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(ii) Loop facilities. A loop facility differs from a loop setup in that it is of a more permanent character; usually, but not always, of greater size; normally involves the building or modification of a structure; sometimes is installed as a part of construction of the facility; and may be designed for use in a succession of experimental programs over a longer period of time. Examples of loop facilities are the in-reactor "K" loops at Hanford and the large Aircraft Nuclear Propulsion loop at National Reactor Test Site. The on-site assembly and erection of such loop facilities are covered. However, once a loop facility is completed and becomes operational, the criteria set forth above for operational and maintenance activities apply.

(3) Reactor component experiments. Other experiments are carried on by insertion of experimental components within reactor systems without the use of a loop assembly. Illustrative of reactor facilities erected for such experimental purposes are the special power excursion test reactors at the National Reactor Test Site, which are designed for studying reactor behavior and performance characteristics of certain reactor components. Such a facility may consist of a reactor vessel, pressurizing tank, coolant loops, pumps, heat exchangers, and other auxilary equipment as needed. The facility also may include sufficient shielding to permit work on the reactor to proceed following a short period of power operation and buildings as needed to house the reactor and its auxilary equipment. The erection and on-site assembly of such a reactor facility is covered work but the components whose characterisitics are under study are excluded from coverage. To illustrate, one of the SPERTS planned for studies of nuclear reactor safety is designed to accommodate various internal fuel and control assemblies as required to conduct a particular test. Accordingly, the internal structure of the pressure vessel is 80 designed that cores of differenct shapes and sizes may be placed in the vessel for investigation, or the entire internal structure may be easily removed and replaced by a structure which will accept a different core design. Similarly, the control rod assembly is arranged to provide for flexibility in the removal of instrument leads and experimental assemblies from within the core.

(4) Tests or experiments in peaceful uses of nuclear energy. These tests or experiments are varied in nature and some are only in a planning state. These tests or experiments consist of a single or series of nuclear or nonnuclear detonations for the purposes of acquiring data. The data can include seismic effects, radiation effects, amount of heat generated, amount of material moved and so forth. Some of these tests are conducted in existing mines while others are conducted in locations specifically constructed for the tests or experiments. In general, all work which can be performed in accordance with customary drawings and specifications as well as

other work in connection with preparation of facilities is treated as covered work. Such work includes tunneling, drilling, excavation and backfilling, erection of buildings or other structures, and installation of utilities. The installation of the nonnuclear material or nuclear device to be detonated, the instrumentation, and connection between such material or device and the instrumentation are treated as noncovered work.

(5) Tests or experiments in military uses of nuclear energy. As in the case in $9-18.750-2(h) (4), these tests or experiments can be varied in nature. However, under this category it is intended to include only detonation of nonnuclear material or nuclear devices. The material or devices can be detonated either underground, at ground level or above the ground. These tests or experiments have been conducted in, on, or in connection with facilities specifically constructed for such tests or experiments. As is the case with respect to tests or experiments in peaceful uses of nuclear energy, all work which can be performed in accord with customary drawings and specifications as well as other work in connection with preparation of facilities are treated as covered work. Such work includes building towers or similar structures, tunneling, drilling, excavation and backfilling, erection of buildings or other structures, and installation of utilities. The installation of the nonnuclear material or nuclear device and instrumentation are treated as noncovered work.

(i) Construction site contiguous to an established manufacturing facility. As ERDA owned property sometimes embraces several thousands of acres of real estate, a number of separate facilities may be located in areas contiguous to each other on the same property. These facilities may be built over a period of years, and established manufacturing activities may be regularly carried on at one site on the property at the same time that construction of another facility is underway at another site. On occasion, the regular manufacturing activities of the operating contractor at the first site may include the manufacture, assembly and reconditioning of components and equipment which in other industries would normally be done in established commercial plants. While the manufacture of components and equipment in the manufacturing plant is noncovered, the installation of any such manufactured items on a construction job is covered.

Subpart 9-18.8 Inspection and Acceptance

$9-18.800 Scope of subpart.

This subpart implements and supplements FPR 1-14 by prescribing the policies and requirements for inspection and acceptance under construction contracts.

$9-18.802-1 Construction contracts.

(a) Inspection services may be performed by the architectengineer responsible for the design. Inspection services may not be procured from a fixed-price construction contractor with respect to its own work. Under cost-reimbursement type contracts where the construction contractor and architect-engineer are the same, some degree of self-inspection may be permitted but shall not constitute final inspection and acceptance by the Government.

(b) When one contractor is to inspect the work of another, the inspecting contractor will be given written instructions defining its responsibilities and stating that he is not authorized to: modify the terms and conditions of the contract; to direct additional work: to waive any requirements of the contract; nor to settle any claim or dispute. Copies of the instructions will be given to the contractor who is to be inspected, with a request to acknowledge receipt on a copy to be returned to the contracting officer. In this manner, both contractors are on express notice of the authority, and limitations on the authority, of the inspected contractor.

