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(a)   Pre-Contract cost authorization shall be reviewed by legal counsel and approved by the cognizant HCD or FCO before issuance. As a condition precedent to the use of a pre-contract cost agreement, the correct type of funds must be available upon issuance of the pre-contract cost agreement. Authorization must be in writing and shall address the following:

(b)   Indicate on the Standard Form 26, Award/Contract, Block 15, and in Section G of any resultant contract the date pre-contract costs were approved. This notifies the payment office that the pre-contract costs are allowable and that the contractor may be reimbursed. The effective date of the contract shall be the date parties reach a bilateral agreement.
(c)   Pre-contract cost authorization shall not be used to cover a period in excess of 30 days or $100,000, unless a longer period/larger dollar threshold is approved by the HCA via a written determination and findings that such an allowance is reasonable, and shall not be extended or renewed.
(d)   Contracting officers may insert a clause substantially the same as 5652.231-9000, Authorization of Pre-Contract Cost, when authorized for use.

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