(ii) the risk to the Government in guaranteeing a loan; and (iii) the likelihood, if award is made to the second low offeror, of his applying for a guaranteed loan at a later date. Extreme care should be excercised in rejecting a low bid or proposal simply because the low offeror requires a guaranteed loan. (6) The amount of the loan should bear reasonable relationship to the value and terms of the contract, the probable investment required to be made by the contractor in payrolls and inventories, etc., the frequency with which contract payments are to be made, and the borrower's current working capital position. (7) Borrowings for working capital purposes under guaranteed loans shall be limited to the amount necesssary to perform the contracts for which the loan is sought. In order that the contractor will also use its own funds in the performance of the contracts, amounts outstanding under the loan or line of credit shall be limited to an amount not to exceed 90 percent of the borrower's investment in its contracts regardless of the total amount of the loan or line of credit authorized. The borrower's investment includes all items for which the borrower would be entitled to payment on performance or termination of defense contracts, but does not include any items for which no work has been done nor expenditures made. (8) Unless there are exceptional circumstances, the loan should mature not later than 30 days after the estimated date of final payment under the contract. Partial payments, as a financing device, may be used in conjunction with other methods of financing, such as guaranteed loans. Subpart 9-30.2 Basic Policies $9-30.209 Order of preference. (a) With respect to cost-reimbursement type procurement geneally, contracting officers shall require contractors to employ private financing with or without assignment of contract payments (FPR Subpart 1-30.7). Periodic interim reimbursement on account of incurred cost and payment of fixed fee (if any) will normally be made, reducing the amount of necessary financing for working capital (9-7.103-51). In some instances, where no other means of adequate financing is available on reasonable terms, ERDA may approve (in order of preference) a guaranteed loan or an advance payment for performance of the contract. (b) Partial payment, as provided for in the standard form of supply contract (FPR 1-16.901-32), should be considered as a form of contractor financing in the second place in the order of preference. Subpart 9-30.4 Advance Payments $9-30.400 Scope of subpart. This subpart does not apply to financing arrangements for contracts with ERDA prime integrated contractors who are financed through special arrangements. (a) Interest will be charged on the unliquidated balance of all advance payments at the rate established by the Secretary of the Treasury pursuant to Pub. L. 92-41, 85 Stat. 97, for the Renegotiation Board; however, advance payments may be made without interest: (1) pursuant to FPR 1-30.403, (2) in CPFF contracts for construction or engineering services or, (3) where the contract provides that title to the advance has been retained by the Government ($9-50.704-18). The total advance payment shall not exceed 90 percent of the value of the uncompleted portion of the contract and shall not include any portion of the anticipated profit or the fixed fee. $9-30.406 Responsibility - delegation of authority. The head of the procuring activity or designee shall have the responsibility and authority for making the findings and determinations referenced in FPR 1-30.406. Subpart 9-30.5 Progress Payments Based on Costs $9-30.517 Contract financing office clearance. The prior approval specified here shall be obtained from the Controller. To the extent applicable and appropriate, these provisions may also relate to a partial payments clause. If justified, an amendment for this purpose may be made without consideration pursuant to FPR Part 1-17 and Part 9-17. When any such amendment is made, the consent of sureties, if any, should be obtained. $9-30.701 Subpart 9-30.7 Assignment of Claims General. FPR 1-30.701 is implemented as follows: (a) In the case of prime contracts, when it has been determined that the financing of defense contracts will be facilitated in the interest of ERDA program, it is the policy of ERDA that such contracts provide, or be amended without consideration (see Assignment of Claims Act of 1940) to provide, that payments to be made to an assignee shall not be subject to reduction or setoff; (1) For any liability of any nature of the assignor to the United States or any department or agency thereof which arises independently of such contracts; (2) For any liability of the assignor on account of: (i) renegotiation under any renegotiation statute or under any statutory renegotiation article in the contract; (ii) fines; (iii) penalties (which term does not include amounts which may be collected or withheld from the assignor in accordance with, or for failure to comply with, the terms of the contract); (iv) taxes, social security contributions, or the withholding or nonwithholding of taxes or social security contributions, whether arising from or independently of such contract. (b) In the case of subcontracts, when loans are made for the purpose of financing performance of subcontracts under ERDA prime contracts, financing institutions (or the Government as guarantor in those instances in which such loans are guaranteed) should not be required to incur risks of loss by reason of possible diversion of assigned subcontract proceeds for payment of other claims of the prime contractor against the borrower otherwise unrelated to the assigned subcontracts. In the interest of national defense financing, heads of procuring activities shall require the adoption of these policies and practices by ERDA prime contractors with respect to ERDA subcontract work. Heads of procuring activities should inform the Controller of each ERDA contractor who is unwilling to adopt policies consistent with this paragraph and the reasons given in support of the contractor's position. $9-30.703 Contract clause The last two Assignment of Claims. sentences of paragraph (a) of the clause in FPR 1-30.703 shall also be deleted in all contracts for transportation services. (a) In classified contracts, the assignee should ordinarily be furnished, upon request, with the following information, as applicable, in lieu of a copy of the contract: (6) ERDA office and address receiving the material or ser subcontract number or purchase order number; date of the subcontract or purchase order; date on which prime contract, subcontract, or purchase order is to be completed; (7) total amount of the subcontract or purchase order; (8) dollar amount remaining to be delivered on prime contract, subcontract, or purchase order; and (9) a statement as to the assignability of the prime contract, subcontract, or purchase order. (b)(1) It is ERDA policy that any assignment of claims shall cover all amounts payable under the contract and not already paid. Partial assignments shall not be permitted unless they are primarily for the benefit of the Government, as stated in FPR 1-30.708 (c)(1). PART 9-50 OPERATING AND ONSITE SERVICE CONTRACTS Scope. Scope. Mandatory use of Federal specifications. List of concerns or individuals debarred, suspended or 9-50.000 9-50.001 9-50.100 9-50.101 9-50.102 9-50.103 9-50.104 9-50.105 9-50.106 9-50.107 9-50.108 9-50.109 9-50.109-1 9-50.109-2 9-50.109-3 Small business concerns. Reporting possible antitrust violations. Qualified products. Subcontracting with minority business enterprises. Records and reports. General policy on avoidance of organizational conflicts of interest. Scope. Architect-engineering/construction services. Protection and private use of information and data by contractor. Subpart 9-50.2 Mistakes in subcontracting 9-50.2.200 Procedures for Handling Mistakes under operating and on-site service contractor procurement. Subcontracting policies and procedures. Responsibility of contracting officers. Procurement from contractor - controlled sources. Operating and onsite service contracts. Field recommendations to extend or compete operating contracts and onsite service contracts. |