upon presentation of proper receipt after contract and bonds have been signed and approved.

(b) Certified checks or other negotiable security furnished in support of other than the three lowest acceptable bids should be returned promptly to the respective bidders by certified mail, or in person upon presentation of proper receipt.

(c) Commercial bid bonds are not returned unless specifically requested by the bidders, and, even if requested by any of the three low bidders, are not returned until contract and bonds have been executed by the successful bidder, or all bids have been rejected.

Subpart 828.2-Sureties

828.203 Options in lieu of sureties. 828.203-1 United States bonds or notes.

Contracting officers, with the exception of those located in the District of Columbia, receiving United States bonds or notes in lieu of corporate or individual sureties will forward such bonds and notes to the agent cashier for safekeeping. Contracting officers in the District of Columbia will deposit such bonds and notes with the Treasurer of the United States.

828.203-2 Certified or cashier's checks, bank drafts, money orders, or currency.

Contracting officers receiving a certified or cashier's check, bank draft. post office money order or currency in

lieu of corporate or individual sureties

will deposit them with the agent cashier.

Subpart 828.3-Insurance

828.306 Insurance under fixed-price contracts.

(a) Term contracts, or contracts of a continuing nature, for ambulance. automobile and aircraft service, will contain the provision in 852.237-71.

(b) Erceptions. The provisions of this 828.306 do not apply to emergency or sporadic ambulance service author

Subpart 828.71-Indemnification of Contractors, Medical Research or Development Contracts

828.7100 Scope of subpart.

(a) This subpart sets forth the policies and procedures concerning indem

nification of contractors performing

contracts which involve a risk of an unusually hazardous nature, covering medical research or development as authorized by 38 U.S.C. 4101.

(b) The authority to indemnify the contractor under this subpart does not create any rights to third parties which would not otherwise exist by law.

(c) As used in this subpart the term "contractor" includes subcontractors of any tier under a contract containing an indemnification provision pursuant to 38 U.S.C. 4101(c)(3)(A).

which involves a risk of an unusually hazardous nature, may provide that the Government will indemnify the contractor against either or both of the following, but only to the extent that they arise out of the direct performance of the contract and to the extent not covered by the financial protection required under 828.7103.

(1) Liability (including reasonable expenses of litigation or settlement) to third persons, except liability under State or Federal Workmen's Compensation Acts to employees of the contractor employed at the site of and in connection with the contract for which indemnification is granted, for death, bodily injury, or loss of or damage to property, from a risk that the contract defines as unusually hazardous.

(2) Loss of or damage to property of the contractor from a risk that the contract defines as unusually hazardous.

(b) A contract that provides for indemnification in accordance with this subpart will also provide for:

(1) Notice to the contracting officer of any claim or suit against the contractor for death, bodily injury, or loss of or damage to property; and

(2) Control of or assistance in the defense by the Government, at its election, of such suit or claim for which indemnification is provided in

the contract.

828.7103 Financial protection.

(a) The financial protection to cover liability to third persons and loss of or damage to the contractor's property which the contractor is required to have and maintain shall be the maximum amount of insurance available from private sources; however, the Administrator may establish a lesser amount after taking into consideration the cost and terms of private insurance.

(b) The financial protection may include private insurance, private contractual indemnities, self-insurance, other proof of financial responsibility, or a combination of such forms to provide the maximum amount required. When the contractor elects to utilize self insurance, proof of such financial

ulations of the Bureau of Alcohol, Tobacco, and Firearms (ATF) (see 27 CFR 211.231-237, 213.141-146 and 240.720-722). The use of tax-free alcohol, whiskey, beer, wine and denatured spirits for nonbeverage purposes shall include but not be limited to medicinal and scientific purposes and in the treatment of patients.

(2) Authority is hereby delegated to the Chief, Marketing Center. Hines, Illinois, and to the Chief, Supply Service, Veterans Administration medical facilities to sign application permits on Bureau of Alcohol, Tobacco, and Firearms (ATF) prescribed forms. This authority is not to be redelegated.

(b) Whiskey, alcohol, and denatured

procedures.

829.270-2 Processing of order by Veterans

Administration.

Subpart 829.3-State and Local Taxes

829.302 Application of State and local taxes to the Government.

AUTHORITY: 38 U.S.C. 210 and 40 U.S.C.

486(c).

SOURCE: 49 FR 12614, Mar. 29, 1984, unless otherwise noted.

829.000 Scope of part.

This part prescribes policies and procedures for exemptions from Federal excise taxes imposed on tobacco and alcohol products for such items purchased for use in the Veterans Administration medical care program and specifies refund procedures for State and local taxes.

Subpart 829.1-General

829.101 Resolving tax problems.

Contracting officers will submit requests for legal advice through channels to the General Counsel.

Subpart 829.2-Federal Excise Taxes

829.202 General exemptions.

(1) Application forms for tax-free purchases are to be obtained from and submitted to the Director, Bureau of Alcohol, Tobacco, and Firearms, Washington, D.C. 20226.

(2) ATF Form 1486, Specially Denatured Spirits for Use of United States, is the application/permit required for denatured spirits, and ATF Form 1444. Tax-Free Spirits for Use of United States, is required for distilled spirits (whiskey and alcohol). These are continuing permits to procure items tax free. Copies must be made available to the supplier in support of each procurement.

