DoD eyes changing fixed-price regs

The Defense Department is considering amending changes to Defense Federal Acquisition Regulation Supplement (DFARS) acquisition regulations and designed to establish a preference for fixed-price contracts, according to an April 1 Federal Register notice. The proposed changes would implement a section of the National Defense Authorization Act for FY 2017 that requires a preference in the use of fixed-price contracts to determine contract types. It would also require review and approval for certain cost-reimbursement contracts, from the office of the under secretary of defense for acquisition and sustainment, at specified thresholds and timelines. It would also require the use of firm fixed-price contracts for foreign military sales “unless an exception or waiver applies," the notice states. Risk levels associated with a program is a major factor and consideration point for choosing the contract type. "Since development efforts are inherently risky and do not lend themselves to a fixed‐price type of contract, a cost‐reimbursement contract is more appropriate and customary." (Source: Inside Defense 04/01/19)