---
kind: "section"
citation: "48 C.F.R. § 235.006"
title: "48"
number: "235.006"
heading: "Contracting methods and contract type."
url: "https://uscodex.org/cfr/48/235.006"
---

# §235.006. Contracting methods and contract type.

- (b)
- (i) For major defense acquisition programs as defined in [10 U.S.C. 4201](/usc/10/4201.md)—
  - (A) Follow the procedures at 234.004; and
  - (B) Notify the milestone decision authority of an intent not to exercise a fixed-price production option on a development contract for a major weapon system reasonably in advance of the expiration of the option exercise period.
- (ii) **For other than major defense acquisition programs—**
  - (A) **Do not award a fixed-price type contract for a development program effort unless—** (1) The level of program risk permits realistic pricing;

    (2) The use of a fixed-price type contract permits an equitable and sensible allocation of program risk between the Government and the contractor; and

    (3) A written determination that the criteria of paragraphs (b)(ii)(A)(1) and (2) of this section have been met is executed—

    (i) By the USD(A&S) if the contract is over $25 million and is for: research and development for a non-major system; the development of a major system (as defined in FAR 2.101); or the development of a subsystem of a major system; or

    (ii) By the contracting officer for any development not covered by paragraph (b)(ii)(A)(3)(i) of this section.

  - (B) Obtain USD(A&S) approval of the Government's prenegotiation position before negotiations begin, and obtain USD(A&S) approval of the negotiated agreement with the contractor before the agreement is executed, for any action that is—

    (1) An increase of more than $250 million in the price or ceiling price of a fixed-price type development contract, or a fixed-price type contract for the lead ship of a class;

    (2) A reduction in the amount of work under a fixed-price type development contract or a fixed-price type contract for the lead ship of a class, when the value of the work deleted is $100 million or more; or

    (3)) A repricing of fixed-price type production options to a development contract, or a contract for the lead ship of a class, that increases the price or ceiling price by more than $250 million for equivalent quantities.


## Notes

### Amendments

[73 FR 4118, Jan. 24, 2008, as amended at 84 FR 65308, Nov. 27, 2019; 87 FR 65513, Oct. 28, 2022; 87 FR 76995, Dec. 16, 2022]

### Authority

Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.

### Source

Source: 56 FR 36416, July 31, 1991, unless otherwise noted.

### Amendments

[73 FR 4118, Jan. 24, 2008, as amended at 84 FR 65308, Nov. 27, 2019; 87 FR 65513, Oct. 28, 2022; 87 FR 76995, Dec. 16, 2022]