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Subpart M of this part), and those listed below:

(1) Urgency of need for the supplies

or services;

(2) Production time (quantity, complexity of design, etc.);

(3) Market conditions;
(4) Transportation time;
(5) Industry practices;

(6) Capabilities of small business concerns;

(7) Time for obtaining and evaluating bids or offers, and awarding contracts.

(8) Time for contractors to comply with any conditions precedent to contract performance; and

(9) Time for Government to perform its obligations under the contract (e.g., furnishing Government property to the contractor, approval of preproduction samples, and inspection).

(b) Where timely delivery or performance is unusually important to the Government, liquidated damages provisions may be used as provided in § 1.310.

(c) Invitations for bids and requests for proposals shall, except where clearly unnecessary, inform bidders or offerors of the basis on which their bids or proposals will be evaluated with respect to time of delivery or performance.

[25 F.R. 14083, Dec. 31, 1960, as amended at 29 F.R. 11809, Aug. 19, 1964]

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(a) Delivery schedules may be expressed in terms of:

(1) Specific calendar dates (e.g., on or before July 1, 1960);

(2) Specified periods from date of contract (i.e., date of award or acceptance by the Government, or date shown on contract document as effective date of contract); or

(3) Specified periods from date of receipt by contractor of notice of award or acceptance by the Government (including notice by receipt of contract document executed by the Government). The full period which the Government holds out as being available for contract performance should not be curtailed to the prejudice of the contractor by delay in giving notice of award. Accordingly, one of the provisions in paragraph (b) or (c) of this section shall be used in advertised procurements and may be suitability modified and used in appro

priate negotiated procurements (other than small purchases).

(b) Where the delivery schedule is in terms of specific calendar dates, invitations for bids will include one of the following provisions:

(1) The foregoing delivery requirements are based on the assumption that the Government will make award by [purchasing activity insert calendar date]. Each delivery date in the delivery schedule set forth herein will be extended by the number of calendar days after the above date that the contract is in fact awarded. Attention is directed to paragraph 8(d) of the Terms and Conditions of the Invitation for Bids, which provides that a written award mailed or otherwise furnished to the successful bidder results in a binding contract. Therefore, in computing the available time for performance, the bidder should take into consideration the time required for notice of award to arrive through the ordinary mails.

(2) The foregoing delivery requirements are based on the assumption that the successful bidder will receive the notice of award by [purchasing activity insert calendar date]. The Government will extend each delivery date in the delivery schedule set forth herein by the number of calendar days after the above date that the contractor receives notice of award: provided, that the contractor promptly acknowledges such receipt.

(c) Where the delivery schedule is based on the date of contract (see paragraph (a)(2) of this section), the invitations for bids will include the following provision:

Attention is directed to paragraph 8(d) of the Terms and Conditions of the Invitation for Bids which provides that a written award mailed or otherwise furnished to the successful bidder results in a binding contract. Any award hereunder, or a preliminary notice thereof, will be mailed or otherwise furnished to the bidder the day the award is dated. Therefore, in computing the time || available for performance, the bidder should take into consideration the time required for the notice of award to arrive through the ordinary mails. However, a bid offering delivery based on date of receipt by the contractor of the contract or notice of award (rather than the contract date) will be evaluated by adding the maximum number of days normally required for delivery of the award through the ordinary mails. If, as so computed, the delivery date offered is later than the delivery date required in the invitation, the bid will be considered nonresponsive and rejected.

(d) Where the delivery schedule is based on the date of the contract (see paragraphs (a) (2) and (c) of this sec

tion), the contract, notice of award, acceptance of proposal, or other contract document executed by the Government shall be mailed or otherwise furnished the contractor on the day it is dated.

(e) Where the delivery schedule is based on date of receipt by the contractor of notice of award (see paragraph (a) (3) of this section), or where it is expressed in terms of specific calendar dates on the assumption that notice of award will be received by a specified date (see paragraph (b)(2) of this section), the notice of award, acceptance of proposal, or other contract document executed by the Government shall be sent by certified mail, return receipt requested, or shall be accompanied by a date of receipt acknowledgment card in accordance with Departmental procedures.

