Government or acquired by the Government under the terms of a contract. Government property includes both Government-furnished property and contractor-acquired property as defined below:

(a) Government-furnished property is property in the possession of, or acquired directly by, the Government and subsequently delivered or otherwise made available to the contractor; and

(b) Contractor-acquired property is property procured or otherwise made available by the contractor for performance of a contract, title to which is vested in the Government.

§ 15-60.101-3 Provide.

Provide means to furnish Government-owned property or to allow a contractor to acquire property at Government expense.

§ 15-60.101-4 Nonseverable.

Nonseverable, when related to Government property, means that such property cannot be removed after erection or installation without substantial loss of value or damage thereto, or to the premises where installed. § 15-60.101-5 Dollar value.

This is the amount determined by the Government and recorded in inventory records as the price or cost of an item of Government-owned property.

§ 15-60.101-6 Procurement contract.

Procurement contract means a Government contract for the acquisition of property or services of any description; e.g., research and development, construction, scientific, educational, medical, etc.

815-60.101-7 Material.

Material means property which may be consumed or expended in the performance of a contract or which may be incorporated into or attached to an end item to be delivered under a contract. It includes, but is not limited to raw and processed material, parts, components, assemblies, small tools and supplies which may be consumed

in normal use during performance of a contract.

§ 15-60.101-8 Nonprofit organization.

Nonprofit organization means any corporation, foundation, trust, or institution operated for scientific, educational, or medical purposes, not organized for profit, no part of the net earnings of which inures to the benefit of any private shareholder or individual.

§ 15-60.102 Responsibility and liability for Government property.

§ 15-60.102-1 Prime contractors.

Except for the conditions specified in paragraph (g) of the Government Property clauses set out in FPR 17.203-21(a), 1-7.303-7(a), 1-7.303-7(d), and 1-7.402-25(b), it is EPA policy not to hold a contractor responsible for loss of or damage to Government property when such property is provided under:

(a) A negotiated, fixed-price type procurement contract for which the price is not based on (1) adequate price competition, (2) established catalog or market prices of commercial items sold in substantial quantities to the general public (see § 1-3.807-1(a)(2)), or (3) prices set by law or regulation;

or

(b) Cost-reimbursement type procurement contracts.

[39 FR 4761, Feb. 7, 1974, as amended at 42 FR. 33750, July 1, 1977]

§ 15-60.102-2 Subcontractors.

(a) If Government property is provided to a subcontractor directly by the Government § 15-60.102-1 shall apply.

(b) If Government property is provided to a subcontractor by a prime contractor, the latter shall be required to hold the subcontractor liable for any loss of or damage to such property; provided, however the prime contractor may, with the prior approval of the Contracting Officer:

(1) Include in any cost-reimbursement type subcontract thereunder provisions similar to those contained in paragraph (g) of the clause in FPR 1-7.203-2(a) or 1-7.402-25(b); and

(2) Include in any fixed-price subcontract meeting the criteria set forth in § 15-60.102-1(a) a provision similar to that contained in FPR 1-7.303-7(b). Contracting Officers shall, prior to approving the inclusion of the provisions referred to above in any subcontract, balance the need for the protection and care of Government property against the cost thereof. A prime contractor who provides Government property to a subcontractor shall not be relieved of any responsibility to the Government that he may have under the terms of his contract.

[39 FR 4761, Feb. 7, 1974, as amended at 42 FR 33750, July 1, 1977]

§ 15-60.103 Use for or by contractors of test facilities owned and operated by the Government.

The on-site use for or by contractors of existing Government-owned test facilities located at installations owned and operated by the Government may be authorized in connection with the performance of Government contracts only when:

(a) There is no commercial test capability adequate for the testing needs,

or

(b) Substantial cost savings will result from use of the Governmentowned test facilities.

Whenever any such use is authorized the Contracting Officer shall insure that adequate consideration comparable to commercial charges, if any, flows to the Government. (See § 1560.503 for policy regarding evaluation of bids and competitive proposals.)

Subpart 15-60.2—Material

§ 15-60.200 Scope of subpart.

This subpart prescribes policy and procedure for furnishing material (see § 15-60.101-7) to contractors for performance of EPA formally advertised and negotiated contracts.

§ 15-60.201 Policy.