Subpart 9-18.50 Rental of Construction Equipment

$9-18.5000 Scope of subpart.

This subpart sets forth general policy and instructions which shall be applied to rental of construction equipment for use by ERDA contractors with cost-reimbursement type contracts.

$9-18.5001 General Policy.

It is the policy of the ERDA:

(a) To use presently owned ERDA construction equipment to the fullest extent. Careful investigation shall be made of the equipment available not only at the field office concerned, but at other field offices, to determine whether such equipment can be economically utilized on the job. The senior procurement official, Headquarters, can assist in the investigation of excess equipment available in other offices.

(b) To rent construction equipment, where available, rather than purchase it, unless in the case of third-party-owned equipment, the field office determines that accrued rentals on a particular item of equipment will approximate the cost of ownership of it except, however, that individual items of construction equipment having an original cost of less than $1,000 ordinarily should be purchased and not rented. Where it is clearly to the advantage of the Government, items

having a cost of less than $1,000 may be rented with the approval of the head of the procuring activity. Whenever it is practical, cost and other factors considered, contractor-owned equipment shall be rented in preference to renting third-party-owned equipment.

(c) To pay rental for construction equipment at rates not higher than those prevailing in the locality, except under unusual circumstances, and at as low a rate as is consistent with securing modern equipment in good operating condition. Costs of repair, job interruption due to poor equipment, transportation and in-transit rental may well offset any apparent savings in rental rates. Rental paid shall be subject to any Government price ceiling regulations that may be in effect.

$9-18.5002 Rental of contractor-owned equipment.

$9-18.5002-1 Rental agreement.

The terms and conditions governing rental by ERDA of construction equipment from a prime cost-type construction contractor are set forth in $9-16.5002-2, outline of agreement for rental of contractor-owned construction equipment. This form of agreement is designed for use as an appendix to a ERDA cost-type construction contract. It may be modified for rental of equipment under other contractual arrangements, such as an operating contractor renting from a cost-type construction subcontractor, and it may be modified for use a separate contract

an attachment to a subcontract. Some of the aspects of this agreement to which particular attention should be given are set forth in $9-18.5002-2 and $9-18.5002-3.

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$9-18.5002-2 Rental period.

The base rental period shall extend from the time the equipment is accepted at the job site until the contractor is notified in writing by ERDA's representative that the equipment is no longer required. Subject to applicable, limitations covered in the rental agreement form, the contractor shall be paid rental during the in-transit time and during the time required for equipment repair or replacement prior to return to the contractor.

$9-18.5002-3 Rental rates.

(a) Rates for rental of contractor-owned equipment shall be fair and equitable. The rental rates contemplate that ERDA will pay incoming and outgoing transportation costs and rental during in-transit time for both inbound and outbound transportation of equipment; however, terms more favorable to ERDA may be negotiated where appropriate. The rental rates to be paid for the use of contractor-owned

equipment under normal conditions should not exceed 65 percent of the rates quoted in the latest edition of the Associated Equipment Distributor's "Complilation of Averaged Rental Rates for Construction Equipment." However, heads of procuring activities may approve rates in excess of 65 percent of the current A.E.D. schedule when local conditions require higher rates. When it becomes necessary as a general practice to exceed 65 percent of the current A.E.D. schedule, heads of the procuring activities shall be advised.

(b) For items of equipment that are not covered by the A.E.D. schedule, use the latest edition of "Contractors' Equipment Ownership Expense" document published by The Associated General Contractors of America, Inc., and information on prevailing local rates for developing rates that would be consistent with the 35 percent reduction in the A.E.D. rates (i.e., taking into consideration the expenses paid by the Government under the rental agreement).

$9-18.5002–4 Application of rates.

The rental rates shall be applied in accordance with the following rules:

(a) Basis of rates. The rates shall be based upon one shift of 8 hours per day, 40 hours per week, or 176 hours per month of a 30-consecutive-day period.

(b) Apportionment of rates. The monthly rate and its pro rata shall apply to all rental periods of 1 month or more. The weekly rate and its pro rata shall apply to all rental periods of 1 week or more up to 1 month. The daily rate and its pro rata shall apply to all rental periods up to 1 week.

(c) Overtime. Inasmuch as there are certain elements of cost to an equipment owner which do not change even though the equipment is used on more than one shift per day, it is believed equitable to pay a lower rental rate during a second and third shift than would be paid during a single shift. Therefore, the rental agreement form provides for payment for overtime at a rate equal to one-half the rate for the first shift.

$9-18.5002-5 Insurance.

(a) Generally, rental rates should include the cost of insurance or self-insurance covering loss of or damage to the equipment during rental periods. The rental agreement for contractor-owned equipment is so worded.

(b) However, if the contracting officer determines that it is not practical to include the cost of such insurance in the rental

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