Army Contracting: Training and Guidance Needed to Ensure Appropriate Use of the Option to Extend Services Clause

Abstract : If a contracting officer needs to extend an existing contract to avoid a potential gap in services, the contracting officer may use a number of different authorities to do so. If the contract includes the option to extend services clause, the contracting officer could use this option to extend the contract. Contracting officers may exercise the option to extend services clause more than once as long as the total period of performance does not exceed 6 months. Specifically, FAR section 17.208(f) provides for the use of FAR clause 52.217-8, option to extend services, in solicitations and contracts for services when the inclusion of an option is appropriate. FAR section 37.111 notes that contracting officers may use this clause to avoid negotiation of short extensions to existing contracts and continue the performance of any services within the limits specified in the contract. The clause and associated provisions were established in 1989 so as to provide a way for the government to continue to receive services on recurring requirements when the award of subsequent contracts might be delayed, such as when there is a bid protest. In our October 2015 review of agencies use of bridge contracts, we found that agencies used the option to extend services clause as a way to bridge the potential gap in services for most of the 29 contracts reviewed in-depth. Since no formal definition of bridge contracts exists, for the purposes of our October 2015 report we defined bridge contracts as (1) an extension to an existing contract beyond the period of performance (including base and option years), or (2) a new short-term contract awarded on a sole-source basis to an incumbent contractor to avoid a lapse in service caused by a delay in awarding a follow-on contract.