Contractors normally are expected to furnish all material required for performance of EPA contracts. However, it may be in the Government's interest to furnish such material when

justified by reason of economy, to expedite contract performance, to achieve standardization, or under other appropriate conditions.

§ 15-60.202 Procedure.

(a) Solicitation documents shall describe material to be furnished by the Government, in detail sufficient for evaluation by prospective contractors.

(b) Whenever material is to be furnished by the Government the contract shall specify whether the contracting activity or the contractor is to prepare requisitioning documents. If the contractor is to be responsible for preparing requisitioning documents, the EPA Property Administrator will instruct the contractor to prepare such documents in accordance with the Federal Standard Requisitioning and Issue Procedure (FEDSTRIP) system, prescribed by Subpart 101-26.2 of the Federal Property Management Regulations. (See FPR Subpart 1-5.9 for "Use of GSA Supply Services by Contractors Performing Cost-Reimbursement Type Contracts.)

(c) The appropriate Government Property clause prescribed FPR Part 1-7 shall be incorporated into all contracts which provide for Governmentfurnished material.

[39 FR 4761, Feb. 7, 1974, as amended at 42 FR 33750, July 1, 1977]

§ 15-60.203 Contract changes.

(a) Contracts may be modified:

(1) bilaterally to provide for Government-furnished material when adequate consideration flows to the Government;

(2) unilaterally under the changes clause to increase the amount of Government-furnished material; and

(3) unilaterally to make substitutions or decreases in material to be furnished by the Government, subject to equitable adjustment of the contract in accordance with the Government Property clause.

§ 15-60.204 Disposal.

Residual Government material (including scrap and salvage) shall be disposed of in accordance with instructions of the EPA Property Administrator and as directed by the Contracting Officer. (See FPMR, EPA Property

(a) Contractors are expected to provide all resources necessary for performance of EPA contracts. Every effort must be made to locate and select contractors that demonstrate a willingness and ability to provide their own resources. However, during procurement planning, solicitation of prospective contractors, evaluation of proposals, contract negotiations, or during postaward performance of the contract, EPA may determine that it is in the Government't interest to furnish Government-owned property or to allow the contractor to acquire property at Government expense.

(b) Providing property at Government expense can create an expensive and burdensome inventory that may have to be disposed of at a fraction of its cost. EPA personnel must insure that (1) providing property is justified, (2) the Government receives adequate consideration, and (3) one contractor or prospective contractor, does not receive a competitive advantage over others. A decision to provide property at Government expense must be supported by a comprehensive "determination and findings."

(c) Items of property to be furnished by the Government or acquired by the contractor must be identified as specifically as possible in the original contract Schedule or in a Change Order or Supplemental Agreement, as appropriate. When acquisition of property at Government expense is authorized

in a contract Schedule, Change Order or Supplemental Agreement, purchase orders or subcontracts issued by the contractor for acquisition of individual items of property are subject to the requirements of the Subcontracts clause incorporated into the contract. Authorization to acquire property should not be construed as consent to placement of a subcontract or vice-versa, unless so specified in the contract or in a written determination by the Contracting Officer.

§ 15-60.301-2 Justification for providing property.

(a) The Contracting Officer shall not authorize a contractor to (1) acquire property at Government expense, (2) obtain Government-furnished property, or (3) use Government-owned property in his possession until the Chief Officer, at Division level or above, responsible for management of the program/project involved, submits a written justification of need to provide the property to the Contracting Officer. If the Contracting Officer concurs in the justification of need, he will prepare and sign a separate "determination and findings"

which identifies the property to be provided and sets forth the facts and circumstances which support providing the property. The "determination and findings" shall be approved by the Chief Officer responsible for procurement at the contracting activity involved. A similar approved "determination and findings" is required when changes are made in the kind or amount of property provided or acquired. However, a separate "determination and findings" is not mandatory if the justification of need fully supports providing the property and contains the minimum information prescribed in § 15-60.301-2(b). In such case concurrences by the Contracting Officer and Chief Officer responsible for procurement may be stated on the justification of need.

(b) As a minimum, the justification of need and/or "the determination and findings" must:

(1) Identify the specific program and project for which the property is required.

(2) Describe the kind, quantity, and estimated cost (including transportation and installation costs) of the individual item of property required to be furnished or acquired.

(3) Explain why the property is essential for contract performance.

