be negotiated. In the event the letter contract is not negotiated and executed within the 90 days, it shall be terminated unless advance approval to extend the period is obtained from the head of the procuring activity. (4) The maximum monetary liability of the Government stated in the letter contract shall be limited to only that amount determined to be essential to cover the contractor's funding requirements prior to definitization and shall not exceed 50 percent of the total estimated amount of the definitive contract. (5) A letter contract shall not describe, refer to, or otherwise commit the Government to a definitive contract in excess of funds available for obligation or commitment at the time the letter contract is executed. (6) Modifications to letter contracts shall be approved by the head of the procuring activity. (d) Contents. A letter contract and the resulting definitive contract shall contain all applicable provisions required by law and regulation. The letter contract shall be composed of a transmittal letter and signature page, contract terms and conditions, and appropriate general provisions applicable to the dollar range of the procurement and the type of contract. A recommended format for a letter contract transmittal letter and signature page is set forth in paragraph (f) of this section. (e) Definitive contract. (1) The definitive contract resulting from a letter contract shall constitute the entire agreement between the parties. The definitive contract shall replace the letter contract and all modifications thereto and shall contain all letter contract schedule articles, terms and conditions, and general provisions which will continue in effect. (2) The definitive contract number shall be the same as the letter contract number which it replaces. (3) The effective date of the definitive contract shall be the same as the effective date of the letter contract which it replaces, in order to provide continuity for contract administration and audit. Letter Contract No. [Contractor's name and address] Gentlemen: 1. This letter, when accepted by you, will constitute a Letter Contract bearing the contract number shown above, whereby you, as Contractor, agree to furnish to the Government the products or services set forth in the attached contract Schedule in accordance with the terms, conditions and administrative provisions set forth in the Schedule and the General Provisions identified in the Schedule all of which are attached hereto and form a part hereof. The original and * * * copies of this Letter Contract and the Schedule and General Provisions are submitted to you. 2. If you agree to the terms and conditions set forth in the Schedule and General Provisions referenced herein and this letter, please indicate your acceptance by signing the original and - copies in the place proIvided at the end of this letter and return the signed original and copies to the contracting officer who signed this letter on behalf of the United States. The signed copies should be accompanied by evidence of the authority of the person who signed the letter contract. 3. It is understood and agreed by your acceptance hereof that you will promptly enter into negotiations to finalize a definitive contract and to furnish all cost and pricing information requested by the Contracting Officer. The form of contract and provisions of the definitive contract which [41 FR 24586, June 17, 1976] § 14-3.410 Other types of agreements. [41 FR 5282, Feb. 5, 1976] § 14-3.410-2 Basic agreements with educational institutions and nonprofit organizations. (a) This section sets forth information and procedures regarding basic agreements for the procurement of research and development from educational institutions and nonprofit organizations. (b) Procuring activities shall obtain and utilize, to the maximum extent practicable, the basic agreements entered into by both other civilian agenties and the Department of Defense. (c) Procuring activities are responsible for negotiating basic agreements within assigned program responsibilities and within existing delegations of authority. Prior to negotiation of any such basic agreement, the procuring activity shall determine whether an existing basic agreement can be utilized including basic agreements of another procuring activity of the Department or another agency including the Department of Defense. Information concerning basic agreements entered into by other procuring activities of the Department but not included in the consolidated list published in FPR Bulletins, may be obtained from the Chief, Division of Procurement and Grants, Office of Administrative and Management Policy. When requested, each procuring activity shall furnish copies of its basic agreements to other procuring activities and to other agencies including the Department of Defense. (d) Each procuring activity shall furnish an annual report of its effective basic agreements to the Chief, Division of Procurement and Grants, Office of Administrative and Management Policy, within 10 days after September 30 of each year. The report shall state the contractor's name and address, and the number, date, and term of the basic agreement. The reports will be consolidated and reported by the Assistant Director for Procurement in accordance with § 1-3.410-2(d) of this title. [41 FR 5282, Feb. 5, 1976] Subpart 14-3.6-Small Purchases § 14-3.603 Competition. § 14-3.603-1 Solicitation. (a) When written quotations are solicited for small purchases of $5,000 or more, Standard Form 18, Request for Quotation, shall be used (see subpart 1-16.2 of this title). It is not necessary to furnish prospective suppliers a copy to be retained unless requested by a supplier or it is known that a copy is desired. When standard form 18 is used by a purchasing activity, it