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tractor and the Government acquires from the owner a right to retain title and to dispose of all facilities it has constructed, without regard to the laws of real property in the jurisdiction in which the facility is located. Such right of disposition must be unencumbered, and will be evidenced by written agreement or other legal instrument signed by the contractor or other owner of the real property;

(iii) The contractor agrees in writing that he will purchase the property upon the termination or completion of the contract under which the property is provided, or within a specified reasonable time thereafter, at a price to be determined by appraisal, or at a price equal to the acquisition cost of the property less depreciation at the rate or rates specified in the contract (which rate or rates shall take into account the estimated useful life of the property) or for the scrap and salvage value of the property if it is determined that the estimated useful life of the property will not extend beyond the completion of the work for which the property was provided. Any such purchase agreement must permit the Government to credit any amounts due the contractor under the contract against the purchase price; or

(iv) The Deputy Assistant Administrator, PM-211, specifically approves other provisions which he considers adequate to protect the interests of the Government in regard to the property.

(b) Property subject to patent or other proprietary rights. If patent or other proprietary rights of a contractor may restrict the disposal of Government property, the condition in either paragraph (a)(4)(ii) or (iii) of this section shall be satisfied before such property is provided.

§ 15-60.301-5 Changing Government property to be provided.

Increases in the amount of Government property specified in a contract shall be made under the contract "Changes" clause by issuance of an appropriate Change Order or Supplemental Agreement. Such increases shall be made only when approved in accordance with the policies prescribed in this Subpart 15-60.3 and

when the Government receives adequate consideration therefor. Unilateral decreases in or substitutions for the Government property specified in a contract to be provided by the Government may be ordered by the Contracting Officer pursuant to the Government Property clause incorporated into the contract.

§ 15-60.301-6 Contract schedule articles.

(a) General. Whenever a contractor is authorized to acquire property at Government expense, is furnished Government-owned property, or is authorized to use Government-owned property in his possession, such property will be identified, as specifically as possible, in the contract Schedule and the appropriate Government Property clause prescribed in FPR Part 1-7 will be included in the contract. Also, the Schedule will include the appropriate Article prescribed in § 15-60.301-6(b).

(b) Contract Schedule Articles. (1) When property is to be acquired or fabricated by a contractor, the estimated cost of such property and the following Article will be included in the Contract Schedule:

PROPERTY TO BE ACQUIRED OR FABRICATED (1973)

Subject to the approval of the Contracting Officer, the Contractor may acquire or fabricate (the property listed below) (the property listed in Appendix "A," attached hereto and made a part hereof). The Government will reimburse the Contractor for the cost of such property as determined allowable by the Contracting Officer in accordance with Part 1-15 of the Federal Procurement Regulations as in effect on the date of this contract. The Contractor shall have no obligation to acquire or fabricate property and the Government shall have no obligation to reimburse any amount for such property in excess of the total estimated cost of such property set forth in this Schedule, unless this contract is amended to increase such amount. All property acquired or fabricated, for which the contractor is reimbursed, shall be subject to the provisions of the Government Property clause of this contract.

(2) If a procurement contract is negotiated on the basis that Government-owned property will be provided the Contractor, the following Article will be included in the contract Sched

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ule. If the Government is to pay the cost of transportation and installation of such property the Schedule will so state. The dollar value of each item of property listed will be shown.

GOVERNMENT-FURNISHED PROPERTY (1973)

The terms and conditions of this contract are based on the Government furnishing the property (listed below) (listed in Appendix "A" attached hereto and made a part hereof). Title to property furnished shall remain in the Government and is subject to the provisions of the Government Property clause of this contract. The Contractor is authorized to use the Government-owned property (on a no-charge basis) (at the rental rates specified herein), in performance of this contract.

(3) The following Article will be inIcluded in the contract Schedule when a Contractor is authorized to use Government property in his possession. Also, the appropriate Government Property clause prescribed in FPR Part 1-7 must be incorporated into the procurement contract. The dollar value of each item of property listed will be shown and if the Government is to pay the cost of installing or modifying such property the Schedule will so state.

USE OF GOVERNMENT PROPERTY IN
CONTRACTOR'S POSSESSION (1973)

The Contractor is authorized to use in performance of this contract (on a nocharge basis) (at the rental rates specified herein), the Government property (listed below) (listed in Appendix "A" attached hereto and made a part hereof), provided to him under (this contract) (the following contracts:)

(4) The following Article will be inIcluded in all contracts under which the Contractor must pay rent for use of Government-owned property:

USE AND CHARGE

(a) Subject to the payment of a rental therefor, the Contractor may use in the performance of this contract the property specified in the Schedule or authorized in writing by the Contracting Officer. The amount of rental to be paid for the right to use the property under this paragraph (a) shall be determined in accordance with the following procedures:

(1) The following bases are or shall be established in writing for the rental computation prescribed in paragraph (a)(2) below in

advance of any use of the property under this paragraph:

(i) The rental rates for the right to use the property shall be those set forth in paragraph (e) below.

(ii) The cost of the property shall be the total cost to the Government, as determined by the Contracting Officer of each item of property, including the cost of transportation and installation, if such costs are borne by the Government.

