District against significant fluctuations in labor or material costs, or to provide for contract price adjustment in the event of changes in the contractor's established prices.
2403.2A fixed-price contract with economic price adjustment shall provide for upward and downward revision of the stated contract price upon the occurrence of certain contingencies that are specifically defined in the contract.
2403.3An economic price adjustment may be one (1) of the following general types:
(a)Adjustment based on increases or decreases from an agreed-upon level in published or otherwise established prices of specific items or the contract end items;
(b)Adjustment based on increases or decreases in specified costs of labor or material that the contractor actually experiences during contract performance; or
(c)Adjustment based on increases or decreases in labor or material cost standards or indexes that are specifically identified in the contract.
2403.4For use of economic price adjustments in procurements by competitive sealed bids, the contracting officer shall follow the procedures set forth in §1542 of chapter 15 of this title.
2403.5The contracting officer may use a fixed-price contract with economic price adjustment when the following factors are applicable:
(a)There is serious doubt concerning the stability of market or labor conditions that will exist during an extended period of contract performance; and
(b)Contingencies that would otherwise be included in the contract price can be identified and covered separately in the contract.
2403.6Price adjustments based on established catalog prices shall be restricted to industry-wide contingencies. Industry-wide contingencies shall be those affecting a particular industry as a whole, and shall not depend upon circumstances within the contractor's control.
2403.7Price adjustments based on labor and material costs shall be limited to contingencies beyond the contractor's control.
2403.8When establishing the base level from which adjustment will be made, the contracting officer shall ensure that contingency allowances are not duplicated by inclusion in both the base price and the adjustment requested by the contractor under the economic price adjustment clause approved by the Director.
2403.9In contracts that do not require submission of cost or pricing data, the contracting officer shall obtain adequate information to establish the base level from which adjustment will be made and may require verification of data submitted.