Contractor shall notify such third person of the lien herein provided and shall obtain from such third person a receipt, in duplicate, acknowledging, inter alia, the existence of such lien. A copy of each receipt shall be delivered by the Contractor to the Contracting Officer. If this contract is terminated in whole or in part and the Contractor is authorized to sell or retain termination inventory acquired for or allocated to this contract, such sale or retention shall be made only if approved by the Contracting Officer, which approval shall constitute a release of the Government's lien hereunder to the extent that such termination inventory is sold or retained, and to the extent that the proceeds of the sale, or the credit allowed for such retention on the Contractor's termination claim, is applied in reduction of advance payments then outstanding hereunder.

§ 18-1.359 Aircraft noise research and development programs.

NASA and the Department of Transportation have executed an agreement (NMI 1052.103A) to coordinate their research and development efforts in aircraft noise reduction, control, prediction techniques and other aircraft noise related problems. Proposed procurement actions relating to this program will be coordinated with the Deputy Associate Administrator (Aeronautics), NASA Headquarters in accordance with the provisions of NASA Management Instruction 1052.103A.

§ 18-1.361 Contractor cost reduction programs.

Many aerospace contractors conduct independent Cost Reduction Programs similar to the NASA Cost Reduction Program. The cost saving achievements of these programs are of significant benefit to the Government. NASA installations should encourage contractors to report significant cost reductions which are related to individual NASA contracts. NASA Form 1105 or a brief narrative statement may be used by contractors to report cost reduction program achievements. Contractors should forward reports which they desire to be included in the NASA Cost Reduction Report to the President, directly to the Director of Procurement, NASA Headquarters (Code DKP-1).

[39 FR 13075, Apr. 11, 1974]

§ 18-1.362 Cost sharing.

NASA's Appropriation Acts for several years have included provisions requiring cost sharing by the contractor under research contracts resulting from

unsolicited proposals. Office of Management and Budget Circular A-100, dated December 18, 1970, also sets forth circumstances under which cost sharing would be encouraged in certain contracts even when not required by statute. In accordance with the foregoing, and the general NASA policy set forth in NMI 8310.2, "Cost Sharing on Research Grants and Contracts," dated October 20, 1971, the following basic guidelines will be implemented in the negotiation of all research contracts and in supplements to such contracts which require additional funding.

(a) When cost sharing is applicable. (1) Except as provided in paragraph (b) (3) of this section, cost sharing by non-Federal organizations is mandatory in any contract for basic or applied research which results from an unsolicited proposal.

(2) Cost sharing by non-Federal organizations shall be encouraged in any contract for basic or applied research which does not result from an unsolicited proposal but in which the parties nevertheless have considerable mutual interest in the research (e.g., when it is probable that the performing organization or institution will receive significant future benefits from the research, such as: increased technical knowledge useful in future operations; additional technical or scientific expertise or training for its personnel; opportunity to benefit through patent rights; and the use of background knowledge in future production contracts).

(3) Cost sharing by non-Federal organizations which is not otherwise appropriate under subparagraph (1) or (2) of this paragraph (a) may nevertheless be accepted when voluntarily offered by a performing organization.

not

(b) When cost sharing is applicable. (1) Except when cost sharing is mandatory pursuant to paragraph (a) (1) of this section, it is not applicable to contracts which the contracting officer has determined that:

(i) The research effort has only minor relevance to the non-Federal activities of the performing organization, which is proposing to undertake the research primarily as a service to the Government;

(ii) The performing organization has little or no non-Federal sources of funds from which to make a cost contribution;

(iii) The performing organization is predominantly engaged in research and

development and has little or no production or other service activities, and is therefore not in a favorable position to make a cost contribution; or

(iv) Payment of the full cost of the project is necessary in order to obtain the services of the particular organization.

(2) Except when specifically directed by the Procurement Officer of the installation concerned, or when voluntarily offered by the performing organization, cost sharing is not applicable to:

(i) Contracts for projects whose particular research objective or scope of effort is specified by NASA rather than proposed by the performing organization. This will usually include any formal solicitation for a specific contractual requirement.

