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DSCR

DSCR I78: ECONOMIC PRICE ADJUSTMENT (EPA) - PETROLEUM PRODUCT

I78   52.216-9G01   ECONOMIC PRICE ADJUSTMENT   DSCR (JAN 1996)
AND                 PETROLEUM PRODUCTS 
I16F30
                               PART A

    The prices payable under this contract shall be subject to 
adjustment on a monthly basis or as otherwise provided below, 
upward or downward, in accordance with the provisions hereinafter.

                               PART B

    Definitions of terms as used throughout this Price Adjustment 
Clause:

         (a)  "Base Unit Price" is the unit price offered for an 
item and included in Section B of the contract award schedule.

         (b)  "Reference Value" is the wholesale price index developed 
by the Bureau of Labor Statistics (BLS) of the U.S. Department of 
Labor on a monthly basis (modified from time to time) and released 
the following month.  The reference value tabulation included 
in Part C, paragraph (a) of this clause, specifies the commodity 
wholesale price index used as the reference value for price 
adjustments for each line item.

         (c)  "Base Reference Value" is the index value for the 
month previous to the month in which the offer date falls.
(The base reference value shall be subject to recomputation in 
accordance with paragraph (e) below.)

         (d)  "Final Reference Value" for timely deliveries is 
the index values applicable to the month previous to the month 
of delivery.  "Final reference value" for an unexcused late 
delivery means the final reference value computed by using either:
(1) The index values applicable to the month previous to the month 
in which delivery was scheduled or; (2) the index values applicable 
to the month previous to the month in which actual delivery was 
made, whichever produces the lower final reference value.
(The final reference value shall be subject to recomputation in 
accordance with paragraph (e) below.)

         (e)  "Index Values Applicable to the Month" as used in 
paragraphs (c) and (d) above, means the wholesale price indexes 
determined by the BLS for a particular month from data compiled by 
the BLS within that month.  The wholesale price indexes so 
developed are normally released by the BLS in the first week 
of the following month.  In the event that the BLS publishes a 
revision(s) to a wholesale price index previously used to:
(1) determine an index value applicable to a particular month and; 
(2) to compute an adjustment to the contract price, then such 
revision(s) shall be used as a basis to recompute a further contract 
price adjustment according to the provisions of this clause.
The application of this provision shall not be limited by the 
Government's final acceptance of the supplies provided under this 
contract.

         (f)  "Adjusted Unit Price" is the base unit price 
adjusted in accordance with this clause, rounded to four decimal 
places.

         (g)  "Offer Date" is the date of bid opening, under 
sealed bid procedures or the closing date for receipt of 
offers, under negotiation procedures.

                               PART C

         (a)  Reference Value Tabulation

 CONTR
 LINE       BLS         BLS        INDEX      PERCENTAGE     UNIT
 ITEM NO.   COMMODITY   TABLE NO.  CODE NO.   OF BASE YEAR   BASE PRICE

                                                                             

         (b)  Price adjustment shall be as follows:  For any given 
month, the prices payable under this contract shall be the unit base 
price increased or decreased by the difference in the weighted 
"Base Reference Value" and the "Final Reference Value" computed as 
follows:

          Adjusted Unit Price =

     ((FINAL REF VALUE/BASE REF VALUE)  X  PERCENT OF UNIT BASE PRICE) +  
      (BASE UNIT PRICE  X  (100%  -  PERCENT OF UNIT BASE PRICE))

         (c)  Each price adjustment becoming due under the provisions 
of this clause shall be made effective with the prompt issuance of a 
contract modification by the Contracting Officer.

         (d)  Total increase in unit base price is limited 
to       % (percent).  (Also see the applicable Price Ceiling 
Clause of this contract).

         (e)  In the event that U.S. Department of Labor 
discontinues determination or alters the method of computation of 
an index identified herein, the parties shall agree upon an 
appropriate substitute or adjustment.

         (f)  If the Contracting Officer determines that the index 
consistently and substantially fails to reflect market conditions, 
the Contracting Officer may amend the contract to specify use of an 
appropriate substitute index, effective on the date the index 
specified in the contract begins to consistently and substantially 
fail to reflect market conditions.

                               PART D

  EXAMPLE OF ADJUSTMENT:

 CONTR
 LINE      BLS          BLS         INDEX        PERCENTAGE     UNIT 
 ITEM NO.  COMMODITY    TABLE NO.   CODE NO.     OF BASE YEAR   BASE PRICE

 0001      MOTOR OIL        6       0576 0101.06      80%
           PREMIUM GRADE

        "Base Unit Price" for Contract Line Item 0001 = $1.00

        "Base Reference Value" for Commodity - Motor Oil Premium Grade 
         (BLS code 0576 0101.06) = 118.

        "Percentage of Unit Base Price" Commodity - Motor Oil Premium 
         Grade = (80%) or .8

        "Final Reference Value" Commodity - Motor Oil Premium Grade = 118.6

    CALCULATIONS:

             Adjusted Unit Price =

     ((FINAL REF VALUE/BASE REF VALUE)  X  PERCENT OF UNIT BASE PRICE) +  
      (BASE UNIT PRICE  X  (100%  -  PERCENT OF UNIT BASE PRICE))

           OR:

        = ((118.6/118.0) x .80) + (1.00 x (1.00 - .80))

        = (1.005 x .8) + (1.00 x .2)

        = .804 + .2

        = 1.004