(90) A fixed price contract with economic price adjustment may also be used to provide for price adjustments authorized in this section. (DAR Tracking Number 95-D0003, FARS DEV 96-10). (See 16.203-1, 16.203-2(90) and 16.203-4(90).
(91) An economic price adjustment (EPA) clause may be planned for use in the event the contracting officer substantiates in documentation included as part of the acquisition plan that the conditions cited in FAR 16.203-3 exist and an EPA provision is required to achieve one of the two objectives stated therein, and/or its use is authorized in this section.
(92) When the contracting officer determines that no existing FAR EPA clause (including a FAR EPA used in conjunction with the corresponding FAR EPA “Implementation” DLAD clause (see 16.203-4(a)(1)(90), -4(b)(1)(90), and -4(c)(1)(90)), no DFARS EPA clause and no DLAD EPA clause satisfies the need for an EPA clause, a new EPA clause may be developed in accordance with FAR 16.203-4, DFARS 216.203-4-70, and approved using 1.301-91. See DLAD PGI Part 16.203 (4)(9) for additional guidance.
(93) Prior to issuance of a solicitation containing a new EPA clause, the contracting officer shall submit the clause for review and approval in accordance with 1.301-91. This requirement also applies to acquisitions of commercial items.
(94) The CCO or designee (not lower than one level above the contracting officer) shall approve any ceiling exceeding ten (10) percent. Such approval may cover more than (1) contract and extend over a stated definite period of time not to exceed two (2) years.
(95) If not included in the EPA clause, the solicitation and contract shall contain, and the contracting officer shall ensure compliance with, the contractor's warranty that the contract prices do not include allowance for any contingency to cover increased costs also considered by the EPA clause. (When a contract option is also planned see 17.203(d).)
(96) If it becomes apparent that an EPA clause is clearly justified in a solicitation that did not include one, a FAR, DFARS, or DLAD EPA clause may be included by amendment to the solicitation and in any resulting contracts if all EPA contingencies covered by the EPA clause are removed from any formerly offered price(s).