(ii) Contracts in which the principal purpose is the production of, or design, testing or improvement of products, materials, devices, systems or methods.

(3) Cost sharing is not applicable to contracts for basic or applied research resulting from an unsolicited proposal when the proposer certifies in writing to the contracting officer that it has no commercial, production, educational or service activities on which to use the results of the research; and that it has no means of recovering any cost sharing on such projects. In the foregoing situations, where there is no measurable gain to the performing organization, there is, therefore, no mutuality of interest, and it would not be equitable for the Government to require cost sharing.

(c) Amount of cost sharing.-(1) Educational institutions and affiliated not for profit institutions. Cost sharing for such institutions normally may vary from one percent to as much as five percent of the costs of the project. However, amounts greater than five percent may be accepted when voluntarily offered by the institution.

(2) Other performing organizations. Cost sharing for other organizations may vary from less than one percent to fifty percent or more of the costs of the research.

(3) Additional considerations. (i) The amount of cost sharing which is appropriate in a given instance is independent of whether cost sharing is mandatory or merely encouraged.

(ii) Mutuality of interest in the results of the work being performed should be of primary significance in assessing the appropriateness of any particular level of cost sharing within the foregoing ranges.

(d) Implementation. The following policies and procedures are established to implement the basic guidelines set forth above:

(1) Determining mutuality of interest. Factors which may be considered in determining mutuality of interest include:

(i) The potential of the contractor to recover its contribution from nonFederal sources;

(ii) The extent to which a particular area of research requires special stimulus in the national interest; and

(iii) The extent to which the research effort or result is likely to enhance the contractor's capability, expertise or competitive position.

(2) Payment of fee or profit. (i) When cost sharing is mandatory, normally no fee or profit will be paid to a contractor and only an agreed portion of allowable costs will be reimbursed. However, when required in order to reach agreement, "fee" or "profit" bearing contracts may be awarded provided the "fee" or "profit" is offset by a sharing of allowable costs in excess of such amount; i.e., the contractor's actual allowable direct and indirect costs must exceed, by an amount appropriate for cost sharing, the total payment to the contractor including "fee" or "profit”.

(ii) In contracts subject to encouraged cost sharing the provisions of a. above similarly shall apply, unless the result of the research is expected to be of only minor value to the contractor. In such event, the contractor may make its contribution in the form of a reduction from the fee or profit normally received from such work rather than by sharing in the costs of the work. The amount of any such reduction shall be appropriate to the mutuality of interest of the contractor and NASA in the results of the work.

(3) Method of cost sharing. Cost sharing shall be accomplished by a contribution of part or all of one or more elements of allowable cost of the work being performed, and normally shall be expressed as a stated minimum percentage of the total allowable costs of the project. Costs so contributed may not be charged to the Government under any other grant or contract (including allo

cation to other grants or contracts as part of an independent research and development program).

(4) Institutional cost sharing agreements.—(i) Description. An institutional cost sharing agreement covers the aggregate of all or some of the research projects (both grants and contracts) supported by NASA at a given performing organization. Eligibility for institutional cost sharing agreements is limited to non-profit institutions of higher education and non-profit organizations whose primary purpose is the conduct of scientific research. During the term of such agreements, relatively high contributions by the performing organization on some NASA projects may be offset by relatively low contributions on other NASA projects: Provided, That:

(a) The agreed aggregate contribution is made, and

(b) A contribution, even if nominal, is made to each of the grants and contracts to which the agreement applies.

(ii) Applicability. An institutional cost sharing agreement is entered into only when warranted by a large anticipated volume (normally in excess of $250,000 annually) of contracts and/or grants which will be negotiated with the performing organization during the term of the agreement and will be subject to cost sharing.

(c) Negotiating authority. The Procurement Office, NASA Headquarters (Code DKO-1) is responsible for the negotiation of all institutional cost sharing agreements. Such agreements, when negotiated, shall be used by all procurement offices.

