Appendix C to Part 1136 - Terms and Conditions for OAR Article III, “Remedies and Termination”
2:1.2.8.6.17.7.64.3.51 : Appendix C
Appendix C to Part 1136 - Terms and Conditions for OAR Article III,
“Remedies and Termination”
As required by § 1136.305, a DoD Component's general terms and
conditions must use the following wording for OAR Article III.
OAR Article III. Remedies and Termination. (DECEMBER 2014)
Section A. Non-compliance with award terms and
conditions. If you fail to comply with a term or condition of
this award or an applicable Federal statute or regulation, we may
amend this award to impose award-specific conditions, as described
in OMB guidance in 2 CFR 200.207. If imposing award-specific
conditions, we will notify you before modifying the award and, once
you have corrected the non-compliance, promptly remove the
award-specific conditions. If we determine that the imposition of
award-specific conditions is insufficient to correct the
non-compliance or the non-compliance remains uncorrected despite
the use of award-specific conditions, we may consider taking one or
more of the remedies specified in Section B of this article.
Section B. Remedies for noncompliance.
1. If you fail to comply with a term or condition of this award
or an applicable Federal statute or regulation, we may take one or
more of the following actions that we deem appropriate to the
circumstances:
a. Temporarily withhold cash payments pending:
i. Your correction of the deficiency; or
ii. Our taking more severe enforcement action.
b. Disallow (that is, deny both use of funds and any applicable
cost-sharing or matching credit for) all or part of the cost of the
activity or action not in compliance;
c. Suspend or, in accordance with paragraph C.1.a.i of this
article, terminate this award, in whole or in part (suspension of
an award is a separate and distinct action from suspension of a
person under 2 CFR parts 180 and 1125, as noted in paragraph B.3 of
this article);
d. Withhold further awards to you for the project or program
that is not in compliance;
e. Take any other action legally available to us under the
circumstances.
2. You may raise an objection to our taking any remedy we take
under paragraph B.1 of this section and will be given an
opportunity to provide information and documentation challenging
the action. The procedures are those specified in OAR Article IV
for claims and disputes.
3. Our use of any remedy under paragraph B.1 of this section,
including suspension or termination of the award, does not preclude
our referring the noncompliance to a suspension and debarment
official and asking that official to consider initiating a
suspension or debarment action under 2 CFR part 1125, the DoD
implementation of OMB guidance at 2 CFR part 180.
Section C. Termination.
1. This award may be terminated in whole or in part as
follows:
a. Unilaterally by the Federal Government. We will
provide a notice of termination if we unilaterally terminate this
award in whole or in part, which we may do for either of the
following reasons:
i. Your material failure to comply with the award terms and
conditions. If we terminate the award for that reason, we will
report the termination to the OMB-designated integrity and
performance system (currently FAPIIS). In accordance with 41 U.S.C.
2313, each Federal awarding official must review and consider the
information in the OMB-designated integrity and performance system
with regard to any proposal or offer before awarding a grant or
contract.
ii. The program office does not have funding for an upcoming
increment if this award is incrementally funded. In that case, the
Federal Government's financial obligation does not exceed the
amount currently obligated under the award.
b. By mutual agreement. With your consent, we may
terminate this award, in whole or in part, for any reason. In that
case, you and we must agree to:
i. The termination conditions, including the effective date;
and
ii. In the case of a partial termination, the portion to be
terminated.
c. Unilaterally by the recipient. You may unilaterally
terminate this award, in whole or in part, by sending us written
notification that states:
i. The reasons for the termination;
ii. The effective date; and
iii. In the case of partial termination, the portion to be
terminated. In that case, however, we may terminate the award in
its entirety if we determine that the remaining portion of the
award will not accomplish the purposes for which we made the
award.
2. If this award is terminated in its entirety before the end of
the performance period, you must complete the closeout actions for
which you are responsible under OAR Article VI. The due date for
each action is to be measured relative to the date of
termination.
3. If this award is only partially terminated before the end of
the performance period, with a reduced or modified portion of the
award continuing through the end of the performance period, then
closeout actions will occur at the end of the performance period as
specified in OAR Article VI.
4. You will continue to have all of the post-closeout
responsibilities that OAR Article VII specifies for you if this
award is wholly or partially terminated before the end of the
performance period.
Section D. Effects of suspension or termination of the award
on allowability of costs. If we suspend or terminate this award
prior to the end of the period of performance, costs resulting from
obligations that you incurred:
1. Before the effective date of the suspension or termination
are allowable if:
a. You properly incurred those obligations;
b. You did not incur the obligations in anticipation of the
suspension or termination;
c. In the case of termination, the costs resulted from
obligations that were noncancellable after the termination; and
d. The costs would have been allowable if we had not suspended
or terminated the award and it had expired normally at the end of
the period of performance.
2. During the suspension or after the termination are not
allowable unless we expressly authorize them, either in the notice
of suspension or termination or subsequently.