SpendQueryBeta

FAR and DFARS › DFARS Part 235: Research and Development Contracting

DFARS 235.006 Contracting methods and contract type.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This DFARS section sets rules for choosing contract types in defense acquisition. For major defense acquisition programs, it requires following certain procedures and notifying the milestone decision authority if the government does not plan to exercise a fixed-price production option. For other development programs, it restricts when a fixed-price contract can be awarded and requires written determinations and high-level approvals for large price changes.

Applies to: Department of Defense contracting for development programs and major defense acquisition programs

What it requires

  • For major defense acquisition programs, follow the procedures at 234.004.
  • For major defense acquisition programs, notify the milestone decision authority reasonably in advance if you do not intend to exercise a fixed-price production option on a development contract for a major weapon system.
  • For other than major defense acquisition programs, do not award a fixed-price type contract for a development program effort unless the level of program risk permits realistic pricing and the contract type allows an equitable and sensible allocation of risk, and a written determination is executed b
  • For certain large fixed-price development contract actions, obtain USD(A&S) approval of the prenegotiation position before negotiations and of the negotiated agreement before execution.

Key terms: major defense acquisition programs · fixed-price type contract · milestone decision authority · USD(A&S) · prenegotiation position

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

(b)(i) For major defense acquisition programs as defined in 10 U.S.C. 4201—

(A) Follow the procedures at 234.004; and

(B) Notify the milestone decision authority of an intent not to exercise a fixed-price production option on a development contract for a major weapon system reasonably in advance of the expiration of the option exercise period.

(ii) For other than major defense acquisition programs—

(A) Do not award a fixed-price type contract for a development program effort unless—

(1) The level of program risk permits realistic pricing;

(2) The use of a fixed-price type contract permits an equitable and sensible allocation of program risk between the Government and the contractor; and

(3) A written determination that the criteria of paragraphs (b)(ii)(A)(1) and (2) of this section have been met is executed—

(i) By the USD(A&S) if the contract is over $25 million and is for: research and development for a non-major system; the development of a major system (as defined in FAR 2.101); or the development of a subsystem of a major system; or

(ii) By the contracting officer for any development not covered by paragraph (b)(ii)(A)(3)(i) of this section.

(B) Obtain USD(A&S) approval of the Government's prenegotiation position before negotiations begin, and obtain USD(A&S) approval of the negotiated agreement with the contractor before the agreement is executed, for any action that is—

(1) An increase of more than $250 million in the price or ceiling price of a fixed-price type development contract, or a fixed-price type contract for the lead ship of a class;

(2) A reduction in the amount of work under a fixed-price type development contract or a fixed-price type contract for the lead ship of a class, when the value of the work deleted is $100 million or more; or

(3)) A repricing of fixed-price type production options to a development contract, or a contract for the lead ship of a class, that increases the price or ceiling price by more than $250 million for equivalent quantities.

Sections it refers to

Sections that refer to it

← 235.001 Definitions. · 235.006-70 Manufacturing Technology Program. →

Rule changes for DFARS Part 235

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.

DFARS 235.006 Contracting methods and contract type · SpendQuery