2013 Maryland Code
STATE FINANCE AND PROCUREMENT
§ 13-215 - Cost-reimbursement contracts

§13-215.

(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.