Indefinite Delivery/Indefinite Quantity (IDIQ) contracts are flexible contracting mechanisms used primarily by government agencies to procure goods or services over a specified period without committing to a fixed quantity at the outset. They are designed to meet recurring needs when the exact quantities or delivery schedules cannot be determined in advance. Here’s an overview of IDIQ contracts:
Key Features of IDIQ Contracts:
- Flexibility in Quantity:
- These contracts provide for an indefinite quantity of supplies or services, allowing the buyer to order as needed, up to a stated maximum, during the contract period.
- A minimum order quantity or value is guaranteed to the contractor, ensuring some level of compensation.
- Flexibility in Delivery:
- Delivery schedules are determined through task or delivery orders issued during the contract’s term.
- Ordering Mechanism:
- The buyer issues task orders (for services) or delivery orders (for goods) to specify the exact requirements for each order.
- Contract Duration:
- IDIQ contracts are typically multi-year agreements, with an initial base period and several option periods that can extend the contract duration.
- Ceiling Value:
- The contract includes a maximum value or quantity for orders, which cannot be exceeded without modifying the contract.
- Multiple or Single Award:
- IDIQ contracts can be awarded to a single contractor or to multiple contractors, providing competition for individual task or delivery orders.
Advantages of IDIQ Contracts:
- Efficiency: Reduces the need for repeated procurement processes for recurring needs.
- Scalability: Allows the government to adjust to changing needs over time.
- Simplified Administration: Streamlines procurement by using task or delivery orders rather than negotiating new contracts for every need.
Common Uses:
IDIQ contracts are frequently used in industries like:
- Construction: For ongoing repair, maintenance, or construction services.
- IT Services: For software development, support, or technology upgrades.
- Professional Services: For consulting, training, or research.
- Supplies: For recurring orders of products, like office supplies or equipment.
Read the Congressional Service Report on IDIQ Contracts
Example:
The U.S. General Services Administration (GSA) uses IDIQ contracts extensively under programs like the GSA Schedules, which allow federal agencies to procure goods and services from pre-approved vendors with pre-negotiated terms.In summary, IDIQ contracts are a valuable tool for managing uncertainty in procurement, providing the flexibility needed to respond to varying demand while maintaining cost and administrative efficiency.
Job Order Contracting (JOC) is a type of IDIQ contract for construction and remodeling.