(iii) For the purpose of determining the amount of rental due under paragraph (a)(2) below, the rental period shall be not less than one (1) month nor more than six (6) months, as may be mutually agreed to.

(iv) For the purpose of computing any credit under paragraph (a)(2) below, the measurement unit for determining the amount of use of the property by the Contractor shall be hours of actual use, direct labor hours, or any other measurement unit which will result in an equitable apportionment of the rental charge, as may be mutually agreed to.

(2) The Contractor shall compute the amount of rentals to be paid for each rental period, using the bases established pursuant to paragraph (a)(1) above. The rental rates shall be applied to the cost of such of the property as may have been authorized for use in advance pursuant to this paragraph (a), for each rental period. The full charge for each rental period, so determined, shall be reduced by a credit in the amount of such rental as would otherwise be properly allocable to work with respect to which the use of the property without charge is authorized. Such credit shall be computed by multiplying the full rental for the rental period by a fraction whose numerator is the amount of use of the property by the Contractor without charge during such period, and whose denominator is the total amount of use of the property by the Contractor during such period.

(3) The Contractor shall submit to the Contracting Officer within ninety (90) days after the close of each rental period a written statement of the use made of the property by the Contractor and the rental due the Government hereunder, and shall make available such records and data as are determined by the Contracting Officer to be necessary to verify the information contained in the statement.

(4) If the Contractor fails to submit the statement within the prescribed ninety (90) day period, the Contractor shall be liable for the full rental for the period in question, subject to the exception stated in subparagraph (5) below.

(5) If the Contractor's failure to submit the statement within the prescribed ninety (90) day period arose out of causes beyond the control and without the fault or negli

gence of the Contractor, the Contracting Officer shall grant to the Contractor in writing a reasonable extension of time in which to make such submission.

(b) Unless otherwise authorized in writing by the Contracting Officer, the Contractor shall use the property only in performance of contracts and subcontracts of the Environmental Protection Agency.

(c) Concurrently with the submission of the written statement prescribed by paragraph (a)(3) above, the Contractor shall pay the rental due the Government under this Article by check made payable to the Treasurer of the United States. Each check shall be mailed or delivered to the Contracting Officer. Receipt and acceptance by the Government of the Contractor's checks pursuant to this paragraph shall constitute an accord and satisfaction of the final amount due the Government hereunder unless the Contractor is notified in writing within onehundred-eighty (180) days following such receipt that the amount received is not regarded by the Government as the final amount due.

(d) If the Contractor uses any item of the property without authorization, the Contractor shall be liable for the full monthly rental, without credit, for such item for each month or part thereof in which such unauthorized use occurs: Provided, however, that the Director, Contracts Management Division, PM-214, may, in writing, waive the Contractor's liability for such unauthorized use if he determines that the Contractor exercised reasonable care to prevent such unauthorized use. In this latter event, the Contractor shall be liable only for the rental that would otherwise be due under this Article. The acceptance of any rental by the Government hereunder shall not be construed as a waiver or relinquishment of any rights it may have against the Contractor growing out of the Contractor's unauthorized use of the property or any other failure to perform this contract according to its terms.

(e) The following rental rates shall be used when rent is to be charged, or an evaluation factor (equivalent to rent) is computed:

(1) For land and land preparation, buildings, building installations, and land installations, a fair and reasonable rental based on sound commercial practice;

(2) For personal property (equipment and facilities) not covered in (1) above; not less than the prevailing commercial rate for like property, if any, or in the absence of such rate, not less than two percent (2%) of the dollar value per month for electronic test equipment and automotive equipment; and not less than one percent (1%) of the dollar value per month for all other property and equipment.

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(b) If the Contractor enters into other subcontracts with subcontractors who have Government-owned property provided to them under contracts which provide that no-charge use may be authorized, the Contracting Officer may authorize the use of such property on a no-charge basis: Provided:

(1) He determines that such use will not give the subcontractor a favored competitive position; and

(2) This contract is amended to reflect adequate consideration to the Government for the use of such property on a no-charge basis. Such subcontracts shall specifically authorize the no-charge use, and require the written approval of the Contracting Officer. No modification to this contract will be required, as provided in (2) above, if the Contracting Officer determines that an elimination of charge for use of such property will, of itself, result in an adequate decreased cost to the Government under this contract.

(c) If the Government-owned property provided to the Contractor or any subcontractor hereunder on a no-charge basis are increased or decreased or do not remain available during the performance of this contract, or if any change is made in the terms and conditions under which they are made available, such equitable adjustments as may be appropriate will be made in the terms of this contract, unless such increase or decrease was contemplated in the establishment of the price of this contract or a subcontract.

(d) The Contractor agrees that he will not directly or indirectly, through overhead charges or otherwise, include in the price of this contract, or seek reimbursement under

this contract for, any rental charge paid by the Contractor for the use on other contracts of the property referred to herein. Any subcontract hereunder which authorizes the subcontractor to use Government property on a no-charge basis shall contain a provision to the same effect as this paragraph (d).

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

Subpart 15-60.4-Use and Charges

§ 15-60.400 Scope of subpart.

