14H-30.411 Application for advance payment.

14H-30.412 Action by contracting officer. 14H-30.414 Agreement for special bank account and contract provisions. 14H-30.414-1 Form of agreement for special bank account.

14H-30.414-2 Contract provisions for advance payments.

AUTHORITY. Act of November 2, 1921, Ch. 115, 42 Stat. 208 (25 U.S.C. 13); 41 CFR 141.008; sec. 23, Act of June 25, 1910 (36 Stat. 861, as amended; 25 U.S.C. 47).

SOURCE: 40 FR 12503, Mar. 19, 1975, unless otherwise noted.

Advance payments made under nonprofit contracts to Indian tribal contractors, individual Indians and other Indian organizations will not require the payment of interest.

§ 14H-30.404 Standards-amounts-need.

An advance payment to an Indian tribal contractor, as defined in § 14H1.270-4, is an exception under § 130.404(b).

§ 14H-30.406 Responsibility-delegation of authority.

Authority to make advance payments not to exceed $250,000 to Indian tribal contractors and other Indians who operate a totally Indian owned and controlled non-profit business and who qualify for contracts with the Bureau of Indian Affairs shall be exercised by the Area Directors. Advance payments shall be made based upon written findings, determinations and authority as provided for in § 1-30.405 that the making of the advance payments is in the public interest and that adequate financing cannot be obtained elsewhere. The advance payment clause in § 14H-30.414-2 shall be

1. I hereby find that:

a. The Bureau of Indian Affairs has entered (intends to enter) into a contract as indicated below. (Use appropriate language). Type of Contract: (Indicate type). Amount of Contract: (State amount). Contractor: (Indicate name of contractor). Purpose: (Give description of contract). Contracting Office: (Give name of contracting office).

b. (Note to Contracting Officer: Summarize the specific facts and significant circumstances concerning the contract and the contractor, which, together with the other findings, will clearly support the determination below).

c. An advance payment has been requested by the contractor and is required for prompt and efficient performance of the services under this contract which will be of benefit to the Bureau. No means of adequate financing other than by an advance payment are available to the Contractor.

d. The attached advance payment clause that will be included in the contract contains appropriate provisions for the protection of the Government as security for the advance payment. These include provisions that the advance payment(s), and all progress and final contract payments made, will be deposited in a special bank account, and that the Government will have a paramount lien upon (1) the credit balance in the special bank account, (2) any supplies contracted for, and (3) any material or property acquired for the performance of the contract.

e. The security provisions of the advance payment clause that will be used are deemed adequate.

f. Because of the lack of financial resources, the Contractor is not in a position

to pay interest and it should not be charged on the advance payment(s).

g. The Bureau is committed to help develop Indian organizations to attain financial and managerial viability.

DETERMINATIONS

2. Upon the foregoing findings, I hereby determine that the making of an advance payment(s) without payment of interest, except as provided in the attached advance payment clause that will be included in the contract, is in the public interest.

AUTHORIZATION

Upon the findings and determination stated above, an advance payment not to exceed the amount stated below is hereby authorized pursuant to 41 U.S.C. 255 upon terms and conditions as contained in the advance payment clause to be included in the contract, a copy of which is attached thereto. The amount of the advance payment(s), at any time outstanding, shall not exceed the unpaid contract price nor the contractor's estimated interim needs arising during the reimbursement cycle. Amount of advance payment shall not exceed thirty (30) percent of the contract amount including any modification.

Signature: Title: Date:

§ 14H-30.411 Application for advance payment.

Paragraphs (a), (d), and (e) of § 130.411 are optional with the contracting officer when contracting with an Indian tribal contractor pursuant to Subpart 14H-3.2.

§ 14H-30.412 Action by contracting offi

cer.

Paragraphs (c) and (d) of § 1-30.412 are optional with the contracting officer when contracting with an Indian tribal contractor pursuant to Subpart 14H-3.2.

§ 14H-30.414 Agreement for special bank account and contract provisions.

8 14H-30.414-1 Form of agreement for special bank account.

For all advance payments made to Indian tribal contractors and other Indians who operate a totally owned and controlled non-profit business, the form of agreement and modification

given in paragraphs (a)–(d) of this section should be used.

