ID05180019 RFP Sec H.pdf

USSOCOM T2SDT

ID05180019

Section H

Special Contract Requirements

Contents

H.1 Type and Term of Contract 2 H.2 Kick-off Meeting 2 H.3 Maximum Order Ceiling and Minimum Guarantee 2 H.4 Travel 2 H.5 Protection of Proposal and Contract Information 2 H.6 Contractor Performance Information 2 H.7 Government Delays in Reviewing Deliverables or Furnishing Items 3 H.8 Alternate Dispute Resolution 3 H.9 Ordering Instructions 3

Who is Authorized to Place Orders 3 Order Placement Process – GSA 3 Ordering Period 4 Order Close-Out 4 Federal Procurement Data System – Next Generation (FPDS-NG) Reporting 4

H.10 Data Rights 4 H.11 Limited Use of Data 4 H.12 Ceiling Price Notification 5 H.13 Application of Time and Material Provisions 5

FAR 52.232-20 Limitation of Cost. 5 H.14 Material and Material Handling Costs 5 H.15 Productive Direct Labor Hours 5 H.16 Payment for Unauthorized Work 6 H.17 Special Requirement for Performance Eligibility 6 H.18 Incremental Funding 6 H.19 Government Furnished Property 6 H.20 Executive Compensation and First -Tier Subcontract Reporting 17

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H.1 Type and Term of Contract

This contract is a one year Indefinite Delivery / Indefinite Quantity contract with Firm Fixed Price (FFP), Time and Materials (T&M) and Cost Reimbursable line items. The prices for the items shown in Section B include all costs associated with the performance, delivery, and warranty of all deliverables.

H.2 Kick-off Meeting

There will be a kick-off meeting / conference call for this contract within 14 calendar days after award of the contract, or at such other time as mutually agreed upon by the parties.

H.3 Maximum Order Ceiling and Minimum Guarantee

The Government shall not place orders for more than the total estimated quantities set forth in the final contract document. The Government guarantees that it will place a task/delivery order(s) having a value of at least $100,000.00 over the life of this contract.

H.4 Travel

All travel must be specified in the issued task/delivery order. The cost of transportation, lodging, subsistence and incidental expenses (per diem) incurred by Contractor personnel, when requested to travel in the performance of an order, shall comply with the limitations as set forth in FAR 31.205-46. Travel costs must be consistent with and limited to the approved Government travel regulations (Federal Travel Regulations (FTR) for civilian agency work, Joint Travel Regulations (JTR) for military agency work). All travel shall be pre-approved by the ordering agency.

H.5 Protection of Proposal and Contract Information

In accordance with Federal Acquisition Regulation (FAR) 3.104-4 and 15.207, the Government will take the necessary and usual steps to maintain the confidentiality of information submitted prior to and after award of the contract.

H.6 Contractor Performance Information

In conformance with the Government’s need to record and maintain information on Contractor performance during the life of this contract, the Government will evaluate the manner in which the Contractor performed in accordance with contract requirements such as: quality of products and services; timeliness and adherence to schedules; cost efficiencies and cost control; management in all areas of performance; adherence to contract and federal acquisition system requirements; business relations and commitment to customer satisfaction.

Information obtained as a result of the evaluation(s) may be shared with Government agencies for their use in support of future award decisions (Reference FAR 42.1500).

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H.7 Government Delays in Reviewing Deliverables or Furnishing Items

If Contractor performance or submission of deliverables is contingent upon receipt of Government furnished items (data, equipment, materials, facilities, and support) or input, or upon Government review and approval of interim items or draft documents (collectively referred to as Government Performance), the Government shall specify when it will provide such items or input, or the time it will need to perform reviews or give approvals. If the Government fails to meet item, input, review, or approval deadlines, Contractor performance or submission of deliverables shall automatically be extended one calendar day for each day of Government delay. The Contractor shall promptly advise the Contracting Officer of any delays in receipt of Government furnished items, input, reviews, or approvals. If dates for Government performance are not specified in this contract/order or associated task directives (if used), this clause will not apply, and Contractor delays must be handled or negotiated under other provisions of this contract or order.