This subpart deals with the authority for a contractor or subcontractor to use Government property and the charge for such use.

§ 15-60.401 General.

Authority for a contractor to use Government property must be granted by the Contracting Officer responsible for the contract under which the property is accountable and the contract file must be documented accordingly. If use without charge is granted, the contract file must be documented with a description of the consideration to the Government for such "no-charge" use and the Article prescribed in § 1560.301-6(b)(3) must be included in the contract Schedule. The Article prescribed in § 15-60.301-6(b)(3) and the "Use and Charges" Article set out in § 15-60.301(b)(4) will be included in all contracts involving Government property when rent is charged for such use.

§ 15-60.402 Use without charge.

(a) A contractor may use Government property without charge in the performance of:

(1) Prime contracts which specifically authorize use without charge, and

(2) Subcontracts of any tier if the Contracting Officer having cognizance over the prime contract concerned has:

(i) Determined that the Government will receive adequate consideration, and

(ii) Authorized use without charge by:

(a) Including such authorization in the prime contract;

(b) Approving a subcontract specifically authorizing such use; or

(c) By otherwise approving such use in writing.

(b) A prime contractor may authorize subcontractors to use Government property in the subcontractor's possession, on a no-charge basis, when (1) the price or fee of the prime contract is negotiated with the specific understanding that the use of property by subcontractors on a no-charge basis will be permitted in the performance of specific subcontracts with specific subcontractors and (2) the "Use of Government Property by Subcontractors" clause, prescribed in § 1560.301(b)(5), is included in the prime contract Schedule.

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

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(a) The following rental rates shall be used when rent is to be charged or an evaluation factor (equivalent to rent) is computed:

(1) For land and land preparation, buildings, building installations, and land installations, a fair and reasonable rental based on sound commercial practice; and facilities) not covered in paragraph (a)(1) of this section not less than the prevailing commercial rate for like property, if any, or in the absence of such rate, not less than two percent (2%) of the dollar value for electronic test equipment and automotive equipment; and not less than one percent (1%) of the dollar value per month for all other property and equipment.

Subpart 15-60.5 Competition

§ 15-60.500 Scope of subpart.

This subpart sets forth guidance designed to preclude one prospective contractor from receiving a competitive advantage over others when Government property is provided.

§ 15-60.501 General.

It is incumbent upon the Contracting Officer to insure that genuine competition prevails and that adequate consideration flows to the Government whenever and however Government property is to be provided a

contractor for contract performance. Willingness and ability to provide all resources necessary for contract performance should be an important factor in evaluating competitive contractors.

§ 15-60.502 Solicitation documents.

Contracting Officers shall make certain that solicitation documents:

(a) Require prospective contractors to specify additional facilities and equipment which must be acquired for contract performance, the estimated cost of individual items, and whether acquisition of such property will be financed by the prospective contractor or whether the Government will be requested to provide the required items.

(b) Explain whether it is the Government's intention to provide property, when it is known prior to solicitation that contract performance will require additional facilities or equipment.

(c) Require prospective contractors to:

(1) List items (including dollar value) of Government-owned property in their possession which they propose to use in performance of the prospective contract;

(2) Identify the contract or other instrument under which the property is accountable; and

(3) Present written permission to use such property in the performance of the prospective EPA contract from the Government Contracting Officer having cognizance of the property.

(d) Include a statement that the user will assume all costs related to making the property available for use (e.g., transportation, installation, rehabilitation, modification, etc.), unless, the Government is to assume such costs.

(e) Include a statement which explains the consideration to be given Government property during evaluation of bids and proposals. This is to insure that all prospective bidders and offerors understand that Government property will be an important consideration in evaluating their bids and proposals.

§ 15-60.503 Evaluation of bids and proposals.

The following policy shall be considered during evaluation of bids and proposals:

(a) In a competitive procurement, a prospective contractor provided Government property or authorized to use Government-owned property in his possession receives some degree of competitive advantage. When evaluating bids and proposals, such an advantage must be precluded through use of an equalizing factor in establishing the competitive range for negotiation and in arriving at the lowest bid. Any equitable equalizing factor may be used; e.g., rent equivalent, value of property, depreciation, etc.

(b) Government property to be furnished or acquired need not be assigned a weighted factor or criterion for evaluating bids and proposals. However, the evaluation narrative shall explain the importance that was placed upon Government property in rating and ranking bids and proposals.

(c) If a contractor is to be allowed to retain Government property at contract completion, the bid or proposal price shall be increased by an evaluation factor equivalent to:

(1) The cost to be reimbursed by the Government for property acquired at Government expense; and

(2) The current dollar value (cost less depreciation) of Government-furnished property.

Subpart 15-60.6—Administration of Government Property

§ 15-60.600 Scope of subpart.

This subpart sets forth policy and procedures governing administration of Government-furnished property and property acquired by contractors at Government expense for performance of EPA contracts.

§ 15-60.601 General.

(a) Responsibility within EPA for administering Government property in a contractor's possession rests primarily with EPA Property Administrators and is defined in an "Agreement of Understanding Covering Contract

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