(d) Determination of amount. The amount of cost sharing negotiated under an institutional cost sharing agreement will be determined in accordance with § 18-1.362(c) and should reflect the anticipated mutuality of interest of the parties during the term of the agreement. The average amount of cost sharing under previous grants and contracts with the performing organization may be used as a guide for this purpose to the extent that it is consistent with § 18-1.362(c). When the negotiated amount of cost sharing differs significantly from this average, appropriate explanation should be included in the institutional cost sharing agreement file.

(e) Content. Institutional cost sharing agreements normally shall be executed in the format set forth below. The format may be adapted to fit specific circumstances.

INSTITUTIONAL COST SHARING AGREEMENT BETWEEN THE UNITED STATES OF AMERICA AND

This Agreement is entered into as of the day of 19. between the United States of America, hereinafter called the "Government," represented by the Contracting Officer, and

a corporation organized and existing under the laws of the State of hereinafter called the "Performing Organization."

1. The Performing Organization may, from time to time during the term of this Agreement, perform research under certain NASA grants and contracts (hereinafter referred to as "subject research agreements") pursuant to which the Performing Organization agrees to share the cost of the research in the manner provided in this Agreement.

2. In each year ending during the term of this Agreement, the Performing Organization shall participate in the cost of subject research agreements by contributing, from non-Federal sources, a minimum of percent of the aggregate direct and indirect costs which are otherwise allowable in accordance with the cost principles applicable to the subject research agreements. A nominal portion, at least, of the allowable costs of each individual subject research agreement shall be included in the aforementioned aggregate contribution. 3. The Performing Organization shall maintain records of all costs contributed⚫ pursuant to this Agreement, as well as costs to be paid by the Government. Such records shall be subject to audit by the Government. Costs contributed by the Performing Organization shall not be charged to the Government under any other grant or contract (including allocation to other grants or contracts as part of an independent research and development program).

4. This Agreement may be amended only by mutual agreement of the parties, and may be terminated in its entirety by either party upon thirty (30) days written notice to the other party. Amendment or termination of this Agreement shall not affect any subject research agreement theretofore entered into between the parties.

5. Nothing herein contained shall be construed to imply any agreement on the part of the Government to enter into research agreements with the Performing Organization.

6. This Agreement is effective

and shall remain in effect for a period of three (3) years thereafter unless sooner amended or terminated in accordance with the above.

(5) Contract clauses. The appropriate clause set forth below shall be inserted in each contract in which costs are shared by the contractor pursuant to the policies prescribed above.

(i) In contracts for which cost sharing has been individually negotiated, the following clause shall be used. (The clause may be modified to fit specific circumstances.)

ESTIMATED COST AND COST-SHARING
(MARCH 1972)

(a) It is estimated that the toal cost of performing the work under this contract will be $-

(Insert total estimated cost)

(b) For the performance of the work under this contract the Contractor shall be reimbursed for not more than percent of the costs of performance determined to be allowable in accordance with the Clause of the General Provisions entitled "Allowable Cost percent, and Payment." The remaining or more, of the costs of performance so determined shall constitute the Contractor's share for which it will not be reimbursed by the Government.

(c) For purposes of the clause of the General Provisions entitled "Limitation of Cost" the total estimated cost to the Government is hereby established as $--.

(Insert estimated and this amount is the

Government share) maximum cost for which the Government is obligated.

(d) The Contractor will maintain records of all contract costs claimed by the Contractor as constituting part of its share and such records shall be subject to audit by the Government. Costs contributed by the Contractor shall not be charged to the Government under any other grant or contract (including allocation to other grants or contracts as part of an independent research and development program).

(ii) In contracts for which cost sharing will be in accordance with a previ

ously negotiated institutional agreement, the following clause shall be used:

COST SHARING UNDER INSTITUTIONAL
AGREEMENT (MARCH 1972)

The Contractor agrees to share in the cost of the work hereunder in accordance with Institutional Cost Sharing Agreement No. dated

(6) Documentation. Contract files shall contain appropriate documentation setting forth the nature of the mutual interest of the parties and supporting the amount of cost sharing agreed upon. When cost sharing has been waived pursuant to § 18-1.362(b) (1) (iv), documentation shall include the reason for the contractor's refusal to share the cost of the work, and a justification as to why it is necessary for NASA to obtain the services of the contractor notwithstanding his refusal to share in the costs of the work.

