Originally Posted by CAcop
Would you as a business owner ever do work for the government knowing they can cancel your contract without having to pay you?
I ask because CalTrans does not build roads. They hire private companies to do that. Would anyone take on roadbuilding if they knew the government could pass a law forbiding payment for that work?
I also negotiate multiyear contracts with government entities. We have special contracts and terms for them (which are basically THEIR contracts and terms). Without fail every single one of them has an annual out clause because it is contingent on the government body appropriating the money to satisfy the terms of the contract.
This is standard stuff.
Now, what we know is that because most governments employ some form of baseline budgeting, the chances of it not getting funded are low. Nonetheless it is a risk.
Apparently the only folks who think the government can't choose not to pay on any given year are those who expect a pension, salary or welfare (Social Security, Medicare, Housing) check.