Fixed-Price Award Fee
Also known as
A fixed-price contract with an award fee provision. The contractor earns a base amount plus an additional award fee based on periodic government evaluations of performance against subjective criteria. Used when the government wants to motivate excellent performance through financial incentives beyond the fixed price, particularly for service contracts with quality-dependent outcomes.
Meaning in practice
FP-AF describes how the government structures the work, price, and risk.
Where you’ll see it
You will see it in solicitations, CLIN schedules, pricing tables, and award summaries. Example: FAR 16.404 · moderate risk.
Common confusion
People often confuse a contract type with a vehicle, a task order, or a program name.
What to do next
Check payment timing, scope, and risk allocation before you bid or price the work.
(Fixed-Price Award Fee) is a contract type concept federal contractors and grant writers run into across solicitations, regulations, and award filings
No related questions are available yet.
FP-AF describes a specific contract structure that the federal government uses. For example: FAR 16.404 · moderate risk The contract type controls risk allocation, payment timing, reporting cadence, and how performance is measured — all of which affect whether the work is profitable and whether it fits a contractor's capability profile. Knowing whether a solicitation is structured as a FP-AF versus another vehicle is one of the first signals of how the government expects the work to be executed and what kind of contractor they're trying to attract. Misreading the contract type can mean either over-pricing risk you don't actually carry or under-pricing risk you do. The related terms above name the adjacent vehicles FP-AF most commonly competes with or rolls up under.
Get notified when usage of FP-AF changes in contracts or guidance.
FAR 16.404 · moderate risk
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