Section 137.336 - What is the difference between fixed-price and cost-reimbursement agreements?(a) Cost-reimbursement agreements generally have one or more of the following characteristics:(1) Risk is shared between IHS and the Self-Governance Tribe;(2) Self-Governance Tribes are not required to perform beyond the amount of funds provided under the agreement;(3) Self-Governance Tribes establish budgets based upon the actual costs of the project and are not allowed to include profit;(4) Budgets are stated using broad categories, such as planning, design, construction project administration, and contingency;(5) The agreement funding amount is stated as a "not to exceed" amount;(6) Self-Governance Tribes provide notice to the IHS if they expect to exceed the amount of the agreement and require more funds;(7) Excess funds remaining at the end of the project are considered savings; and(8) Actual costs are subject to applicable OMB circulars and cost principles.(b) Fixed Price agreements generally have one or more of the following characteristics:(1) Self-Governance Tribes assume the risk for performance;(2) Self-Governance Tribes are entitled to make a reasonable profit;(3) Budgets may be stated as lump sums, unit cost pricing, or a combination thereof;(4) For unit cost pricing, savings may occur if actual quantity is less than estimated; and,(5) Excess funds remaining at the end of a lump sum fixed price project are considered profit, unless, at the option of the Self-Governance Tribe, such amounts are reclassified in whole or in part as savings.