(f) When the required delivery schedule in the invitation for bids is based on the date of the contract (see paragraph (a) (2) of this section), a bid offering delivery based on date of receipt by the contractor of the contract or notice of award (see paragraph (a) (3) of this section):

(1) Shall be evaluated by adding the maximum number of days normally required for delivery of the award through the ordinary mails; and

(2) If the delivery date offered by the bid (computed in accordance with subparagraph (1) of this paragraph is later than the delivery date required in the invitation for bids, the bid shall be considered nonresponsive and rejected; but (3) If award is made under subparagraph (1) of this paragraph, under the terms of the contract the delivery date will be the number of days, after actual receipt by the contractor of the notice of award, which were specified in the bid. [25 F.R. 14083, Dec. 31, 1960]

§ 1.305-4 Time of delivery clauses.

(a) Examples of time of delivery clauses for invitations for bids are set forth below. They may be modified or other clauses may be used to state particular delivery requirements or any special procedures to be used in the evaluation, rejection or award process as regards time of delivery. These clauses also may be suitably modified for use in negotiated procurements where appropriate.

(b) The following clause may be used where delivery by a particular time is

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Bids offering delivery of each quantity within the applicable delivery period specifled above will be evaluated equally as regards time of delivery. Bids offering delivery of a quantity under such terms or conditions that delivery will not clearly fall within the applicable delivery period specified above will be considered nonresponsive and will be rejected. Where a bidder offers an earlier delivery schedule than that called for above, the Government reserves the right to award either in accordance with the REQUIRED schedule or in accordance with the schedule offered by the bidder. If the bidder offers no other delivery schedule, the delivery schedule stated above shall apply.

BIDDER'S PROPOSED DELIVERY SCHEDULE
(To be completed by bidder)
Quantity

Item No.

Time [*]

*Contracting officer shall insert the appropriate one of the following phrases, in both of the indicated spaces:

1. "[On] (on or before) the date(s) specifiled below."

2. "Within the number of days stated below after date of contract."

3. "Within the number of days stated below after the date of receipt of a written notice of award."

4. "Within the periods specified below." (NOTE: When this phrase is inserted, the wording "during month(s) of or "not sooner than than

the periods.

--- and not later "should be used to specify

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Phrases for insertion as indicated above:

1. "[On] (on or before) the date(s) specifiled below."

2. "Within the number of days stated below after date of contract."

3. "Within the number of days stated below after the date of receipt of a written notice of award."

4. "Within the periods specified below." (NOTE: When this phrase is inserted, the wording "during the month(s) of or "not sooner than than

the periods.)

and not later "should be used to specify

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(a) DOD Priorities and Allocation Manual. Department of Defense imple mentation of all rules and regulation published by the Business and Defens Services Administration, with respect t which the Department of Defense is del egated administrative responsibility, wil be published in the Priorities and Allo cations Manual promulgated by Depart ment of Defense Instruction 4410.1. Au thorized deviations to the priorities an allocations rules and regulations wil likewise be published in the Manual.

(b) Operating responsibility. In ac cordance with § 1.403 (a), the Depart ments shall comply with the prioritie and allocations program, including the Defense Materials System, as set forth in the Priorities and Allocations Manua and in the rules and regulations pub lished by the Business and Defense Serv ices Administration.

[25 F.R. 14084, Dec. 31, 1960]

§ 1.307-2

Required use of priorities allocations, and allotments clause. The contract clause set forth in § 7.104-18 of this chapter shall be inserted in or attached to all rateable contracts, except that no such clause need be attached to purchase orders of less than $500 which are not rated. Rateable contracts are those contracts for supplies which are required to be supported with rating and allotment authority (see Priorities and Allocations Manual, section 2-1).

[26 F.R. 2599, Mar. 28, 1961]

§ 1.308 Records of contract actions.