(a) The following is the form of agreement for a special bank account for advance payments:

AGREEMENT FOR SPECIAL BANK ACCOUNT FOR ADVANCE PAYMENT(S)

(1) This agreement entered into between the United States of America, hereinafter called the "Government," Contractor, and Bank, each represented by the officials executing this agreement.

(2) The Government and the Contractor entered into the Contract(s) or Supplemental Agreement(s) thereto, providing for the making of advance payment(s) to the Contractor. Copy of the advance payment clause included in the contract is attached to and made a part of this agreement.

(i) The advance payment clause requires that amounts advanced to the Contractor be deposited in a Special Bank Account at a member bank or banks of the Federal Reserve System or any "insured" bank within the meaning of the Act creating the Federal Deposit Insurance Corporation (Act of August 23, 1935; 49 Stat. 684, as amended; 12 U.S.C. 264), separate from the Contractor's general or other funds; and, the Bank being such a bank, the parties are agreeable to so depositing said amounts with the Bank.

(ii) This Special Bank Account shall be designated as indicated in paragraph (7) of this agreement.

(3) In consideration of the foregoing, and for other good and valuable considerations, it is agreed that:

(i) The Government shall have a lien upon the credit balance in said account to secure the repayment of all advance payments made to the Contractor, which lien shall be superior to any lien or claim of the bank with respect to such account.

(ii) The Bank will be bound by the provisions of the advance payment clause relating to the deposit in and withdrawal of funds from the Special Bank Account, but shall not be responsible for the use of funds withdrawn from said account. Upon receipt by the Bank of written directions of any kind from the Contracting Officer, or from the duly authorized representative of the Contracting Office, pertaining to the use of the funds in the Special Bank Account upon Department of the Interior, Bureau of Indian Affairs stationery and purporting to be signed by the Contracting Officer or the Contracting Officer's authorized representative, the Bank shall act thereon and insofar as the rights, duties, and liabilities of the Bank are concerned, the written directions shall be conclusively deemed to have been properly issued and filed with the Bank by the Department of the Interior, Bureau of Indian Affairs.

(iii) The Government, or its authorized representatives, shall have access to the books and records maintained by the Bank with respect to the Special Bank Account at all reasonable times and for all reasonable purposes, including (but without limiting the generality thereof) the inspection or copying of such books and records and any and all memoranda, checks, correspondence or documents appertaining thereto. Such books and records shall be preserved by the Bank for a period of six (6) years after the closing of the Special Bank Account.

(4) In the event of the service of any writ of attachment, levy of execution, or commencement of garnishment proceedings with respect to the Special Bank Account, the Bank will promptly notify the Contracting Officer.

(5) The Bank, Contractor, and Government, by executing this agreement, are bound by all of the provisions contained in the advance payment clause attached, which is made a part of the contract.

(b) The following instructions apply to the form of agreement shown in paragraph (a) of this section:

(1) Under paragraph (6) of the agreement, state the contract number and describe the purpose of the contract in brief but sufficient detail to convey a general understanding of its nature. If the contract uses a descriptive title to designate its purpose, that description should be used.

(2) Insert, in the blank space in paragraph (7) of the agreement, the number assigned by the Bank as the Account Number for the "Special Bank Account."

(3) The agreement should be dated on the date it is signed by the Contracting Officer.

(4) The complete mailing address of the bank is necessary as the advance payment check and all progress payment checks will be mailed to the bank. The zip code is required.

(5) The Contracting Officer should not sign the agreement until authority to make the advance payment has been obtained.

(c) The following is the form of modification of an agreement for a special bank account for advance payments:

AGREEMENT FOR SPECIAL BANK ACCOUNT

Modification Number

(1) The Agreement for Special Bank Account dated --, 19— is modified as follows:

(2) The contract number and the purpose of the contract is as follows:

UNITED STATES OF AMERICA
Acting Through the Bureau of Indian
Affairs

Signature
By (Name and title of Contracting Officer)

(d) The following instructions apply to the form of modification of an agreement shown in paragraph (c) of this section:

(1) The date of the original Agreement for Special Bank Account should be indicated in the first line of paragraph (1) of the modification.

(2) Under paragraph (2) of the modification, state the contract number and describe the purpose of the contract. If the purpose given in paragraph (6) of the original agreement is changed, describe it. Otherwise repeat the original description.

(3) Under paragraph (3) of the modification, indicate the Special Bank Account Number if a new one is being issued. If the original number is being used, repeat it.

