NOAA Acquisition Manual

Main Table of Contents

Subchapter C- Contracting Methods and Contract Types

Part 1330-17 Special Contracting Methods

Subpart 1330-17.2 Options

1330-17.202 Use of Options

1330-17.203 Solicitations

1330-17.204 Contracts

1330-17.205 Documentation

1330-17.206 Evaluation

1330-17.207 Exercise of Options

Subpart 1330-17.5 Interagency Acquisitions

1330-17.502 Procedures

1330-17.502-2 The Economy Act



Part 1330-17 Special Contracting Methods

Subpart 1330-17.2 Options

1330-17.202 Use of Options

(a) Pursuant to the policy established by AA 18-04, NOAA Use of Clause 52.217-8 Option to Extend Services, the contracting officer shall insert FAR Clause 52.217-8 in all solicitations, contracts, and orders for severable services and complete the fill-in.  

1330-17.203 Solicitations

(a)  Pursuant to 1330-17.202(a), all solicitations and resultant contracts and orders for severable services shall include FAR clause 52.217-8, Option to Extend Services.

(b)  When the inclusion of FAR clause 52.217-8 is required by 1330-17.202(a), the contracting officer shall:

  1. Modify FAR 52.212-2 Evaluation – Commercial Items, FAR 52.217-4, Evaluation of Options Exercised at Time of Contract Award, or FAR 52.217-5 Evaluation of Options, as applicable, to include the following statement:

    “Except when it is determined in accordance with FAR 17.206(b) not to be in the Government’s best interests, the Government will evaluate offers or quotations for award purposes by adding the total price for all options to the total price for the basic requirement to determine the total evaluated price. This includes options under FAR clause 52.217-8, Option to Extend Services, which applies to this solicitation. Evaluation of options will not obligate the Government to exercise the option(s).

  2. Include the following statement in all solicitations and resultant contracts and orders:

    “Inclusion of FAR clause 52.217-8, Option to Extend Services, in the solicitation and resultant contract is for use by the Government as outlined at FAR 37.111, Extension of Services. The option will be exercised as needed at any time during the life of the contract using the rates applicable at the time of exercise.”

1330-17.204 Contracts

(a) Include the language at 1330-17.203(b) in all contracts and orders for severable services.

1330-17.205 Documentation

(a)  Contracting staff shall utilize the AGO template entitled, Justification for Inclusion of Option(s), to complete a justification for inclusion of options, unless a waiver to the required template has been granted by the NOAA SBPO.  A request for waiver to the required AGO template shall include supporting details using the AGO Transmittal Memorandum Template and be sent through the AGO POD as an SBPO Review.

1330-17.206 Evaluation

(a) The contracting officer shall ensure the award decision document demonstrates how pricing for the option period(s), including the option at FAR clause 52.217-8, was evaluated in accordance with the solicitation, and that the final prices were determined fair and reasonable.

For example:

“Pricing for the base and each option period was provided by each offeror in response to the solicitation. Each offeror’s proposed option period rates were compared to their base period rates to determine whether or not the option period rates were reasonable. Findings from this comparison are shown below. Option pricing for any potential extension under FAR clause 52.217-8 was evaluated by calculating the average price of the base period and all option periods and adding half of that amount to the sum of the prices of the base and all option periods.”

An example of the above method for evaluating a possible extension under FAR clause 52.217-8 is: Total price base + all option periods = $1,000,000.  Average price of total period of performance = $1,000,000/5 or $200,000.  Half of $200,000 = $100,000. Total evaluated price = $1,100,000.

1330-17.207 Exercise of Options


(c)(1) Funding contract option periods. See 1330-32.703-170(a)(2) for additional policy on funding contract option periods.

(f) Contracting staff shall utilize the AGO template entitled, Determination and Findings for Exercise of Option, when completing a determination to exercise an option, unless a waiver to the required template has been approved by the NOAA SBPO. A request for waiver to the required AGO template shall be completed utilizing the AGO Transmittal Memorandum Template and be submitted through the AGO POD as an SBPO review.


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Subpart 1330-17.5 Interagency Acquisitions

1330-17.502 Procedures

All NOAA Interagency Agreements shall be treated consistent with and shall adhere to the policies set forth in CAM 1317.570, Department of Commerce Interagency Agreements.

1330-17.502-2 The Economy Act

(c)(1) The program office shall do the following:-

  1. Prepare a memorandum addressed to “NOAA Contracting Officer” from the program manager providing the information required to support the attached D&F entitled, Economy Act Determination and Findings by responding to the following:
    1. Explain the need for the supplies or services,
    2. Describe why it is in the best interest of NOAA to partner with this Federal agency (i.e., identify the essential capabilities or expertise the Federal agency receiving the funds possesses that NOAA does not possess),
    3. Explain why the supplies or services cannot be obtained as conveniently or economically by contracting directly with a private source. A business case must be made that this action is in the best interest of NOAA, and
    4. If the Economy Act Order requires contract action by the Federal agency receiving the funds from NOAA, include a statement explaining why at least one of the following circumstances applies:
      1. The acquisition will be made under an existing contract of the Federal agency, entered into before placement of the order. Provide contract number and vendor,
      2. The Federal agency has the capabilities or expertise to enter into a contract for such supplies or services that are not available within NOAA, or
      3. The Federal agency is specifically authorized by law or regulation to purchase such supplies or services on behalf of other Federal agencies.
  2. Provide a signed statement that the funds are currently available for the supplies or services, which will include the accounting code information.
  3. Attach a copy of the following documents to the D&F before submission:
    1. D&F supporting documentation (memorandum to contracting officer),
    2. Interagency Agreement, and
    3. OGC CLD review and concurrence.

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(c)(2) The contracting officer shall:
  1. Ensure that a D&F is completed for any Interagency Agreement transferring funding that will result in a contract being signed by a federal contracting officer. If the Interagency Agreement transfers funding that will not result in a contract being signed, a D&F is not required to be signed by a contracting officer;
  2. Review the Interagency Agreement and supporting D&F documentation;
  3. Complete and sign the D&F, if appropriate;
  4. Return the Interagency Agreement and signed D&F to the program office;
  5. Request that the Line Office provide a copy of the OGC CLD’s clearance memorandum for the contract file;
  6. Notify the program office and coordinate submission of a procurement request, if the contracting officer determines that it is not in the best interest for NOAA to enter into the Interagency Agreement to contract for such supplies or services; and
  7. Provide a copy of the approved D&F for assisted acquisitions to the SBPO immediately after the contracting officer’s approval.

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