Duration of Contracts - General

Section 8.2060  Duration of Contracts − General a)         General.  The duration of a construction or construction-related services contract, including potential renewals, may not exceed 10 years. unless a longer period is permitted by the Code b)         Subject to Appropriation.  Each contract is contingent upon and subject to the availability of funds.  The State, at its sole option, may terminate or suspend a contract, in whole or in part, without penalty or further payment being required, if the Illinois General Assembly or the federal funding source fails to make an appropriation sufficient to pay that obligation or if funds needed are insufficient for any reason.  Each contract payable in whole or in part by any funds appropriated by the Illinois General Assembly shall recite that the contract is subject to termination and cancellation for lack of, or insufficiency in, funding.  A vendor will be notified in writing by CDB of a failure to receive or a reduction or decrease in any appropriation affecting the contract.  This provision applies to only those contracts that are funded in whole or in part by funds appropriated by the Illinois General Assembly or other governmental entity. c)         Conditions for Use of Multi-Year Contracts.  A multi-year contract may be used when the period of performance exceeds a single year and when a multi-year contract will serve the best interest of the State by encouraging effective competition or otherwise promoting economies in State procurement. d)         Multi-Year Contract Procedure.  The solicitation shall state: 1)         the proposed term; 2)         the amount of supplies or services required for the proposed contract period; and 3)         how award will be determined. e)         Renewals 1)         The initial term of a contract plus available renewals may not exceed 10 years.  When the original contract specifically called for an initial term plus renewals, the renewals may be exercised without further procurement activity, except for the publication of the renewal in the Bulletin as required by Section 15-25 of the Code and Section 8.1525 of this Part and subject to review by the PPB under Section 5-30 of the Code.  The renewal terms and conditions shall not change except as provided in the contract (such as price escalations tied to an index).  Renewal options may be exercised by the State or by mutual agreement, but shall not be exercised solely at the option of the vendor.  Any renewal that requires modification to a material term or condition of the contract shall be treated as a new contract and shall be subject to competitive procurement procedures established by the Code and this Part. 2)         When the original contract was silent as to renewals, the renewal must be procured using one of the methods of source selection authorized by the Code and this Part.  The renewal shall start a new term not to exceed 10 years, except the term of a sole source contract renewal shall include previous sole source contracts and shall, in total, not exceed 10 years. 3)         When a renewal will result in the total term, counting the initial term and any previous renewals, exceeding 10 years, the State agency's need must be procured using one of the methods of source selection authorized by the Code and this Part. 4)         Renewals must be fully executed on or before expiration of the current contract term.  If the renewal is not exercised prior to expiration of the current contract term, the renewal must be procured using one of the methods of source selection authorized by the Code and this Part. 5)         Filing of Proposed Renewals and Extensions Exceeding $249,999.  Prior to executing a renewal or extension with a cost estimated to exceed $249,999, the proposed renewal or extension must be submitted to PPB.  PPB shall have up to 30 days to review and comment on the proposal.  The Procurement Policy Board may object to the proposed extension or renewal within 30 calendar days and require a hearing before the PPB prior to entering into the extension or renewal.  If the PPB does not object within 30 calendar days or takes affirmative action to recommend the extension or renewal, the CPO may enter into the extension or renewal of a contract.  The SPO assigned the agency may request a waiver of the review for reasons set forth in Section 20-60(c) of the Code.