How Should Contractors Plan for Budget Impasses and Continuing Resolutions?

According to Acquisition.gov’s FAR Subpart 32.7, no Government officer may create or authorize an obligation in excess of available funds or in advance of appropriations unless another law authorizes it. Before a contract is executed, the contracting officer must either obtain written assurance that adequate funds are available or expressly condition the contract on availability of funds. FAR Subpart 32.7 also says a one-year indefinite-quantity or requirements contract for services funded by annual appropriations may extend into the next fiscal year if the minimum quantities are certain to be ordered in the initial fiscal year and the contract includes the Availability of Funds for the Next Fiscal Year clause. For limited-cost contracts, the contractor must notify the contracting officer in writing when expected next-60-day costs will push total costs above 75 percent of the estimated cost. Under 52.232-19, funds are not presently available beyond the stated date, and no legal liability arises beyond that date until funds are made available and the contractor receives written notice.