XL EagleNTE (Not-to-Exceed)
NTE stands for Not-to-Exceed. A not-to-exceed amount is a hard cap on what the government will pay for a piece of work. It is common on T&M orders, emergency work and undefinitized contract actions where the final price is not set yet.
You cannot be paid above the NTE unless the contracting officer formally raises it. If you are getting close, you must notify the government before going over.
Why it matters to a small contractor
Track spending against the NTE every week. Going over without written approval usually means working for free.
Example
An emergency HVAC repair order has a $12,000 NTE. At $10,500 the tech finds another failed part and calls the contracting officer before ordering it.
NTE: common questions
Is NTE the same as ceiling price?
They are close. Ceiling price is usually a formal contract term on T&M or incentive contracts. NTE is a broader everyday term for a cap.
What if the job is done under the NTE?
You bill only what you actually earned, not the full NTE.
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