Section 27-3201. USES OF CONTRACTING FINANCING

 

3201.1Contract financing by the District shall be used only for financing contractor working capital, and shall not be used for the expansion of contractor-owned facilities.

 

3201.2Except for contracts under which facilities are being procured for District ownership, contract financing by the District shall not be used for the procurement of fixed assets.

 

3201.3Contract financing in the form of advance payments may be used by a contracting officer to assist a contractor that is a certified minority business enterprise.

 

3201.4Contract financing in the form of progress payments may be used by a contracting officer to assist a contractor when private financing for a contract is either unavailable or insufficient.

 

3201.5The customary progress payment rate shall be ninety percent (90%) applicable to the total costs of performing the contract. The contracting officer may authorize a customary rate of ninety-five percent (95%) for a certified minority business.

 

3201.6Any rate higher than the rates authorized under §3201.5 shall be considered an unusual progress payment rate. The contracting officer shall only authorize progress payments at an unusual rate if both of the following apply:

 

(a)The contract necessitates predelivery expenditures that are large in relation to the contract price and in relation to the contractor's working capital and credit; and

 

(b)The contractor fully documents the need to supplement any private financing available.

 

3201.7To encourage contractors to invest their own funds in performance despite the susceptibility of the contract to termination for the convenience of the District, the contract financing methods set forth in this section may be applied to the financing of terminations either in connection with, or independently of, financing for contract performance.

 

source

Final Rulemaking published at 35 DCR 1625 (February 26, 1988).