(a) Each contract file shall contain documentation of actions taken with respect to the contract, including final disposition, sufficient to constitute a full history of the transaction, to permit ready reconstruction of all of the stages of the transaction to (1) support actions taken by various personnel in the procurement cycle, (2) provide information for reviews conducted by the Department concerned, the Department of Defense, the General Accounting Office, or others, (3) supply data for use in preparing replies to Congressional inquiries, and (4) furnish essential facts in the event of litigation. To the extent that retained copies of documents do not represent all actions taken, suitable memoranda or summary statements of undocumented actions should be prepared promptly and be retained in the contract file in chronological order.

(b) Each contract file shall include the following data, if applicable:

(1) a copy of the procurement directives or request, or appropriate reference thereto;

(2) On negotiated procurement, the original or a copy of the Determination and Findings and any request for authority to negotiate;

(3) The list of sources solicited or justification for limiting such sources and a list of any firms or persons whose requests for copies of the solicitation were denied, together with the reasons for denial;

(4) Any small business or labor surplus set-aside determinations

$1.706 and 1.804):

(see

(5) A copy of the Invitation for Bids or the Request for Proposals, including the drawings and specifications or an identifiable reference thereto;

(6) The Security Requirements Check List (DD Form 254) (see § 16.811 of this _chapter);

(7) One copy of each signed bid or proposal received, together with an abstract of bids or proposals received (With respect to formally advertised procurements, unsuccessful bids may be removed and destroyed either after one year from date of award of the contract or after final payment has been made, whichever occurs later. However, in no event will such bids be destroyed prior to final resolution of any protest or complaint submitted by an unsuccessful bidder. Furthermore, when the contracting officer determines that technical data contained in an unsuccessful bid are of sufficient value to the Government or could be reasonably considered of value to the Government in the future, such bid shall be retained.);

(8) The bidders' Statements of Contingent Fees (see § 16.802 of this

chapter);

(9) All §1.905-4);

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(10) Selection of the successful contractor, including:

(i) The reasons for selection, (ii) The contracting officer's determination of the contractor's responsibil(see 1.904-1);

(ii) Any Small Business Administration Certificate of Competency (see 1.705-4);

(11) All price and cost data submitted or used, including Certificates of Current Cost or Pricing Data (see §§ 2.102-1(b), 3.807-3, and 3.807-4 of this chapter);

(12) A full record of negotiations, including but not limited to: participants; dates of meetings or phone calls; Government-furnished materials or facilities provided; subcontracting; terms and conditions agreed to; deviations, if any, from prescribed contract clauses; technical recommendations; and justification for final price;

(13) Justification for type of contract used (see § 3.303 of this chapter);

(14) Any exceptions or exemptions from the Buy American Act or appropriations act restrictions (see Part 6 of this chapter);

(15) A copy of contract or award; (16) Required approvals of award; (17) A copy of Individual Procurement Action Report (DD Form 350);

(18) A copy of Statement and Certificate of Award (SF 1036) (see § 16.801 of this chapter);

(19) All pertinent correspondence;

(20) Copies of all change orders, and supplements, with supporting documents;

(21) Comprehensive termination data; (22) Copies of royalty reports received (see § 16.806 of this chapter);

(23) Final release upon completion of the contract; and

(24) Information appropriate for renegotiation purposes (see § 1.319); and (25) any additional documents reflecting actions peculiar to a specific activity or service.

(c) Complete record of all negotiated contract actions, including unsuccessful proposals, shall be preserved in the cognizant procuring activity or in the Department concerned for a period of six years following final payment on each contract.

(d) This section does not apply in the case of small purchases (see § 3.604 of this chapter).

[25 F.R. 14084, Dec. 31, 1960, as amended at 27 F.R. 3443, Apr. 11, 1962; 27 F.R. 6120, June 29, 1962; 27 F.R. 11644, Nov. 27, 1962; 28 F.R. 2093, Mar. 5, 1963; 28 F.R. 2572, Mar. 16, 1963; 28 F.R. 12546, Nov. 23, 1963; 29 F.R. 11809, Aug. 19, 1964; 30 F.R. 5961, Apr. 29, 1965] § 1.309 Solicitations for informational

or planning purposes.

