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Termination, Stop Work, and Dispute Resolution

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Termination, Stop Work, and Dispute Resolution

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    1. NCURA 2008 Termination, Stop Work, and Dispute Resolution Michele Codd, Assistant Director, Vanderbilt University Institute for Software Integrated Systems Nancy Daneau, Assistant Director, Office of the Vice President for Research, Stony Brook University David Richardson, Assistant Vice President for Research, The Pennsylvania State University

    2. NCURA 2008 Stop Work Order A mandated pause of the work being performed Contracting Officer must obtain approval at higher level before issuing For negotiated acquisitions this order is prescribed in FAR 42.1303, governed by FAR 52.242-15 Make sure Alt I is included with FAR 52.242-15 if you are working under a CR contract

    3. NCURA 2008 Stop Work Order Characteristics Issued for a variety of reasons Must include description of work to be suspended Length of the stop-work order should be defined Must provide instructions on actions related to subcontracts

    4. NCURA 2008 Stop Work Order Upon issuance (usually within 30 days but they have 90) a contracting officer must decide to: Terminate the contact Cancel the stop-work order Continue the stop-work order

    5. NCURA 2008 Termination for Convenience Contract is terminated for convenience of the federal government. For educational and non-profit entities this order is prescribed in FAR 49.502, governed by FAR 52.249-5. Applies to both cost reimbursement and fixed price contracts.

    6. NCURA 2008 Termination for Default Contract is terminated for default for: contractors failure to perform the work within the contract timeframe carries out the work in a manner that endangers the overall performance of the contract. For educational and non-profit entities providing goods and services, this order is governed by FAR 52.249.9. Educational and non-profit entities conducting R&D are not subject to default; termination for convenience 52.249-5 is prescribed instead (FAR 49.502 (d).

    7. NCURA 2008 Termination Characteristics Issued for a variety of reasons Contractor typically has 10 days from date of receipt to rectify failure to perform. Contractor has opportunity to seek financial settlement.

    8. NCURA 2008 Institutional Perspective What is the action being taken? When was the notice received? What is the basis of the order? Has anyone corresponded in writing or by phone with the contracting officer? Has the principal investigator been informed?

    9. NCURA 2008 Institutional Perspective (cont.) What is the scale of the project? How many faculty, staff and graduate assistants are immediately impacted? What is the current accounts receivable status of the project? What are the projects level of noncancelable commitments? Have all investigators and related subcontractors been formally notified?

    10. NCURA 2008 Research Center Perspective Do the PI and institution have the same perspective on dispute resolution? Does the PI want to comply to preserve a good relationship with a prime contractor or sponsor? Would a disagreement with the sponsor risk other current or future awards?

    11. NCURA 2008 Fundamental Questions to Answer What is the basis for terminating? Funding priorities shift Programmatic refocus Default What are the immediate termination costs? What are non-cost termination challenges for the institution and PI? How will the final invoice be determined - best estimate or cost reimbursable?

    12. NCURA 2008 Tips for Mediation and Negotiation No fault situation: Mitigate impact to PI, institution Re-negotiate SOW and price, period of performance? Identify institutional discretionary or emergency funds to continue R&D Explore whether another part of agency can fund remaining work Look to other external sources of support Reconcile account immediately to ensure termination settlement proposal includes all costs

    13. NCURA 2008 Tips for Mediation and Negotiation Unacceptable progress: Communicate contracting officers representation of issues to PI, Chair, Dean, and senior management Pick up the phone or trek across campusget the PI to tell you whats happening from his/her perspective Assessment: cut and run or turn the boat around

    14. NCURA 2008 Tips for Mediation and Negotiation Broker a deal Add Co-PI to manage portion not progressing Consider replacement PI for overall effort Negotiate extension to cure period Set expectations Document issues and corrective action plan Re-negotiate deliverable schedule, milestones Communicate early and often Your commitment to PI and Government integral to positive outcome

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