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(3) The reasonably foreseeable requirements for its future use, and

(4) Its scrap or salvage value.

(c) If the contracting officer decides to consider the residual value of special tooling or special test equipment in a competitively negotiated procurement, the solicitation shall give notice thereof and a statement of the reasonably foreseeable future requirements of the Government for the supplies in question, in order to afford offerors the opportunity to consider such residual value as a factor in making their proposals. If the solicitation does not contain such notice and statement but the contracting oficer decides to consider the residual value of special tooling or special test equipment after receipt of the proposals, he shall during the negotiations give all offerors within a competitive range a notice and statement as above, and shall permit them to make such changes in their proposals as they may consider necessary as a result of the addition of the residual value factor. § 13.505 Additional evaluation factors.

(a) If the furnishing of Government production and research property will result in direct and measurable costs and under the terms contained in the solicitation such costs are to be borne by the Government, additional factors, set forth in the solicitation either in the form of a dollar amount or a formula, shall be employed in the evaluation of bids or proposals. Such factors shall be limited to:

(1) The cost of reactivation from base package or storage;

(2) The cost of rehabilitation and conversion; and

(3) The costs of making such property available on a f.o.b. basis.

(b) If, under the terms contained in the solicitation, the costs of furnishing Government production and research property or making it suitable for use are to be borne by the contractor, as, for example, when such property is offered on an “as is” basis (see $ 13.308), no additional evaluation factors related to such costs shall be used.

(c) If measurable savings to the Government will result directly from the use of Government production and research property on the contract for which the solicitation is made, a dollar amount representing such savings shall be set forth in the solicitation and employed in the

evaluation of bids or proposals. Examples of such savings include:

(1) Savings occurring as a direct result of activation of idle tools being maintained in idle status at known cost to the Government; and

(2) Avoidance of the cost of deactivation and placing active tools in layaway or storage, or of maintaining them in an idle state where the prospective costs are known and firm decisions have been made that such tools will be laid away or stored if not used on the contract for which solicitation is made. Avoidance of the costs of initial lay-away or storage shall not be evaluated when such costs will merely be deferred by the proposed use. (31 F.R. 1051, Jan. 27, 1966) § 13.506 Solicitations description of

evaluation procedure. Generally, where Government production and research property is offered for use in a competitive procurement, the solicitation should provide that the user will assume all costs related to making the property available (such as transportation or rehabilitation costs), to avoid the need for separate evaluation of such costs. Where this is not feasible, or it is otherwise in the Government's interest, the Government may assume certain of such costs provided they are included in the evaluation of bids or proposals. The rental charges or equivalent factors to be used to eliminate competitive advantage, as well as all costs or savings to be evaluated, shall be clearly shown in the solicitation to insure that all prospective bidders or offerors understand the basis to be used for selection of the lowest bid or proposal and take these factors into account in preparing their bids or proposals. Subpart F--Administration of Gov.

ernment Production and Research

Property 8 13.601 Maintenance. 8 13.601-1 Facilities contracts.

(a) To the extent practicable, the Schedule of each facilities contract containing the Maintenance clause set forth in $ 7.702–14 of this chapter shall specify or incorporate by reference a normal maintenance program.

(b) Where no provisions are made pursuant to paragraph (a) of this section, the contractor shall be required to

submit a normal maintenance program $ 13.602 Risk of loss or damage and liato the contracting officer as promptly as bility. practicable after the execution of the fa

When justified by the circumstances cilities contract. The contracting officer

of any particular contract, the contract shall examine such program and shall

may require the contractor to assume negotiate with the contractor for an

greater risks than those enumerated in agreement thereon.

the clause set forth in $ 7.702–18 of this (c) Any normal maintenance program

chapter, or the applicable contract clause that is agreed to pursuant to either para

set forth in Subpart G of this part, as graph (a) or (b) of this section shall

appropriate. provide specific details which will insure protection, preservation, maintenance,