H.8 Alternate Dispute Resolution

Alternate Dispute Resolution (ADR) procedures increase the opportunity for relatively inexpensive and expeditious resolution of issues in controversy. These procedures may be used at any time that the Contracting Officer has authority to resolve the issue in controversy. If the Contractor submits a claim, ADR procedures may be applied to all or part of the claim. The Contractor must certify its claim in accordance with FAR 33.207. When ADR procedures are used after the issuance of a Contracting Officer's final decision, the time limitations or procedural requirements for filing an appeal of the Contracting Officer's final decision are not altered.

H.9 Ordering Instructions

Who is Authorized to Place Orders

Funded orders may be placed by the following organizations and individuals.

● GSA, Region 5, FAS Contracting Officers

Order Placement Process – GSA

To initiate a Task/Delivery Order the client agency shall provide GSA with the following:

● A Military Interdepartmental Purchase Request (MIPR), with sufficient funding to (1) purchase the desired Tactical 2-Way Sensor Data Transport Suites (T2SDT) and related equipment/material, travel, training, and support services, (2) pay authorized shipping costs, and (3) cover the GSA processing surcharge. The MIPR shall state that the funds provided are for the purchase of T2SDTs.

● A detailed Statement of Work (SOW) for the Delivery Order or Task Order including as a minimum (a) scope of the effort to be performed or list of items to be delivered; (b) any technical areas to be addressed; (c) any specific O&M and/or R&D to be performed; (d)

H − 3 of 24 reporting requirements; (e) deliverable requirements; and (f) estimated level of effort for training, technical support, and project management.

GSA will solicit quotes from the Contractor. The Government will request that each quote include, as necessary to fulfill the requirement –

● Labor hour level of effort

● Materials

● Anticipated travel

● Proposed time to complete

● List of deliverables

● Price

Client agency and GSA technical representatives will evaluate the quotes to ensure that they are technically compliant, the skills and level of effort of any proposed labor is appropriate for the requirement, and that the price is fair and reasonable. GSA will place the order through the GSA ITSS system.

Ordering Period

Task/Delivery orders may be awarded any time during the one year period of contract performance. Any task/delivery order placed before the end of the contract period may be performed during the period of performance stated in the task/delivery order provided that task/delivery orders that extend beyond the one-year T2SDT contract period must be completed within 12 months after contract expiration.

Order Close-Out

The GSA Contracting Officer is responsible for closing all orders per FAR 4.804 and 4.805.

Federal Procurement Data System – Next Generation (FPDS-NG) Reporting

The GSA Contracting Officer is responsible for recording all orders placed through GSA in the FPDS-NG system.

The client agencies are responsible for furnishing the GSA Contracting Officer with the FIPS 95 funding codes for the Funding Agency ID (FPDS-NG users’ guide 3.4.5) and the Funding Office ID (FPDS-NG user’s guide 3.4.7) to ensure that proper socio-economic credit is given to the client agency. It is important that the client agency ensure that the FIPS 95 codes are as specific as desired. If the client agency finds that its funding IDs are not as specific as it would like, the codes can be updated through the FIPS update process.

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H.10 Data Rights

The Government shall have unlimited rights to all data generated and delivered under this contract and subsequent order(s). This data shall not be used, published, or distributed by the Contractor without specific permission from the Government.

The Government shall have the right to use all commercially developed and privately funded data delivered under this contract or order in accordance with, and subject to, the published agreements and restrictions that accompany that data.

H.11 Limited Use of Data

Performance of this effort may require the Contractor to access and use data and information proprietary to a Government agency or Government Contractor which is of such a nature that its dissemination or use, other than in performance of this effort, would be adverse to the interests of the Government and/or others. Contractor and/or Contractor personnel shall not divulge or release data or information developed or obtained in performance of this effort, until made public by the Government, except to authorized Government personnel who will be identified and given written approval by the authorized Government representative stated in this contract/order.

Nothing herein shall preclude the use of any data independently acquired by the Contractor without such limitations or prohibit an agreement at no cost to the government between the Contractor and the data owner which provides for greater rights to the Contractor.

