Undefinitized Contract Action (UCA)
An undefinitized contract action (UCA) is a DoD contract action, commonly a letter contract, under which performance begins before terms, specifications, or price are agreed. DFARS 217.74 caps obligations at 50 to 75 percent of the not-to-exceed price until definitization.
UCAs exist for the case where waiting to negotiate a complete contract would damage the mission: urgent repairs, surge production, fast-moving requirements. The contracting officer sets a not-to-exceed price, obtains head of the contracting activity approval, and lets performance begin, with full terms to be definitized later. The civilian-agency cousin is the letter contract under FAR 16.603.
The discipline is in the clocks and caps. Definitization must occur by the earlier of 180 days after the contractor submits a qualifying proposal or the point where obligations pass 50 percent of the not-to-exceed price. Before definitization the government may obligate no more than 50 percent of that price — 75 percent once a qualifying proposal is in hand.
The structural problem is bargaining position: a contractor already performing has little urgency about agreeing to price. That is why DFARS 217.7404-6 requires the negotiated profit to reflect any reduced cost risk on costs incurred before price agreement.
Regulatory Reference
10 U.S.C. ch. 244; DFARS 217.74; DFARS 217.7404-6; FAR 16.603
RFO Status
UCA policy lives in the DFARS and title 10 rather than the FAR, so the overhaul does not rewrite it directly; the RFO Part 16 model deviation retains letter contract coverage at 16.603, so the companion citation carries over.
Category
Contract Types & Vehicles
How AcqBot Helps
AcqBot tracks every open UCA against its definitization deadline and obligation ceiling, warns the contracting officer as the 180-day and 50 percent triggers approach, and assembles the definitization package from the qualifying proposal.
Related glossary entries
Other Transaction Authority (OTA)
Other Transaction Authority (OTA) lets certain agencies enter agreements for research, prototypes, and follow-on production that are not standard procurement contracts — largely exempt from the FAR — to attract nontraditional contractors and move faster than conventional acquisition allows.
Indefinite Delivery/Indefinite Quantity (IDIQ)
An Indefinite Delivery/Indefinite Quantity (IDIQ) contract buys an unspecified quantity of supplies or services, within stated minimum and maximum limits, over a fixed period. The government buys through task or delivery orders under FAR 16.504, with a preference for multiple awards.
Firm-Fixed-Price (FFP)
A firm-fixed-price (FFP) contract sets a price that is not subject to adjustment based on the contractor's cost experience in performance. FAR 16.202 places maximum cost risk on the contractor, who absorbs every overrun and keeps every underrun.
Cost-Plus-Fixed-Fee (CPFF)
A cost-plus-fixed-fee (CPFF) contract reimburses allowable costs and pays a fee negotiated and fixed at inception. The fee does not vary with actual cost, though it may adjust when the work changes. FAR 16.306 governs; statutory caps limit the fee.