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Cost Determines Credit For Deductive Change Changes-deductive

Wednesday, March 03, 2004 12:21 pm

Cost Determines Credit For Deductive Change Changes-deductive

The Department of the Interior Board of Contract Appeals has ruled that when pricing a deductive change to a fixed-price contract, the government is entitled to a credit for only the contractor's direct cost savings, not the line item price. The contractor is entitled to keep the overhead and profit components of the price.

The Department of the Interior's Office of Surface Mining Reclamation solicited bids for emergency reclamation work at a mine in Indianola, Iowa. The bid schedule consisted of unit-priced line item [...]

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