Time Extension on Contracts
Q. What documentation is required for a time extension on contracts?
A. Time of delivery is a cardinal element of the contract. With respect to delays, the general rule in public contracting is that the contractor bears the risk of both time and cost for delays that it causes or that are within its control. Generally the contractor is excused for a delay caused by factors for which neither it or the transit agency is responsible. However, the contractor must bear the cost impact of such delays. The transit agency is responsible for both the time and cost effect of delays that it causes, which are under its control, or for which it has agreed to compensate the contractor. Therefore, the contract file documentation must establish the cause of the delay and a cost analysis of the impact on performance if any. If the delay was caused by the contractor and was not an excusable delay, the documentation should contain the compensation received by the agency for breach of contract. (Reviewed: June 2010)
Q. Can a contract be extended for a defined reasonable period beyond the original terminating date of the contract to allow the agency to complete a new grant application and to produce and process a new RFP? We are ending one grant for special service and the next grant has not been released as yet.
A. A time extension to a service contract that was awarded for a certain term would be a "new procurement" action - the same as a new contract award. You have the authority to process this action through the appropriate agency management officials as a sole source contract award in accordance with FTA Circular 4220.1F. You must document the reasons why a non-competitive contract extension is necessary and have the action approved by the official with authority to do so. As a point of information, FTA rescinded its requirement for prior approval on contracts whose term exceeds five years (Dear Colleague Letter C-02-08 dated May 29, 2002), so you will no longer have to obtain FTA approval for contract terms beyond five years. (Revised: June 2010)