HHS Reference Tool for Contract Funding, Formation and Appropriations Law Compliance
Single Definitive Contract
It is possible for a single contract to contain a significant portion of both severable and non-severable services. In such cases, the services must be structured as separate contract line items and funded in accordance with the appropriations law principles applicable to the service type. However, in a situation where the contract requirement is primarily for one type of service (e.g., non-severable), but contains incidental services of the second type (e.g., severable) that cannot be feasibly separated, the contract should be managed and funded consistent with its core services. Consider, for example, a 24-month contract for a non-severable research project that includes a requirement for ongoing analysis of drug compounds as a minor component. There is no need to artificially separate the severable drug analysis activity from the core contract requirement for non-severable research services. This contract would most appropriately be considered and managed as a contract for non-severable services given that the severable component is incidental to the contract’s primary purpose.