& 13.603 Termination of facilities conand repair of the Government production

tracts. and research property in accordance A facilities contract shall be termiwith sound industrial practice. In ad nated when the Government production dition, such program shall include gen and research property covered thereby eral language covering any aspects of is no longer required for the performmaintenance which are not specifically ance of Government contracts or subprovided for. Such program may also contracts, unless such termination is provide for:

detrimental to the Government's inter(1) A specified degree of inspection

ests. The contractor shall not be procedures, maintenance, and repairs granted the unilateral right, at his electhat is less than sound industrial practice tion, to extend the time during which as to any part of the Government pro he is entitled to use the property production and research property which is vided under the facilities contract. determined by the Department con

§ 13.604 Standby or layaway provision. cerned to be nonessential to future utili. zation of the property as a whole; and (a) A facilities contract may include

(2) Reimbursement by the Govern appropriate provisions for maintenance ment for the cost of protecting, presery and storage of Government production ing, maintaining, and repairing Govern and research property in standby or ment production and research property layaway status. Such provisions shall not authorized for use by the contractor. include specifications for the care and

(d) The contracting officer shall order maintenance of the property appropri& decrease in maintenance when the cur- ate for its intended future use. These rent maintenance is not necessary to provisions may be the same as or differAssure the standards set forth in para ent from the Maintenance clause set graph (c) of this section, and when such forth in $ 7.702–14 of this chapter, dean order will result in savings to the pending upon the purpose and scope of Government.

the standby or layaway provisions, the (e) The contracting oficer may order expected duration of the standby or laymore than the normal maintenance when away status and other pertinent connecessary, but only after authority has siderations. been obtained pursuant to $ 13.302 and (b) If the Government is required to adequate funds are available therefor. pay the contractor for maintenance and The Government shall reimburse the storage of Government production and contractor for the costs incurred.

research property in standby or layaway, § 13.601-2 Contracts other than facili.

the facilities contract shall define with

particularity what constitutes standby ties contracts.

or layaway, and when and under what Government production and research circumstances such payments will comproperty provided under a contract other mence and terminate with respect to all than a facilities contract shall be main or any part of the property. tained in accordance with sound indus (c) The facilities contract shall protrial practice pursuant to the appropri vide that, if the contractor is required ate clause of the contract under which to pay any state or local property tax it is provided. However, the Schedule measured by his possession of or interest of any contract under which such Gov in Government production and research ernment production and research prop property in standby or layaway, he shall erty is provided may contain specific be reimbursed therefor to the extent maintenance requirements for such provided under $ 15.205-41 of this property when appropriate.

chapter.

§ 13.605 Retention of special tooling

and special test equipment. Upon termination or completion of a contract under which the Government has obtained title to or the right to acquire title to special tooling or special test equipment, the procuring activity shall review the Government's need for its continued retention. In addition, the procuring activity shall periodically review the Government's need for retaining all special tooling and special test equipment, not currently in use, to which it has title or the right to acquire title. In either case, consideration shall be given to the factors set forth in § 13.305–2(b) in determining the Government's need for retention of the special tooling and special test equipment. $ 13.606 Disposition.

(a) Disposition of Government production and research property shall be in accordance with applicable regulations and contract provisions (see, for example, $ 13.307). See Part 8 of this chapter for disposition of contractor inventory and Departmental regulations for disposition of surplus property generally.

(b) Contracts under which Government production and research property is provided to a contractor shall reserve to the Government the right to abandon such property in place, without any obligation to restore or rehabilitate the premises of the contractor. However, this right may be waived if the prior approval of the head of a procuring activity is obtained. The authority of the head of a procuring activity to grant such approval shall not be delegated. $ 13.607 Insurance.

When less than 75 percent of the total use of facilities is for Government work, consideration shall be given to requiring that the contractor procure and maintain insurance against loss of or damage to the facilities. If necessary, facilities contracts may be modified to require such insurance. $ 13.608 Property control and account

ing procedures. Property control and accounting procedures shall be maintained in accord

ance with the provisions of the “Manual for Control of Government Property in Possession of Contractors”, Appendix B, "Manual for Control of Government Property in Possession of Nonprofit Research and Development Contractors", Appendix C (98 30.2 and 30.3 of this chapter). Subpart G—Contract Clauses,

Government Property 1 § 13.701 Contract clauses.