constitutes merely a request for price quotations and is not an offer to purchase. (b) The instructions set forth in § 14-1.706-5 of this chapter shall be observed to implement the requirements of § 1-1.703-2(g) of this title that the product or service classification and small business size standard shall be set forth in each solicitation of $10,000 or less which is a small business set-aside. (5 U.S.C. 301) [43 FR 39788, Sept. 7, 1978] § 14-3.604 Imprest funds (petty cash) method. § 14-3.604-3 Agency responsibilities. It shall be the responsibility of bureaus and offices to establish appropriate procedures and guidelines for the use, control and safekeeping of imprest funds within their respective organizations. It shall also be the responsibility to review periodically each fund established with a view toward making sure there is a continuing need and that amounts of funds are not in excess of actual requirements. § 14-3.604-4 Use of imprest funds. Imprest funds shall be utilized to the fullest extent practicable for all small purchases of supplies and nonpersonal services. It is essential that authority to make small purchases be at the lowest practical operating level. § 14-3.604-5 Limitations. Small purchases made pursuant to imprest fund procedures may not exceed $300 for any one transaction, except that under emergency conditions the amount of any one transaction may not exceed $500. [46 FR 25618, May 8, 1981] § 14-3.650 Small purchase methods. This section sets forth policies and procedures for small purchase methods which may be used by authorized personnel in procuring activities in addition to the small purchase methods contained in Subpart 1-3.6 of this title. These policies and procedures are designed to expedite small purchases, simplify purchase methods, reduce administrative costs, improve opportunities and lessen paperwork for small business concerns, and reduce costly and time consuming administrative processes. [41 FR 19222, May 11, 1976] § 14-3.650-1 Oral ordering method. The oral ordering method is designed to permit ordering of supplies by authorized procurement personnel, using a requisition form for record purposes, and for delivery by the vendor without the issuance of a confirming written purchase order. (a) Criteria. The oral ordering method may be used when all of the following conditions exist: (1) The authorized procurement official (purchasing agent, procurement clerk, procurement specialist, etc.) de termines that the oral order is the most appropriate method of purchase. (2) The number of line items is small (six or less) and the total amount of the purchase will not exceed $5,000. Orders aggregating more than $5,000 may not be broken down into several orders which are less than $5,000 merely for the purpose of using the oral order method authorized under this § 14-3.650-1. (3) Reasonable competition can be obtained and quotation information is documented as required by § 1-3.603 of this title. (4) A written purchase order is not required by the procuring activity, and the vendor is willing to furnish the supplies without a written confirming purchase order. (5) Detailed specifications or complicated terms and conditions are not required or used. (6) The purchase requirement is not for services, except that minor office machine repairs and work of a similar nature may be procured by oral order method in amounts not to exceed $2,500. (b) Procedures. The procedures used by purchasing offices shall be subject to the criteria set forth in paragraph (a) of this § 14-3.650-1 and the following instructions: (1) The regular requisition form of the procuring activity shall be used to initiate and document such oral order transactions provided it is also identified as an oral order. (2) Instructions beyond those provided in this § 14-3.650-1 to meet the individual requirements of purchasing offices for documentation and distribution of requisition copies for fund obligation, receipt and recording of deliveries, procuring office records, and processing of payments by the fiscal office, shall be provided by the procuring activity. (3) Appropriate internal procedures shall be adopted by the procuring activity for determining and recording the oral order number and date, item descriptions, quantity, unit, unit price, amount, trade discount, f.o.b. point, delivery time, invoice terms, delivery point, and, when applicable, the method of shipment. (4) Multiple oral orders utilizing one requisition shall require separate documentation for each order. (5) Vendors shall be given complete instructions concerning the procedure and specific instructions on invoicing procedures for each oral order transaction. (6) Receipt of deliveries including partial deliveries and complete shipments shall be properly documented. Partial deliveries and discrepancies in shipments shall be reported to, and coordinated by, the purchasing agent, and except under unusual circumstances, should be documented and handled in the same manner as written orders. (5 U.S.C. 301) [41 FR 19222, May 11, 1976, as amended at 46 FR 7985, Jan. 26, 1981] § 14-3.650-2 C.O.D. method. (C.O.D.) The collect-on-delivery method is a combination of the oral ordering method described in § 143.650-1 of this chapter and the imprest funds (petty cash) method prescribed in § 1-3.604 of this title. It is authorized by § 1-3.604-4 of this title and is designed to permit oral ordering of supplies by authorized procurement personnel, using the requisition form of the procuring activity for record purposes; shipment by the vendor without the issuance of a written confirming purchase order; and payment from imprest funds by the purchasing office at the time of delivery. This method can be particularly useful when purchasing from vendors that are located outside the local supply