Type: Law Bulletins
Date: 11/08/2013

Sharpen Your Pencils - Guidance Published on Government Shutdown REAs

On Oct. 30, 2013, the Defense Contract Management Agency (DCMA) published guidance for Administrative Contracting Officers (ACOs) about how to handle contractors' requests for equitable adjustment (REAs) to recover their costs due to the recent federal government shutdown. The guidance provides ACOs with a step-by-step process for evaluating REAs:

  1. Evaluate whether the ACO is the appropriate point-of-contact.
  2. Determine the facts underlying the REA.
  3. Scrutinize the costs.

The review process is nothing new. What is noteworthy is the government’s recognition that contractors are going to ask to be reimbursed for their costs attributable to the federal government shutdown. It should raise some eyebrows that the government is actually considering paying claims — as long as they are appropriately documented and reviewed — rather than simply stonewalling or denying all contractor attempts to recoup their shutdown costs.

In light of the DCMA's memo, it may be worth reconsidering whether or not to submit an REA. Keep in mind that submitted REAs should be well documented as to the justification for recovery and as to the amounts requested. In addition, due to potential long lines, the sooner an REA is submitted the more likely it will receive timely consideration.


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