(4) If a change is not made under either paragraphs (2) or (3) of the modification, then no modification of the original agreement is necessary.

(5) If a modification is required, it should be dated when signed by the Contracting Officer.

made on a contract with an Indian tribal contractor and other Indians who operate a totally Indian owned and controlled business follows:

ADVANCE PAYMENT

(a) Amount of advance. At the request of the Contractor, and subject to the conditions hereinafter set forth, the Government shall make an advance payment(s) to the Contractor. No advance payment(s) shall be made (1) without the Contracting Officer's approval as to the financial necessity therefor; and (2) in an amount in excess of that stated in paragraph (n)(1) hereof.

(b) Special bank account. Until the advance payment(s) made hereunder is liquidated and the Contracting Officer approves in writing the release of any funds due and payable to the Contractor, the advance payment(s) and all other payments (progress, partial, and final) made under the contract shall be made by check payable to the Contractor but mailed to the bank, where the special bank account is maintained as stated in the Agreement for Special Bank Account. The check must be marked for "Deposit in Special Bank Account Number--Bureau of Indian Affairs." The Agreement for Special Bank Account shall designate the account number. No part of the funds deposited in the Special Bank Account shall be mingled with other funds of the Contractor prior to withdrawal thereof from the Special Bank Account as hereinafter provided. Except as hereinafter provided, each withdrawal shall be only by check of the Contractor, unless countersigning on behalf of the Government by the Contracting Officer or such other person as he may designate in writing is determined to be in the best interest of the Government and the Contracting Officer notifies the Contractor and bank in writing that countersigning will be required.

of

(c) Use of funds. The funds in the Special Bank Account may be withdrawn by the Contractor solely for the purposes making payments for materials, labor, administrative and overhead expenses, and other purposes required for this contract (including, without limitation, payments incident to termination for the convenience of the Government) and properly allocable thereto in accordance with generally accepted accounting principles (subject to any applicable provision of contract cost principles and procedures in 41 CFR Part 1-15 or other agency cost principles and procedures, if any, which are made part of this contract), or for the purposes of reimbursing the Contractor for such payments, and for such other purposes as the Contracting Officer may approve in writing. If this is a cost reimbursement contract, the funds in the Special Bank Account may be withdrawn by

the Contractor solely for the purpose of making payments for items of allowable costs as defined in clause titled "ALLOWABLE COST, FIXED-FEE AND PAYMENT" of this contract. Any interpretation required as to the proper use of funds shall be made in writing by the Contracting Offi

cer.

(d) Return of funds. The Contractor may at any time repay all or any part of the funds advanced hereunder. Whenever so requested in writing by the Contracting Officer, the Contractor shall repay to the Government such part of the unliquidated balance of the advance payment as shall in the opinion of the Contracting Officer be in excess of the Contractor's current requirements or when added to total advances previously made and liquidated are in excess of the amount specified in paragraph (n)(1) hereof or are no longer to be made available to the Contractor because of default, or abuse in their use, or for such other reasons as the Contracting Officer may specify. In the event the Contractor fails to repay such part of the unliquidated balance of the advance payment when so requested by the Contracting Officer, all or any part thereof may be withdrawn from the Special Bank Account by check(s) made payable to the Bureau of Indian Affairs signed by the Contracting Officer or by an official of the Bureau of Indian Affairs authorized in writing by the Contracting Officer to take such action. Such withdrawals shall be applied in reduction of the advance payment(s) then outstanding hereunder. The Contracting Officer shall notify the contractor and the bank of the action taken.

(e) Liquidation. If not otherwise liquidated, the advance payment(s) made hereunder shall be liquidated as herein provided. When the sum of all the estimated payments remaining due on the contract approximate the unliquidated amount of the advance payment(s), the Contracting Officer shall thereafter withhold further payments due on the Contract represented by proper invoiced amount(s) submitted by the Contractor, and apply the amount(s) withheld against the liquidation of the advance payment until the advance payment has been fully liquidated. If, upon completion or termination of the contract or for other reasons, the entire advance payment(s) is not fully liquidated by the process indicated above and the Contractor does not repay the balance due upon request, then the balance thereof shall be offset against any sums otherwise due or which may become due to the Contractor from the Government on any other contracts or from any source.

(f) Interest charge. No interest will be charged on the amount of the advance payment(s), but any interest earned on the advance payment(s) including sub-advances