Electronic Transmittal (ET) No. 05-01
Contractor Notification of Funding Limitations under a Continuing Resolution (CR)

D-7800
ACM-1.10    

MEMORANDUM

To:     Director, PN, MP, LC, UC, GP
                 Attention: PN-3700, PN-3702, MP-820, LC-3100, LC-3103,
                  UC-440, GP-3800
               Director, Administrative Service Center
                  Attention: D-2940
               Director, Management Services
                 Attention: D-7800, D-7810

From:      Karla Smiley
                 Acquisition and Assistance Management Services  

Subject:  Electronic Transmittal (ET) No. . 05-01 - Contractor Notification of Funding Limitations under a Continuing Resolution (CR)

1. Purpose: This ET transmits guidance for use in the award and administration of contracts during the FY 2005 Continuing Resolution. It does not apply to service contracts under which performance is begun and completed during the period of the CR. Separate guidance will be issued for financial assistance and Public Law 93-638 actions.

2. Effective Date: This guidance is effective October 1, 2004.

3. Expiration Date: Upon enactment of the FY 2005 Energy and Water Development Appropriations Act. Should the Continuing Resolution be extended or a new CR enacted, this guidance will be updated by ET supplement.

4. Background:

(a) The President has signed a CR providing interim funding until enactment of FY 2005 permanent appropriations or through November 20, 2004, whichever occurs first.

(b) The CR is intended to permit contractors to continue work under contracts at particular rates of expenditure as set forth in H. J. Res. 107. (Available at http://thomas.loc.gov/.) We suggest you do not use funds made available under the CR if carryover funds from previous fiscal year appropriations are to be used in a particular instance. In this situation, it is suggested that the contractor be contacted and informed that it is not affected by the funding limitations of the CR since a different source of funds is being used.

(c) While Reclamation operates under the CR, notification must be provided to current contractors, and special provisions must be included in new contracts (including purchase orders), modifications to existing contracts which extend the contract performance period, and other contract actions which obligate only partial funding under the CR. To ensure uniform notification is given to contractors in order to inform them of their rights and responsibilities during the effective period of the CR and to allow for timely payment of invoices during this period, the guidance in this memorandum shall be followed by all contracting offices.

5. Explanation of Changes:

(a) The attached clauses entitled "Limitation of Government's Obligation," have been developed to formally provide notification of the CR. (See Attachments 1 and 2.) Also attached is a copy of a letter which can be used to notify a contractor of restricted funding under the CR. (See Attachment 3.)

(b) All contractors with on-going contracts which (i) extend beyond fiscal year 2004 and (ii) for which fiscal year 2005 funding will be provided must be notified of funding restrictions under the CR.

6. Action Required:

(a) Regional acquisition offices should distribute this memorandum to all acquisition personnel.

(b) Contracting Officers shall:

(1) Insert the attached clause(s) into all purchase orders, contracts, and contract modifications to exercise options to be funded under this authority. The amount spaces may be completed by specific reference to Section B of a contract or the Line Item Detail of an order.

(2) Send written notification using the attached sample notification letter (or a letter containing similar language) to all contractors with existing contracts containing any of the clauses at FAR 52.232-18 through 52.232-22 that are to be funded under this authority.

(c) If regional management determines that certain existing service contracts must continue in effect past the current, or any extended, CR expiration, available carryover funds may be used for this purpose. If such a determination is made for a contract, a bilateral contract modification should be issued (pursuant to the authority of mutual agreement of the parties), which increases the funds allotted and the period for allotment. The modification should clearly indicate that the additional funds being added are carryover monies and not CR money subject to the clauses contained in this guidance.

(d) Refer all questions to Ron Simonich (303) 445-2447 or via LAN.

Attachments