Contract clauses and guidance as to their use in specific types of contracts are included in the following sections of this chapter:

(a) Government property.

(1) $ 3.608–2(b) (1) (viii) or small purchases.

(2) $ 7.104–24 for fixed price supply contracts.

(3) $ 7.203-21 for cost reimbursement type supply contracts.

(4) $ 7.303-7 for fixed price research and development contracts.

(5) $ 7.402-25 for cost reimbursement type research and devolpment contracts.

(6) $ 7.504-4 for personal services contracts.

(7) $$ 7.603-22 and 7.603–28 for fixed price construction contracts.

(8) $ 7.605–14 for cost reimbursement type construction contracts.

(9) § 7.702–18 for facilities contracts.

(10) § 7.901–5 for time and material and labor hour contracts.

(11) $ 7.1401.11 for laundry and dry cleaning contracts.

(12) § 16.102–2(c) (2) (xi) for short form negotiated contracts.

(b) Special tooling. (1) $ 7.104–25 for fixed price supply contracts.

(c) Special test equipment.

(1) $ 7.104–26 for fixed price supply contracts.

(2) $7.204–38 for cost reimbursement type supply contracts.

(3) $ 7.303–37 for fixed price research and development contracts.

(4) $ 7.403-33 for cost reimbursement type research and development contracts. (36 F.R. 7950, Apr. 28, 1971)

136 F.R. 7950, Apr. 28, 1971.

Subpart H-Administrative Practices § 13.801 Appointment of property ad.

ministrator. (a) The selection, appointment, and termination of appointment of property administrators shall be made in writing by the Head of a Procuring Activity or his designee for the Defense Supply Agency and by the head of the contract administration office ($ 1.201-25 of this chapter) or his designee for the Military Departments. In selecting qualified property administrators, the appointing authority shall consider experience, training, education, business acumen, judgment, character, and ethics.

(b) In considering experience, training and education, the following shall be evaluated:

(1) Experience in accounting, material control, inventory control and allied functions;

(2) Formal education or specialization in such areas as evaluating, monitoring, administering, or coordinating industrial property programs or implementing plans and policies in support of diversi fied property control system;

(3) Knowledge of the provisions of this and other applicable regulations. (32 F.R. 16408, Nov. 30, 1967, as amended at 33 F.R. 15392, Oct. 17, 1968) § 13.802 Assignment of contracts for

property administration. (a) All Department of Defense contracts under which Government property will be provided and which will be performed at a single location by a contractor shall be assigned to a single property administrator.

(b) Each contract under which Government property will be provided to the contractor will be assigned in writing to a property administrator by the CAO. The assignment document shall contain the (1) name and address of the contractor, (2) PII (contract) number, and (3) type of contract. The CAO and the contractor shall be advised in writing of the assignment and any changes thereto.

(c) The assignment shall be terminated when:

(1) It has been determined that no Government property has been or will be furnished or acquired, or

(2) The contract is reassigned to another CAO or to another property administrator. 132 F.R. 16408, Nov. 30, 1967) § 13.803 Records of Government prop

erty. Records of Government property established and maintained by the contractor pursuant to the terms of the contract shall be designated and utilized as the oficial contract records. Duplicate records shall not be furnished to nor maintained by the Government personnel other than as provided for in this subchapter. Exceptions to this policy may be authorized by the Head of a Procuring activity, or his designee, where Government property is furnished to a contractor for repair or servicing and return to the shipping organization under contracts administered by the procuring activity. In such cases, the property will be accounted for as a suspense item within the military account from which shipped and the Government property clause shall be modi. fied by insertion of the following clause.

