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Report: DOT Could Cancel Contracts Under Sequestration

signingThe Transportation Department has warned contractors that it may have to cancel or renegotiate its contracts as it manages its share of the $85 billion in fiscal year 2013 budget cuts under sequestration.

“We regret the difficult choices we must make, and the impact they could have on your company’s workforce, revenue and planning processes,” it said in a notice obtained by the Washington Business Journal.

“Thank you for your continued partnership with the DOT and for your cooperation as we work together to manage these unfortunate circumstances,” the notice says, according to the report.

DOT could not use option years under existing contracts, suspend or reduce the scope of work or ask for lower contract prices, Jill Aitoro writes.

Aitoro reports that future contracts may have to be rescoped, delayed or canceled.

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