area. (a) Criteria. The C.O.D. method may be used when all of the following conditions exist: (1) The authorized purchasing agent determines that the C.O.D. method is the most appropriate method of purchase. (2) Imprest funds are available at the purchasing office to make payment for the supplies at the time of delivery. (3) The purchase does not exceed the limitations prescribed or otherwise authorized under § 1-3.604-5 of this title. (4) A determination is made and documented at the time of purchase that the price is reasonable, as set forth in § 1-3.603-1 of this title, when competition is not required. (5) A written purchase order is not required by the procuring activity and the vendor is willing to furnish the supplies on a C.O.D. basis without a written confirming purchase order. (6) Detailed specifications or complicated terms and conditions are not required or used. (7) The purchase requirement is not for services, except that minor office machine repairs and work of a similar nature may be procured by this method within the limits set forth in § 1-3.604-5 of this title. (b) Procedures. The procedures used by purchasing offices shall be subject to the criteria set forth in paragraph (a) of this § 14-3.650-2 and the following instructions: (1) The regular requisition form of the procuring activity shall be used to document such C.O.D. transactions, provided it is also identified as a C.O.D. order. (2) Instructions beyond those provided in this § 14-3.650-2 to meet the individual requirements of purchasing offices for documentation and distribution of requisition copies for receipt and recording of deliveries and procuring office records, shall be provided by the procuring activity. Documentation for fund obligation and fiscal purposes is accomplished through the normal imprest fund procedures. (3) Appropriate internal procedures shall be adopted by the procuring activity for determining and recording the C.O.D. order number and date, item descriptions, quantity, unit, unit price, amount, trade discount, delivery time, delivery point, and, when applicable, the method of shipment. A C.O.D. order register shall be established to provide separate control of these orders. (4) Multiple C.O.D. orders utilizing one requisition will require separate documentation for each order. (5) Vendors shall be given complete instructions concerning the C.O.D. ordering method and specific instructions to include with each C.O.D. shipment a priced packing list or invoice. (6) Receipt of deliveries, including partial deliveries and complete shipments shall be properly documented. Partial deliveries and discrepancies in shipments shall be reported to, and coordinated by, the purchasing agent. (7) Payment shall be made from the imprest fund at the time of delivery. The imprest fund voucher number shall be recorded on the requisition document and the packing list or invoice which accompanies the shipment. All other requirements for payments from imprest funds shall be observed. [41 FR 19222, May 11, 1976; 41 FR 20548, May 19, 1976] Subpart 14-3.8-Price Negotiation Policies and Techniques § 14-3.809 Contract audit as a pricing aid. Departmental requirements and instructions pertaining to audit of proposals, contracts and modifications and prescribed contract clauses are contained in Subpart 14-63.1 of this chapter. (See also Part 360 of Department Manual.) [40 FR 10468, Mar. 6, 1975] Subpart 14-3.12-Cost Accounting Standards SOURCE: 40 FR 40517, Sept. 3, 1975, unless otherwise noted. § 14-3.1203 Prime contractor Disclosure Statement(s). Determinations and findings by the head of the agency under § 1-3.1203(e) of this title that it is impractical to secure Disclosure Statement(s) in accordance with the clause entitled "Cost Accounting Standards" as set forth in § 1-3.1204 of this title, will be signed by the Assistant SecretaryPolicy, Budget and Administration. § 14-3.1208 Contract administration for CASB matters by other Government agencies other than DOD. The designation of cognizant contracting officers for CASB matters within Interior pursuant to § 13.1208(b) of this title will be made by the Chief, Division of Procurement and Grants, Office of Administrative and Management Policy. [40 FR 40517, Sept. 3, 1975; 40 FR 47136, Oct. 8, 1975] § 14-3.1210 Cost Accounting Standards Board Report. Each bureau and office shall collect, consolidate and submit to the Chief, Division of Procurement and Grants, Office of Administrative and Management Policy, within 90 days after the close of each calendar year, the information required by Paragraph (c)(8) of § 1-3.1210 of this title. Cognizant contracting officers for CASB matters (if any) in each bureau or office are required to collect and report all information required by paragraph (c) of § 1-3.1210 of this title. The Assistant Director for Procurement, Office of Management Services, shall consolidate the information collected and submit the annual report to CASB. § 14-3.1211 Waiver of cost accounting standards, rules and regulations. Each request for approval of a proposed waiver of all or any part of the provisions of the clause entitled "Cost Accounting Standards" (as set forth in § 1-3.1204 of this title) with respect to nondefense contracts shall be prepared and signed by the contracting officer after he has determined that it is impractical to obtain the materials, supplies, or services from any other source. This determination, and the documentation required by § 1-3.1211 of this title, shall be submitted through the Chief, Division of Procurement and Grants, Office of Administrative and Management Policy, to the Assistant Secretary-Policy, Budget and Administration for approval. A waiver with respect to national defense contracts will require approval of the CASB pursuant to § 13.1211 of this title. |