(4) Explain why it is in the Government's interest to provide the property; why other alternatives (e.g., renting the property, use of subcontractors, modification of program/project requirements, procurement from another contractor, etc.); are impractical or uneconomical and why providing the requested property is likely to result in lower cost to the Government for products delivered or services rendered, when all costs are considered (e.g., purchase price of the property, transportation, modification, installation, maintenance, and administration costs by the contractor and the Government).

(5) Identify, if known, location of the contractor's facility at which the property will be used and the contractor's personnel assigned responsibility for acquisition and management of the property.

(c) A justification of need is required regardless of when the need for the property is determined; thus:

(1) A written justification of need must be transmitted with EPA Form 1900.8, Procurement Request/Requisition, whenever the program/project manager is aware, prior to preparation of EPA Form 1900.8, that it will be necessary to authorize use of Government-owned property in contractor's possession, furnish Governmentowned property, or allow contractor to acquire property at Government expense. Known requirements of this kind must be specified in the solicitation document as prescribed in Subpart 15-60.5.

(2) When the need to authorize use of existing Government-owned property or to authorize the furnishing or acquisition of property does not become known until evaluation of contractor's proposals or during contract negotiations, the Contracting Officer shall obtain a justification of need prior to execution of the procurement contract. In order to maintain the integrity of the competitive procurement

process, other proposers that have submitted proposals will be offered the opportunity to amend their proposals as contemplated by §§ 1-3.805 and 15-3.805.

(3) After award of a contract, the Contracting Officer shall not authorize the use, furnishing, or acquisition of property until a justification of need is furnished by the Chief Officer, at Division level or above, responsible for management of the program/project involved. Also, the Contracting Officer must insure that consideration for such authorization flows to the Government in the form of a reduction in contract price/cost, payment of rent for use of the property, or other legal consideration determined to be adequate in terms of improved performance, increased quality, faster delivery, etc.

§ 15-60.301-3 Special and general purpose property.

(a) Generally, only special purpose property (i.e., equipment and facilities items whose usefulness, without need for substantial modification, is limited to a particular operation or project) may be provided to a contractor. Standard or general purpose items of administrative equipment (e.g., office furniture and equipment, cafeteria equipment, lockers, shelving, etc.), and technical equipment (e.g., laboratory furniture and fixtures, microscopes, oscilloscopes, gauges, etc.), shall be provided only when justified under the most exceptional circumstances.

(b) Items of property having a unit cost of less than $1,000.00 shall not be provided contractors except as authorized under contracts with:

(1) Nonprofit institutions of higher education or other non-profit organizations whose primary purpose is the conduct of scientific research;

(2) State and local Government agencies; or

(3) Contractors operating a Government-owned plant or performing onsite at Government installations.

§ 15-60.301-4 Providing property when disposal is limited.

(a) Nonseverable property. Nonseverable property, other than foundation and similar improvements neces

sary for the installation of equipment, shall not be installed or constructed on land not owned by the Government, in such fashion as to be nonseverable, unless approved by the Director, Contracts Management Division, PM-214, or the Deputy Assistant Administrator for Administration, PM211, in accordance with EPA Order 1960.1. The determination to locate such nonseverable property on land not owned by the Government shall be made only when all of the conditions in paragraph (a) (1) through (4) of this section have been met:

(1) Consideration has been given to any nonrecoverable costs involved, including transportation and installation;

(2) Consideration has been given to (i) locating the Government property where it can be segregated from existing contractor-owned and Government-owned property and where it is readily accessible from public thoroughfares and (ii) obtaining a written agreement by the contractor on whose land the property is to be placed that either the Government or another Government contractor will have a right to use and operate the property upon termination or completion of the work for which it was provided. (In cases where such an agreement is not obtained, the negotiation effort shall be documented accordingly);

(3) The contractor agrees that the Government (i) will have the right to abandon in place all nonseverable Government property provided and (ii) will not have any obligation to disassemble or remove the property or to restore or rehabilitate the premises on which the property is located, unless otherwise provided in the contract and approved by the Director, Contracts Management Division, PM-214, or the Deputy Assistant Administrator for Administration, PM-211, as required by EPA Order 1960.1 (this approval authority shall not be delegated); and

(4) One of the circumstances in paragraphs (a)(4)(i) through (iv) of this section has been met(i) The Government option to acquire the underlying land;

obtain an

(ii) The property is disposable, after the Government's need therefor has ceased, to parties other than the con