Maryland Statutes
Part III - Contract Formation
Section 13-215 - Cost-Reimbursement Contracts

(a)    A unit may not enter into a cost-reimbursement contract unless the procurement officer determines that:
        (1)    a cost-reimbursement contract is likely to be less costly to the State than any other type of contract; or
        (2)    except for leases of real property, the kind or quality of procurement that the unit requires could not be obtained practicably under any other type of contract.
    (b)    A unit may not enter into a procurement contract that is wholly or partly a cost-reimbursement contract unless the procurement officer determines that the accounting system of the contractor:
        (1)    will allow timely development of all necessary cost data in the form required by the specific type of procurement contract under consideration; and
        (2)    is adequate to allocate costs in accordance with generally accepted accounting principles.
    (c)    A cost-reimbursement contract shall provide that costs, including costs for subcontractors, will be reimbursed only if the costs are allowable and allocable under:
        (1)    the procurement contract; or
        (2)    the regulations of the Board on cost principles.
    (d)    A contractor under a cost-reimbursement contract shall give notice to and, as required under the contract, obtain approval from a procurement officer before the contractor enters into:
        (1)    a cost-reimbursement subcontract; or
        (2)    any subcontract involving more than:
            (i)    $25,000; or
            (ii)    5% of the estimated cost of the procurement contract.

Structure Maryland Statutes