All data delivered to the Contractor as Government Furnished Data shall remain the property of the Government and shall only be used by the Contractor in the performance of this contract or order. The Government retains all rights to Government Furnished Data.

At the conclusion of this contract/order all Government Furnished Data shall be dealt with according to the disposition instruction provided by the Contracting Office. If the Contracting Officer fails to provide disposition instruction for Government Furnished Data within thirty days of contract/task order end, the Contractor shall return all hard copy data and delete or otherwise destroy all electronic data.

H.12 Ceiling Price Notification

Pertaining to any task/delivery orders that are incrementally funded, per clause 52.232-7, Payments under Time-and-Materials and Labor-Hour Contracts, the Contractor is reminded – “If at any time the Contractor has reason to believe that the hourly rate payments and travel costs that will accrue in performing this contract in the next succeeding 30 days, if added to all other payments and costs previously accrued, will exceed 85 percent of the ceiling price in the Schedule, the Contractor shall notify the Contracting Officer giving a revised estimate of the total price to the Government for performing this contract with supporting reasons and

H − 5 of 24 documentation.”

H.13 Application of Time and Material Provisions

This is a fixed price indefinite delivery / indefinite quantity contract. However, delivery orders under this contract may be placed on a Fixed Price or Time and Material basis using the fixed rates established in Section B of this contract. Other direct costs, travel, and shipping costs are to be billed as direct costs on a reimbursable basis. Other direct costs, travel, and shipping, if included in a delivery/task order, shall be specifically spelled out. Funds to cover these costs will be provided in delivery/task orders placed under this contract. For these costs only, the following contract clauses and the provisions thereof apply, as applicable.

FAR 52.216-7, Allowable Cost and Payment FAR 52.232-20, Limitation of Cost

H.14 Material and Material Handling Costs

Material and material handling costs will be paid as provided in FAR 52.232-7(b) “Payments under Time-and-Materials and Labor-Hour Contracts”. Material overhead will not be authorized if the costs normally included in that overhead (purchasing staff or other material handling costs) are being directly charged to the task/delivery order(s).

H.15 Productive Direct Labor Hours

When the Government places Labor Hour or Time & Material orders under this contract, the Contractor shall only charge for labor hours when work is actually being performed and not for employees in a “ready” status only. For the task/deliver order(s) 1 FTE (full time equivalent) = 1,920 labor hours.

H.16 Payment for Unauthorized Work

The Contractor will not be paid for the performance of work that is not authorized under this contract or any delivery order or task order placed under this contract.

H.17 Special Requirement for Performance Eligibility

There are no special requirements that would preclude a vendor from being eligible to perform this requirement. However, please be aware of the security requirements that may be imposed on the Contractor during performance as found in Section C.

H.18 Incremental Funding

Labor or reimbursable items contained in delivery orders or task orders issued under this contract may be funded on an incremental basis. In this event, the following clause entitled “Incremental Funding – Time and Materials/Labor Hours” is invoked pursuant to GSA R5 AOD Acquisition Letter 3-2009-01 (revised 07-23-09), and will apply to any subsequently placed

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Task/Delivery Order that is incrementally funded.

Incremental Funding – Time and Materials/Labor Hours

The project may be incrementally funded. If incrementally funded, funds shall be added to the contract/order via a unilateral modification as the funds become available. The Contractor shall not perform work resulting in charges to the Government that exceed obligated funds.

The Contractor shall notify the Contracting Officer in writing whenever it has reason to believe that the costs it expects to incur under this contract in the next 60 days, when added to all costs previously incurred, will exceed 75 percent of the total amount so far allotted to the contract/order by the Government. The notice shall state the estimated amount of additional funds required to continue performance of the contract/order for the specified period of performance or completion that task.

Sixty days before the end of the period specified in the Schedule, the Contractor shall notify the Contracting Officer in writing of the estimated amount of additional funds, if any, required to continue timely performance under the contract or for any further period specified in the Schedule or otherwise agreed upon, and when the funds will be required.

The Government is not obligated to reimburse the Contractor for charges in excess of the contract/order funded amount and the Contractor is not obligated to continue performance or otherwise incur costs that could result in charges to the Government in excess of the obligated amount under the contract/order.

