§40111 Multiyear Procurement Contracts for Services and Related Items

Summary

The FAA Administrator may sign contracts that last up to five years for certain ongoing services and the supplies tied to those services. Covered work includes running and fixing facilities, operating and fixing aircraft and other complex gear, specialized training like pilot, aircrew, and foreign language instruction, and base services such as ground upkeep, refueling, bus transport, and trash pickup. The Administrator can only use these contracts if there is a continued need that matches plans, the work needs a big initial investment or a big cost to put together and train a special workforce, and the contract will help the U.S. by keeping competition and saving money. When charging equipment or plant costs to the contract, only a fair share can be billed based on the contract length compared to the item’s expected useful commercial life, taking into account location, special use, and obsolescence. The FAA should think about adding a renewal option for up to three years at a price that does not re-charge costs already paid, and may reserve the right to buy the equipment later by paying the unamortized cost. If money is not provided for the next fiscal year, the contract must end. Costs to close out the contract can come from the original money used, other available funds for that kind of service, or money set aside to end contracts.