New Pro-Competitive Restrictions On DoD Prototype Line Items and Options

On June 8, 2010, DoD issued an interim rule, intended to prevent competitively awarded contracts for new technology from becoming noncompetitive efforts long-term. The interim DFARS provisions require that contract line item purchases and contract options must be limited to the minimum number of initial or additional prototype items that will allow for timely competitive solicitation and award of a follow-on development or production contract for those items; that the term of the contract line item or contract option cannot be longer than 12 months; and that the dollar value of the work to be performed pursuant to the contract line item or contract option may not exceed three times the dollar value of the work previously performed under the contract or $20 million, whichever is less.