[39 FR 13075, Apr. 11, 1974]

Subpart 18-1.4-Appointment and Authority of Contracting Officers § 18-1.400 Scope of subpart.

This subpart deals with the appointment and procurement authority of contracting officers. It also imposes limitations upon the authority of contracting officers to enter into contracts. For the purpose of this subpart, the term "contracting officer" does not include representatives of the contracting officer.

§ 18-1.401 Authority of

officers.

contracting

Contracting officers are authorized to enter into or modify contracts for supplies or services, including construction, on behalf of the Government and in the name of the United States of America, by formal advertising, negotiation, or by other authorized method of procurement, and to administer such contracts, in accordance with applicable laws and this chapter. The foregoing authorization is subject to the requirements prescribed in § 18-1.402 and any further limitations, consistent with this chapter imposed by the appointing authority.

§ 18-1.402 Requirements to be met before entering into contracts.

(a) General. Whether the procurement is to be effected by formal advertising or by negotiation, a contract or modification may be entered into by a contracting officer only if:

(1) All applicable requirements of law, NASA regulations, and instructions of the installation have been met;

(2) Required approvals have been obtained from the technical and management authorities at the installation concerned; this includes, prior to the incurrence of an obligation, obtaining approval as to the availability of funds; (3) The contract is written on a standard or an approved form of contract; and

of deviations

(4) Approval from standard or authorized contract clauses has been obtained from the Director of Procurement (see § 18-1.109).

(b) Special requirements for negotiated contracts. In addition to the requirements in paragraph (a) of this section, no negotiated contract shall be entered into until the determinations and findings required by Subparts 183.2 and 18-3.3, with respect to the circumstances justifying negotiation and with respect to any use of a special method of contracting have been made. § 18-1.403 Selection, appointment, and termination of appointment of contracting officers.

The selection, appointment and termination of the appointment of contracting officers shall be made only by the Administrator or his designees, and by subsequent designees to whom such authority has been redelegated.

§ 18-1.403-1 Selection.

(a) Considerations. In selecting contracting officers, the appointing authority shall consider experience, training, education, business acumen, judgment, character, reputation and ethics.

(b) Evaluation of experience, training, and education. In considering experience, training, and education, the following shall be evaluated:

(1) Experience in a Government procurement office, commercial procurement, or related fields;

(2) Formal education or special training in business administration, law, accounting, or related fields;

(3) Completion of specialized courses in the field of Government procurement; (4) Knowledge of the provisions of this chapter and of other applicable regulations; and

(5) Where the appointment of contracting officers for construction contracts is involved, experience in the

20-130-745

construction field, including the administration of construction contracts.

§ 18-1.403-2 Appointment.

(a) Except for those individuals who are authorized to enter into contracts by virtue of their position, appointment of contracting officers shall be made on NASA Form 1350, Certificate of Appointment, issued by the appointing official. Any limitations on the scope of the authority to be exercised by the contracting officer, other than those contained in this chapter, shall be entered on the face of the certificate. Certificates may be serially numbered.

(b) The office of each appointing authority shall maintain a file of all documents (such as résumés, references, and records of training) considered in the selection of each contracting officer. § 18-1.403-3

ment.

Termination of appoint

(a) Automatic termination. Unless the Certificate of Appointment of a contracting officer contains other provision for automatic termination, the appointment shall remain in effect, unless sooner revoked, until the contracting officer is reassigned or his employment is terminated.

(b) Revocation. The appointment of a contracting officer may be revoked at any time by the appointing authority, or higher appointing authority, or any successor to either, but no such revocation shall operate retroactively. Revocation of the appointment shall be made by letter, reading substantially as follows: