10 U.S.C. § 2433 Pub. L. 116-283, div. A, title XVIII, §1850(l), Jan. 1, 2021, 134 Stat. 4271] Section, added Pub. L. 97-252, title XI, §1107(a)(1), Sept. 8, 1982, 96 Stat. 741, §139b; amended Pub. L. 98-94, title XII, §1268(1), Sept. 24, 1983, 97 Stat. 705; Pub. L. 98-525, title XII, §1242(b), Oct. 19, 1984, 98 Stat. 2607; Pub. L. 99-145, title XIII, §1303(a)(2), Nov. 8, 1985, 99 Stat. 738; renumbered §2433 and amended Pub. L. 99-433, title I, §§101(a)(5), 110(d)(14), (g)(8), Oct. 1, 1986, 100 Stat
Cost-reimbursement types of contracts provide for payment of allowable incurred costs, to the extent prescribed in the contract. These contracts establish an estimate of total cost for the purpose of obligating funds and establishing a ceiling that the contractor may not exceed (except at its own risk) without the approval of the contracting officer. 48 C.F.R. §§16.301-1
(a) The contracting officer shall use cost-reimbursement contracts only when- (1) Circumstances do not allow the agency to define its requirements sufficiently to allow for a fixed-price type contract (see 7.105); or (2) Uncertainties involved in contract performance do not permit costs to be estimated with sufficient accuracy to use any type of fixed-price contract. (b) The contracting officer shall document the rationale for selecting the contract type in the written acquisition plan and ensure
A cost-plus-award-fee contract is a cost-reimbursement contract that provides for a fee consisting of (a) a base amount (which may be zero) fixed at inception of the contract and (b) an award amount, based upon a judgmental evaluation by the Government, sufficient to provide motivation for excellence in contract performance. Cost-plus-award-fee contracts are covered in subpart 16.4, Incentive Contracts. See 16.401(e) for a more complete description and discussion of the application of these contracts