Contracting Officer Unlimited Warrant Board
1. What is an option? An option is a unilateral right in a contract, for a
specific period of time, where the Government may elect to
purchase additional supplies or services called for by the
contract, or extend the period of performance.
2. When should options be used? The PCO should use options when
(1) in the Governments best interest, (2) there is a need for service
beyond the initial period, and (3) to ensure continuity of
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3. When is it not beneficial to use options? The use of options are not normally
in the Governments best interest when (1) The foreseeable
requirements involve minimum economic quantities and delivery
requirements are far enough in the future to permit competitive
acquisition, production, and delivery (2) an indefinite quantity or
requirements contract would be more appropriate than a contract
with options.
4. What must a PCO do before exercising an option? The PCO must
determine that:
a. Funds are available
b. The requirement fulfills an existing Government need
c. Exercising the option is the most advantageous method price
and other factors considered
d. The option was synopsized IAW FAR 5 (or exempted)
The PCO should have a written D&F in the file in order to use
options The PCO should also consider if the contractor is
responsible and if their performance is satisfactory.
5. If the option price during a competitive source selection was not evaluated, is the option
valid? No. All options need to be priced because they were awarded
on a competitive basis.
6. Can the PCO cite the "Changes Clause" to increase quantities on a production contract? No.
The Changes Clause cannot be used to increase quantities on a
production contract.
(a) The Contracting Officer may at any time, by written order, and
without notice to the sureties, if any, make changes within the
general scope of this contract in any one or more of the following:
(1) Drawings, designs, or specifications when the supplies to be
furnished are to be specially manufactured for the Government in
accordance with the drawings, designs, or specifications.
(2) Method of shipment or packing.
(3) Place of delivery.