---
kind: "section"
citation: "40 U.S.C. § 1104"
title: "40"
title_heading: "Public Buildings, Property, and Works"
number: "1104"
heading: "Negotiation of contract"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/40/1104"
units:
  - "Subtitle I — Federal Property and Administrative Services"
  - "Chapter 11 — Selection of Architects and Engineers"
---

# §1104. Negotiation of contract

- (a) **In General.—** The [agency head](/usc/40/1102.md?p=1) shall negotiate a contract for [architectural and engineering services](/usc/40/1102.md?p=2) at compensation which the [agency head](/usc/40/1102.md?p=1) determines is fair and reasonable to the Federal Government. In determining fair and reasonable compensation, the [agency head](/usc/40/1102.md?p=1) shall consider the scope, complexity, professional nature, and estimated value of the services to be rendered.
- (b) **Order of Negotiation.—** The [agency head](/usc/40/1102.md?p=1) shall attempt to negotiate a contract, as provided in [subsection (a)](#a), with the most highly qualified [firm](/usc/40/1102.md?p=3) selected under [section 1103 of this title](/usc/40/1103.md). If the [agency head](/usc/40/1102.md?p=1) is unable to negotiate a satisfactory contract with the [firm](/usc/40/1102.md?p=3), the [agency head](/usc/40/1102.md?p=1) shall formally terminate negotiations and then undertake negotiations with the next most qualified of the selected [firms](/usc/40/1102.md?p=3), continuing the process until an agreement is reached. If the [agency head](/usc/40/1102.md?p=1) is unable to negotiate a satisfactory contract with any of the selected [firms](/usc/40/1102.md?p=3), the [agency head](/usc/40/1102.md?p=1) shall select additional [firms](/usc/40/1102.md?p=3) in order of their competence and qualification and continue negotiations in accordance with this section until an agreement is reached.

## Source credit

(Pub. L. 107–217, Aug. 21, 2002, 116 Stat. 1130.)

## Notes

| Historical and Revision Notes |  |  |
| --- | --- | --- |
| Revised<br>Section | Source (U.S. Code) | Source (Statutes at Large) |
| 1104 | 40:544. | June 30, 1949, ch. 288, title IX, § 904, as added Pub. L. 92–582, Oct. 27, 1972, 86 Stat. 1279. |