(3) Purchases for excise tax-free whiskey and alcohol, not available through the depot can only be made from a distillery or a bonded premises. In accordance with 27 CFR 213.144, the vendor will also support each shipment with ATF 1473, Shipment and Receipt Specifically Denatured TaxFree, or Recovered Spirits. The ATF 1473 will be completed by the accountable officer and the original copy will be forwarded to the Regional Regulatory Administrator whose address is shown in item 12 of the form. A copy of ATF 1473 will be retained in the purchase order file.

(c) Wine. No tax exemption form or ATF permit is required for the tax

products.

(a) General.

(1) The procurement of spirits free of tax for nonbeverage purposes is permitted to Government agencies by reg

copy of a properly executed purchase order or requisition document may be furnished to the supplier (retailer. wholesaler or winery) to facilitate record keeping.

(d) Beer. Tax-free beer may be procured only from licensed breweries and only when such product is prescribed for therapeutic use of patients. The application for an ATF permit is to be submitted in letter form to the Director, Bureau of Alcohol, Tobacco, and Firearms, Washington, D.C. 20226. The following information is required. (1) Name and address of facility; (2) Specific purpose for which beer will be used;

(3) Quantity proposed to buy each month, year, etc.;

(4) Name and address of brewery; and

(5) Copy of document authorizing contracting officer to sign request.

A new permit is needed only when beer is to be purchased from a different brewery than the one for which the original permit was requested.

829.270 Tax exempt tobacco products for State institutions.

(a) Bureau of Alcohol, Tobacco, and Firearms regulations permit the withdrawal of tax-free tobacco products by facilities and institutions owned or controlled by State Governments, territories, and the District of Columbia for gratuitous distribution to present and former members of the Armed Forces of the United States who are patients in such institutions (27 CFR 295.31-37). These arrangements will be effective only with institutions where the official-in-charge abides by the procedures and controls prescribed by the Veterans Administration. The unauthorized or illegal use of these prod ucts may result in the withdrawal of this privilege by the Veterans Administration.

(b) No tax exemption form or certificate is required for the tax-free purchase of tobacco products. An extra copy of the purchase order will be provided the manufacturer to facilitate record keeping required by the Bureau of Alcohol, Tobacco, and Firearms.

829.270-1 Institution responsibilities and procedures.

(a) The official-in-charge of the institution will act as a representative of the Veterans Administration in the purchase, storage, and distribution of these products and in ensuring the

product is distributed on a gratuitous and equitable basis to all eligible recipients. Under no circumstances will these items be offered for sale.

(b) The Veterans Administration will neither accept nor handle donations or funds for institutions.

(c) Payment or nonpayment of State taxes on tobacco products is a matter between the concerned State and the ordering institution.

(d) Orders will be on the institution's regular order form made out to the manufacturer of the desired product. The original and two copies of the order, each signed, will be forwarded to the nearest Veterans Administration medical center. Orders shall also be issued to cover receipt of unsolicited shipments of these products intended for use of veteran-patients. All copies of these orders will be marked CONFIRMATION-DO NOT RESHIP. All orders shall bear a certificate as follows:

Tobacco products for free distribution to present and former members of the Armed Forces of the United States who are hospitalized or domiciled in this institution.

(e) Copies of all orders and other pertinent documents will be retained and be available to the Veterans Administration and the Bureau of Alcohol, Tobacco, and Firearms for inspection purposes.

829.270-2 Processing of order by Veterans Administration.

(a) Full cooperation will be given institution representatives in implementing these procedures.

(b) The station director or designee will approve the institution order by signing the original and one copy in ink over his/her printed name and title. The approved orginal and copy shall be forwarded to the vendor as noted in 829.270. The additional copy shall be retained in the medical center's files.

[49 FR 12614, Mar. 29, 1984, as amended at 50 FR 794, Jan. 7, 1985]

bursement vocational rehabilitation and education contracts or agreements. 831.7001-1 Tuition.

(a) Except as provided in this section, when the contractor has a cus tomary cost of tuition the charge to the Veterans Administration may not exceed that charged to similarly circumstanced nonveteran students; provided that where the contractor has more than one standard charge for the same service, the charge to the Veterans Administration will be the lowest price for the entire course, semester. quarter, or term which is offered or published.

(b) The VA will not normally pay tuition or incidental fees to institutions or establishments furnishing ap prentice or other training on-the-job. The VA may pay:

(1) For such charges customarily made by nonprofit workshop or similar establishment for providing work adjustment training to similarly circumstanced nonveterans even though an incentive wage is paid the trainee as part of the training; or

(2) For certain training expenses incurred by an employer providing onthe-job training following rehabilitation to the point of employability when such additional training is determined to be necessary by the VA.

(c) When the total cost of instruction is paid from Federal funds or a portion of the cost is covered by grants from the Federal Government, Le.. Smith-Hughes or other laws, excluding Federal Land Grant Funds, such subsidy will be taken into consideration in determining the charge to the Veterans Administration. The term. Federal Land Grant Funds, refers to those received under the MorrillNelson Act (Morrill Acts of 1862 and 1890 and the Nelson amendment of 1907) and section 22 of the BankheadJones Act of 1935.

(d) Payments on behalf of a veteran who receives a fellowship, scholarship, grant-in-aid, assistantship, or similar award in complete or partial payment of tuition or fees or both will be made in accordance with the following: