§ 254c. — Multiyear contracts.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 41USC254c]
TITLE 41--PUBLIC CONTRACTS
CHAPTER 4--PROCUREMENT PROCEDURES
SUBCHAPTER IV--PROCUREMENT PROVISIONS
Sec. 254c. Multiyear contracts
(a) Authority
An executive agency may enter into a multiyear contract for the
acquisition of property or services if--
(1) funds are available and obligated for such contract, for the
full period of the contract or for the first fiscal year in which
the contract is in effect, and for the estimated costs associated
with any necessary termination of such contract; and
(2) the executive agency determines that--
(A) the need for the property or services is reasonably firm
and continuing over the period of the contract; and
(B) a multiyear contract will serve the best interests of
the United States by encouraging full and open competition or
promoting economy in administration, performance, and operation
of the agency's programs.
(b) Termination clause
A multiyear contract entered into under the authority of this
section shall include a clause that provides that the contract shall be
terminated if funds are not made available for the continuation of such
contract in any fiscal year covered by the contract. Amounts available
for paying termination costs shall remain available for such purpose
until the costs associated with termination of the contract are paid.
(c) Cancellation ceiling notice
Before any contract described in subsection (a) of this section that
contains a clause setting forth a cancellation ceiling in excess of
$10,000,000 may be awarded, the executive agency shall give written
notification of the proposed contract and of the proposed cancellation
ceiling for that contract to the Congress, and such contract may not
then be awarded until the end of a period of 30 days beginning on the
date of such notification.
(d) Multiyear contract defined
For the purposes of this section, a multiyear contract is a contract
for the purchase of property or services for more than one, but not more
than five, program years. Such a contract may provide that performance
under the contract during the second and subsequent years of the
contract is contingent upon the appropriation of funds and (if it does
so provide) may provide for a cancellation payment to be made to the
contractor if such appropriations are not made.
(e) Rule of construction
Nothing in this section is intended to modify or affect any other
provision of law that authorizes multiyear contracts.
(June 30, 1949, ch. 288, title III, Sec. 304B, as added Pub. L. 103-355,
title I, Sec. 1072, Oct. 13, 1994, 108 Stat. 3270.)
Effective Date
For effective date and applicability of section, see section 10001
of Pub. L. 103-355, set out as an Effective Date of 1994 Amendment note
under section 251 of this title.
Section Referred to in Other Sections
This section is referred to in sections 253l-1, 253l-2, 253l-3,
253l-4 of this title; title 42 section 7274n.
