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Term

Option year

An additional year of work the government can choose to add onto a contract, at its discretion, not yours.

Many federal contracts are structured as a base year plus several option years, and the government decides, usually annually, whether to exercise the next one. Winning the base year is not winning all of them; a poor performance record, a budget cut, or a change in need can end the relationship at any option point. Treat every option year as something you re-earn through performance, not something already banked.

In a sentence

"This is a one-year base contract with four one-year options." Up to five years of work is possible, but only the base year is guaranteed; the rest depends on you performing well and the agency still having the money and the need.

Also called

  • contract option
  • base year plus options
  • option period

Terms like this show up in every federal notice. We translate them in place, on every notice in your trade.