[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 38USC114]
TITLE 38--VETERANS' BENEFITS
PART I--GENERAL PROVISIONS
CHAPTER 1--GENERAL
Sec. 114. Multiyear procurement
(a) The Secretary may enter into a multiyear contract for the
procurement of supplies or services if the Secretary makes each of the
following determinations:
(1) Appropriations are available for obligations that are
necessary for total payments that would be required during the
fiscal year in which the contract is entered into, plus the
estimated amount of any cancellation charge payable under the
contract.
(2) The contract is in the best interest of the United States by
reason of the effect that use of a multiyear, rather than one-year,
contract would have in--
(A) reducing costs;
(B) achieving economies in contract administration or in any
other Department activities;
(C) increasing quality of performance by or service from the
contractors; or
(D) encouraging effective competition.
(3) During the proposed contract period--
(A) there will be a continuing or recurring need for the
supplies or services being procured;
(B) there is not a substantial likelihood of substantial
changes in the need for such supplies or services in terms of
the total quantity of such supplies or services or of the rate
of delivery of such supplies or services; and
(C) the specifications for the supplies or services are
expected to be reasonably stable.
(4) The risks relating to the prospective contractor's ability
to perform in accordance with the specifications and other terms of
the contract are not excessive.
(5) The use of a multiyear contract will not inhibit small
business concerns in competing for the contract.
(6) In the case of the procurement of a pharmaceutical item for
which a patent has expired less than four years before the date on
which the solicitation of offers is issued, there is no substantial
likelihood that increased competition among potential contractors
would occur during the term of the contract as the result of the
availability of generic equivalents increasing during the term of
the contract.
(b)(1) A multiyear contract authorized by this section shall
contain--
(A) a provision that the obligation of the United States under
the contract during any fiscal year which is included in the
contract period and is subsequent to the fiscal year during which
the contract is entered into is contingent on the availability of
sufficient appropriations (as determined by the Secretary pursuant
to paragraph (2)(A) of this subsection) if, at the time the contract
is entered into, appropriations are not available to cover the total
estimated payments that will be required during the full term of the
contract; and
(B) notwithstanding section 1502(a) of title 31, a provision for
the payment of reasonable cancellation charges to compensate the
contractor for nonrecurring, unrecovered costs, if any, if the
performance is cancelled pursuant to the provision required by
subparagraph (A) of this paragraph.
(2)(A) If, during a fiscal year after the fiscal year during which a
multiyear contract is entered into under this section, the Secretary
determines that, in light of other funding needs involved in the
operation of Department programs, the amount of funds appropriated for
such subsequent fiscal year is not sufficient for such contract, the
Secretary shall cancel such contract pursuant to the provisions required
by paragraph (1)(A) of this subsection.
(B) Cancellation charges under a multiyear contract shall be paid
from the appropriated funds which were originally available for
performance of the contract or the payment of cancellation costs unless
such funds are not available in an amount sufficient to pay the entire
amount of the cancellation charges payable under the contract. In a case
in which such funds are not available in such amount, funds available
for the procurement of supplies and services for use for the same
purposes as the supplies or services procured through such contract
shall be used to the extent necessary to pay such cost.
(c) Nothing in this section shall be construed so as to restrict the
Secretary's exercise of the right to terminate for convenience a
contract under any other provision of law which authorizes multiyear
contracting.
(d) The Secretary shall prescribe regulations for the implementation
of this section.
(e) For the purposes of this section:
(1) The term ``appropriations'' has the meaning given that term
in section 1511 of title 31.
(2) The term ``multiyear contract'' means a contract which by
its terms is to remain in effect for a period which extends beyond
the end of the fiscal year during which the contract is entered into
but not beyond the end of the fourth fiscal year following such
fiscal year. Such term does not include a contract for construction
or for a lease of real property.
(3) The term ``nonrecurring, unrecovered costs'' means those
costs reasonably incurred by the contractor in performing a
multiyear contract which (as determined under regulations prescribed
under subsection (d) of this section) are generally incurred on a
one-time basis.
(Added Pub. L. 100-322, title IV, Sec. 404(a), May 20, 1988, 102 Stat.
545; amended Pub. L. 101-237, title VI, Sec. 601(a), (b)(1), Dec. 18,
1989, 103 Stat. 2094; Pub. L. 102-83, Sec. 4(a)(3), (4), (b)(1), (2)(E),
Aug. 6, 1991, 105 Stat. 404, 405.)
Amendments
1991--