H.19 Government Furnished Property

During the course of this contract, the Contractor may be required to use Government Furnished Property or to purchase items or equipment to fulfill the Government’s bona fide need. Accordingly, the provisions of the following clause apply. Contractor purchased items or equipment will become Government property per paragraph (e)(3) of this clause. Government Property will be disposed of at the end of this contract per Contracting Officer Disposition Instruction in accordance with paragraph (j)(2)(i)(A) of this clause. In the absence of a Contracting Officer Disposition Instruction, all Government property, whether furnished by the Government or purchased on behalf of the Government, shall be returned to USSOCOM within 60 days of contract or task order completion, whichever occurs last. The Contractor shall coordinate the delivery logistics of Government property returns with the USSOCOM CR or ACR.

NOTE: In addition to, or in place of, the applicable provision of the Government Property clause, below, the Contractor shall have the responsibility to conserve and protect Government resources. The Contractor shall repair any Government-owned equipment, which is damaged through or by the fault of the Contractor, with equipment of equal or better quality, at no cost

H − 7 of 24 to the Government. All repairs and/or replacements of GFE/GFP must be pre-approved by the CR and/or ACR.

FAR 52.245-1 Government Property (APR 2012)

(a) Definitions. As used in this clause—

“Cannibalize” means to remove parts from Government property for use or for installation on other Government property.

“Contractor-acquired property” means property acquired, fabricated, or otherwise provided by the Contractor for performing a contract, and to which the Government has title.

“Contractor inventory” means—

(1) Any property acquired by and in the possession of a Contractor or subcontractor under a contract for which title is vested in the Government and which exceeds the amounts needed to complete full performance under the entire contract;

(2) Any property that the Government is obligated or has the option to take over under any type of contract, e.g., as a result either of any changes in the specifications or plans thereunder or of the termination of the contract (or subcontract thereunder), before completion of the work, for the convenience or at the option of the Government; and

(3) Government-furnished property that exceeds the amounts needed to complete full performance under the entire contract.

“Contractor's managerial personnel” means the Contractor's directors, officers, managers, superintendents, or equivalent representatives who have supervision or direction of—

(1) All or substantially all of the Contractor's business;

(2) All or substantially all of the Contractor's operation at any one plant or separate location;

or

(3) A separate and complete major industrial operation.

“Demilitarization” means rendering a product unusable for, and not restorable to, the purpose for which it was designed or is customarily used.

“Discrepancies incident to shipment” means any differences (e.g., count or condition) between the items documented to have been shipped and items actually received.

“Equipment” means a tangible item that is functionally complete for its intended purpose, durable, nonexpendable, and needed for the performance of a contract. Equipment is not intended for sale, and does not ordinarily lose its identity or become a component part of another article when put into use. Equipment does not include material, real property, special test equipment or special tooling.

“Government-furnished property” means property in the possession of, or directly acquired by, the Government and subsequently furnished to the Contractor for performance of a

H − 8 of 24 contract. Government-furnished property includes, but is not limited to, spares and property furnished for repair, maintenance, overhaul, or modification. Government-furnished property also includes Contractor-acquired property if the Contractor-acquired property is a deliverable under a cost contract when accepted by the Government for continued use under the contract.

“Government property” means all property owned or leased by the Government.

Government property includes both Government-furnished and Contractor-acquired property.

Government property includes material, equipment, special tooling, special test equipment, and real property. Government property does not include intellectual property and software.

“Loss of Government Property” means unintended, unforeseen or accidental loss, damage or destruction to Government property that reduces the Government’s expected economic benefits of the property. Loss of Government property does not include purposeful destructive testing, obsolescence, normal wear and tear or manufacturing defects. Loss of Government property includes, but is not limited to—

(1) Items that cannot be found after a reasonable search:

(2) Theft:

(3) Damage resulting in unexpected harm to property requiring repair to restore the item to usable condition; or

(4) Destruction resulting from incidents that render the item useless for its intended purpose or beyond economical repair.

