42 CFR § 137.336 - What is the difference between fixed-price and cost-reimbursement agreements?

---
identifier: "/us/cfr/t42/s137.336"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "42 CFR § 137.336 - What is the difference between fixed-price and cost-reimbursement agreements?"
title_number: 42
title_name: "Public Health"
section_number: "137.336"
section_name: "What is the difference between fixed-price and cost-reimbursement agreements?"
chapter_name: "PUBLIC HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN SERVICES"
subchapter_number: "M"
subchapter_name: "INDIAN HEALTH SERVICE, DEPARTMENT OF HEALTH AND HUMAN SERVICES"
part_number: "137"
part_name: "TRIBAL SELF-GOVERNANCE"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "25 U.S.C. 458"
regulatory_source: "67 FR 35342, May 17, 2002, unless otherwise noted."
cfr_part: "137"
---


# 137.336 What is the difference between fixed-price and cost-reimbursement agreements?

(a) Cost-reimbursement agreements generally have one or more of the following characteristics:

(1) Risk is shared between IHS and the Self-Governance Tribe;

(2) Self-Governance Tribes are not required to perform beyond the amount of funds provided under the agreement;

(3) Self-Governance Tribes establish budgets based upon the actual costs of the project and are not allowed to include profit;

(4) Budgets are stated using broad categories, such as planning, design, construction project administration, and contingency;

(5) The agreement funding amount is stated as a “not to exceed” amount;

(6) Self-Governance Tribes provide notice to the IHS if they expect to exceed the amount of the agreement and require more funds;

(7) Excess funds remaining at the end of the project are considered savings; and

(8) Actual costs are subject to applicable OMB circulars and cost principles.

(b) Fixed Price agreements generally have one or more of the following characteristics:

(1) Self-Governance Tribes assume the risk for performance;

(2) Self-Governance Tribes are entitled to make a reasonable profit;

(3) Budgets may be stated as lump sums, unit cost pricing, or a combination thereof;

(4) For unit cost pricing, savings may occur if actual quantity is less than estimated; and,

(5) Excess funds remaining at the end of a lump sum fixed price project are considered profit, unless, at the option of the Self-Governance Tribe, such amounts are reclassified in whole or in part as savings.