Section 27-3215. PROGRESS PAYMENTS BASED ON COSTS

 

3215.1For the purpose of making progress payments and determining the limitations on progress payments, the contract price shall be as follows:

 

(a)Under firm-fixed-price contracts, the contract price shall be the current contract price plus any unpriced modifications for which funds have been obligated;

 

(b)If the contract is redeterminable or subject to economic price adjustment, the contract price shall be the initial price until modified;

 

(c)Under a fixed-price incentive contract, the contract price shall be the target price plus any unpriced modifications for which funds have been obligated. However, if the contractor's properly incurred costs exceed the target price, the contracting officer may provisionally increase the price up to the ceiling or maximum price; and

 

(d)Under a letter contract, the contract price shall be fifty percent (50%) of the maximum amount of the definitive contract.

 

3215.2For the purpose of making progress payments and determining the limitation on progress payments, any portion of the contract specifically providing for reimbursement of costs only shall be excluded from the contract price.

 

3215.3The contracting officer shall not make progress payments or increase the contract price beyond the funds obligated under the contract, as amended.

 

3215.4Bids conditioned on progress payments when the solicitation does not provide for progress payments shall be rejected as nonresponsive.

 

3215.5A contracting officer may provide for customary progress payments if the contractor will not be able to bill for delivery of products (or other performance milestones) for a substantial time (not less than four (4) months) after work must begin and, during the predelivery period, will make expenditures for contract performance that have a significant impact on the contractor's working capital.

 

3215.6The contracting officer shall not provide for progress payments on contracts of less than one hundred thousand dollars ($100,000), except in cases where a certified minority contractor is performing multiple contracts which total more than one hundred thousand dollars ($100,000).

 

3215.7A contracting officer shall not provide for progress payments if the contract items are quick turnover types for which progress payments are not a customary commercial practice, such as the following:

 

(a)Subsistence;

 

(b)Clothing;

 

(c)Medical and dental supplies; or

 

(d)Standard commercial items not requiring a substantial accumulation of predelivery expenditures by the contractor.

 

source

Final Rulemaking published at 35 DCR 1630 (February 26, 1988).