PROPERTY RECORDS (AUGUST 1967) The Government shall maintain the offi. cial contract records in connection with Government property under this contract. The "Government Property" clause is hereby modified by deleting so much thereof as requires that the Contractor maintain sucb records. (32 F.R. 16408, Nov. 30, 1967)

PART 14-PROCUREMENT QUALITY

ASSURANCE Sec. 14.000 Scope of part. 14.001 Definitions. 14.001-1 Government procurement quality

assurance. 14.001–2 Contract quality requirements. 14.001-3 Inspection. 14.001-4 Testing. 14.001-5 Subcontractor. 14.001-6 Acceptance.

Subpart A-General 14.101 Types of contract quality require

ments. 14.101-1 Contractor responsibility provi

sions. 14.101-2 Standard inspection requirement. 14.101-3 Inspection system requirement. 14.101-4 Quality program requirement.

Sec. 14.101–5 Criteria for applying contract

quality requirements. 14.102 Responsibilities of the Contractor. 14.103 Responsibilities of the Govern

ment. 14.103–1 Subcontracts. 14.103–2 Specialized inspections reserved

to the Government. Subpart B-Responsibility of Government Orga

nizations for Quality of Supplies and Services 14.201 Organization responsible for tech

nical requirements. 14.202 Purchasing office. 14.203 Contract administration office. Subpart C-Contract Provisions for Government

Procurement Quality Assurance and Acceptance 14.301 Quality assurance clauses. 14.302 Standard inspection clauses. 14.303 Inspection system requirements. 14.304 Quality program requirements. 14.305 Places of performance of Govern

ment procurement quality as

surance actions. 14.305-1 General.

Government procurement quality

assurance at source. 14.305-3 Government procurement quality

assurance at destination. 14.306 Acceptance of supplies or services. 14.307 Place of acceptance. 14.308 Government procurement quality

assurance actions on small pur

chases. Subpart D- Performance of Government Procure

ment Quality Assurance Actions by Contract

Administration Offices 14.401 General. 14.402 Planning. 14.403 Implementation. 14.404 Maintenance of Government rec

ords. 14.405 Quality evaluation data. 14.406 Nonconforming supplies and serv

ices. 14.407 Government procurement quality

assurance actions at subcon

tract level. 14.407–1 General. 14.407-2 Conditions. 14.407–3 Selective evaluation at the sub

contract level. 14.408 Inspection stamping. 14.409 Authorizing shipment of supplies. 14.409-1 General 14.409–2 Alternative procedures contrac

tor release for shipment. Subpart E-Contract Administration of Special

Commodities 14.501 General. 14.502 Subsistence.

Sec. 14.503 Petroleum. 14.504 Construction projects. Subpart F-Performance of Government Procurement Quality Assurance Actions for and by Other Government Agencies, Foreign Governments and International Organizations 14.601 General. 14.602 Federal Aviation Administration. 14.603 Quality assurance among NATO

countries. 14.603–1 NATO quality control system re

quirements for industry. 14.603-2 NATO Quality Assurance Handbook

AQAP-2. AUTHORITY: The provisions of this part 14 issued under sec. 2202, 70A Stat. 120; 10 U.S.C. 2202. Interpret or apply secs. 23012314, 70A Stat. 127–133; 10 U.S.C. 2301-2314.

SOURCE: The provisions of this Part 14 appear at 32 F.R. 16408, Nov. 30, 1967, unless otherwise noted. § 14.000 Scope of part.

This part prescribes policies and procedures (a) to assure that supplies and services procured by the Department of Defense conform to the quality and quantity set forth in the contract and (b) for the acceptance functions associated therewith. § 14.001 Definitions.

As used in this part, words and terms shall have the meanings set forth below. $ 14.001-1 Government procurement

quality assurance. Government procurement quality assurance means the Government function by which the Government determines whether a contractor has fulfilled his contract obligations pertaining to quality and quantity. This function is related to and generally precedes the act of acceptance as defined in § 14.001-6. § 14.001–2 Contract quality require

ments. Contract quality requirements means the detailed requisites for quality incumbent on the contractor, consisting of (a) all quality requirements contained in a contract; and (b) the detailed contractual requisites provided by $ 14.101 incumbent on the contractor to substanti

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