(a) Supplies or services.
(1) You should use options when they meet one or more of the following objectives:
(i) Reduce procurement lead time and associated costs.
(ii) Ensure continuity of contract support.
(iii) Improve overall contractor performance.
(iv) Facilitate longer term contractual relationships with those contractors that continually meet or exceed quality performance expectations.
(2) An option is normally in the Government’s interest in the following circumstances:
(i) You anticipate a need for additional supplies or services during the contract term.
(ii) Multiyear contracting authority is not available or its use is inappropriate and you anticipate a need for additional supplies or services beyond the initial contract term.
(iii) There is a need for continuity of supply or service support.
(iv) Funds are not available for the entirety of the Government’s needs, but are likely to become available during the contract term.
(v) The initial contract will be used to evaluate the performance of an emerging small business.
(3) Do not use an option if the market price is likely to change substantially and an economic price adjustment clause inadequately protects the Government’s interest.
(b) Construction. For limitations on the use of options, see 536.213 and 536.270.
