FAR 16.402-4 Structuring multiple-incentive contracts

Subsection Federal Acquisition Regulation

Facts

Citation
FAR 16.402-4
Type
Subsection
Proposed changes
1
Text as of
FAC 2026-01
Official text
acquisition.gov

Text from acquisition.gov. Federal Register history from the Federal Register's records of the rules that amended this subsection.

Text

A properly structured multiple-incentive arrangement should-

(a) Motivate the contractor to strive for outstanding results in all incentive areas; and

(b) Compel trade-off decisions among the incentive areas, consistent with the Government’s overall objectives for the acquisition. Because of the interdependency of the Government’s cost, the technical performance, and the delivery goals, a contract that emphasizes only one of the goals may jeopardize control over the others. Because outstanding results may not be attainable for each of the incentive areas, all multiple-incentive contracts must include a cost incentive (or constraint) that operates to preclude rewarding a contractor for superior technical performance or delivery results when the cost of those results outweighs their value to the Government.

Proposed changes

Proposed rule Published Comments
Federal Acquisition Regulation: Revolutionary Federal Acquisition Regulation Overhaul Parts 16, 17, and 35 91 FR 59476 · FAR Case 2026-006, Docket No. FAR-2026-0006, Sequence No. 1 Closed Oct 19, 2026No final rule found

Quick answers

What is FAR 16.402-4?

FAR 16.402-4 is a subsection of the Federal Acquisition Regulation, titled "Structuring multiple-incentive contracts".

Are changes to FAR 16.402-4 proposed?

One proposed change has no final rule yet.

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