It is the general policy of the Department of Defense to solicit bids, proposals or quotations only where there is a definite intention to award a contract or purchase order. However, in some cases solicitation for informational or planning purposes may be justified. Invitations for bids and requests for proposals

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will not be used for this purpose. quests for quotations may be issued for informational or planning purposes only with prior approval of an individual at a level higher than the contracting officer. In such cases, the request for quotation shall clearly state its purpose and, in addition, the following statement in capital letters shall be placed on the face of the request: THE GOVERNMENT DOES NOT INTEND TO AWARD A CONTRACT ON THE BASIS OF THIS REQUEST FOR QUOTATION, OR OTHERWISE PAY FOR THE INFORMATION SOLICITED. The foregoing does not prohibit the allowance, in accordance with § 15.205-3 of this chapter, of the cost of preparing such quotations.

[26 F.R. 2599, Mar. 28, 1961]

§ 1.310 Liquidated damages.

(a) This section applies to procurement by formal advertising and procurement by negotiation. Liquidated damages provisions normally will not be utilized but may be used where both (1) the time of delivery or performance is such an important factor in the award of the contract that the Government may reasonably expect to suffer damages if the delivery or performance is delinquent, and (2) the extent or amount of such damages would be difficult or impossible of ascertainment or proof. Where a liquidated damages provision is to be used in a supply or service contract, insert the provision set forth in § 7.105-5 of this chapter in accordance with the instructions thereof. Liquidated damages provisions for construction contracts are covered by §§ 18.113, 7.603-39 and 8.709 of this chapter.

(b) The rate of assessment of liquidated damages must be reasonable, considered in the light of procurement requirements on a case-by-case basis, since liquidated damages fixed without reference to probable actual damages may be held to be a penalty and therefore unenforceable.

(c) The law imposes the duty upon a party injured by another to mitigate the damages which result from such wrongful action. Therefore, where a liquidated damages provision is included in a contract and a basis for termination for default exists, appropriate action should be taken expeditiously by the Government to obtain performance by the contractor or to terminate the contract. If delivery or performance is desired after termination for default, efforts must be made to obtain either de

livery or performance elsewhere with a reasonable time. For these reason particularly close administration ov contracts containing liquidated damag provisions is imperative.

(d) Whenever any contract includes provision for liquidated damages for d lay, the Comptroller General on th recommendation of the Secretary co cerned is authorized and empowered remit the whole or any part of sud damages as in his discretion may be ju and equitable. Accordingly, recom mendations concerning such remission may be transmitted to the Secretar concerned in accordance with Depar mental procedures.

[25 F.R. 14085, Dec. 31, 1960, as amended 30 F.R. 5961, Apr. 29, 1965]

§ 1.311 "Buying In”.

"Buying in" refers to the practice attempting in procurements involvin price competition, to obtain a contrac award by knowingly offering a price les than anticipated costs with the expecta tion of either (a) increasing the contrac price during the period of performand through change orders or other mean or (b) receiving future "follow-on" con tracts at prices high enough to recove any losses on the original "buy-in" con tract. Such a practice is not favored b the Department of Defense since its long term effects may diminish competitio and it may result in poor contract per formance. Where there is reason to be lieve that "buying in" has occurred, con tracting officers shall assure tha amounts thereby excluded in the develop ment of the original contract price ar not recovered in the pricing of chang orders or of follow-on procurements sub ject to cost analysis.

[29 F.R. 9747, July 21, 1964]

§ 1.312 Voluntary refunds.

(a) General. A voluntary refund is payment or credit, not required by an contractual or other legal obligation made to the Government by a contracto or subcontractor either as a payment o as an adjustment under one or mor contracts or subcontracts. It may be un solicited or it may be made in respons to a request by the Government. Wher it is desired to solicit a voluntary refun from a subcontractor, the prime con tractor should be encouraged to facili tate the making of such refund. I deciding whether to solicit a voluntar refund or to accept an unsolicited re

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