Andy, a contracting officer, is reviewing a Performance Based Payment (PBP) request from his contractor. The PBP event listed in the contract requires the contractor to complete the mock-up of a prototype unit for Government technical team review. The contractor has completed 99% of the mock-up, but ran into a delay with a 3rd tier subcontractor. The contractor informs Andy that the mock-up will be 99% complete at the time of the Government review. Based only on these facts, may Andy approve the PBP request at this time?

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Isabelle Ferguson

28 May, 09:58

Andy, a contracting officer, is reviewing a Performance Based Payment (PBP) request from his contractor. The PBP event listed in the contract requires the contractor to complete the mock-up of a prototype unit for Government technical team review. The contractor has completed 99% of the mock-up, but ran into a delay with a 3rd tier subcontractor. The contractor informs Andy that the mock-up will be 99% complete at the time of the Government review. Based only on these facts, may Andy approve the PBP request at this time?

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Mariela Gilmore · Answer 1

Answer: No. Andy must not approve the PBP request at this time because it is not 100% complete.

Explanation:

Performance-based payment is the transfer of money after a measurable action has been taken or a performance target that has been predetermined has been met.

In this scenario, we are told that the contractor has completed 99% of the mock-up, but ran into a delay with a 3rd tier subcontractor and that the contractor then inform Andy that the mock-up will be 99% complete at the time of the Government review. Dur to this, Andy should not approve this because the PBP event is not yet 100%. For payment to be approved, it must be 100%.