“Material” means property that may be consumed or expended during the performance of a contract, component parts of a higher assembly, or items that lose their individual identity through incorporation into an end item. Material does not include equipment, special tooling, special test equipment or real property.

“Nonseverable” means property that cannot be removed after construction or installation without substantial loss of value or damage to the installed property or to the premises where installed.

“Precious metals” means silver, gold, platinum, palladium, iridium, osmium, rhodium, and ruthenium.

“Production scrap” means unusable material resulting from production, engineering, operations and maintenance, repair, and research and development contract activities.

Production scrap may have value when re-melted or reprocessed, e.g., textile and metal clippings, borings, and faulty castings and forgings.

“Property” means all tangible property, both real and personal.

“Property Administrator” means an authorized representative of the Contracting Officer appointed in accordance with agency procedures, responsible for administering the contract requirements and obligations relating to Government property in the possession of a

Contractor.

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“Property records” means the records created and maintained by the Contractor in support of its stewardship responsibilities for the management of Government property.

“Provide” means to furnish, as in Government-furnished property, or to acquire, as in

Contractor-acquired property.

“Real property” See Federal Management Regulation 102-71.20 (41 CFR 102-71.20).

“Sensitive property” means property potentially dangerous to the public safety or security if stolen, lost, or misplaced, or that shall be subject to exceptional physical security, protection, control, and accountability. Examples include weapons, ammunition, explosives, controlled substances, radioactive materials, hazardous materials or wastes, or precious metals.

“Unit acquisition cost” means—

(1) For Government-furnished property, the dollar value assigned by the Government and identified in the contract; and

(2) For Contractor-acquired property, the cost derived from the Contractor’s records that reflect consistently applied generally accepted accounting principles.

(b) Property management.

(1) The Contractor shall have a system of internal controls to manage (control, use, preserve, protect, repair and maintain) Government property in its possession. The system shall be adequate to satisfy the requirements of this clause. In doing so, the Contractor shall initiate and maintain the processes, systems, procedures, records, and methodologies necessary for effective and efficient control of Government property. The Contractor shall disclose any significant changes to its property management system to the Property Administrator prior to implementation of the changes. The Contractor may employ customary commercial practices, voluntary consensus standards, or industry-leading practices and standards that provide effective and efficient Government property management that are necessary and appropriate for the performance of this contract (except where inconsistent with law or regulation).

(2) The Contractor's responsibility extends from the initial acquisition and receipt of property, through stewardship, custody, and use until formally relieved of responsibility by authorized means, including delivery, consumption, expending, sale (as surplus property), or other disposition, or via a completed investigation, evaluation, and final determination for lost property. This requirement applies to all Government property under the Contractor's accountability, stewardship, possession or control, including its vendors or subcontractors (see paragraph (f)(1)(v) of this clause).

(3) The Contractor shall include the requirements of this clause in all subcontracts under which Government property is acquired or furnished for subcontract performance.

(4) The Contractor shall establish and maintain procedures necessary to assess its property management system effectiveness and shall perform periodic internal reviews, surveillances, H − 10 of 24 self assessments, or audits. Significant findings or results of such reviews and audits pertaining to Government property shall be made available to the Property Administrator.

(c) Use of Government property.

(1) The Contractor shall use Government property, either furnished or acquired under this contract, only for performing this contract, unless otherwise provided for in this contract or approved by the Contracting Officer.

(2) Modifications or alterations of Government property are prohibited, unless they are—

(i) Reasonable and necessary due to the scope of work under this contract or its terms and conditions;

(ii) Required for normal maintenance; or

(iii) Otherwise authorized by the Contracting Officer.

(3) The Contractor shall not cannibalize Government property unless otherwise provided for in this contract or approved by the Contracting Officer.

(d) Government-furnished property.

(1) The Government shall deliver to the Contractor the Government-furnished property described in this contract. The Government shall furnish related data and information needed for the intended use of the property. The warranties of suitability of use and timely delivery of

Government-furnished property do not apply to property acquired or fabricated by the

Contractor as Contractor-acquired property and subsequently transferred to another contract with this Contractor.

(2) The delivery and/or performance dates specified in this contract are based upon the expectation that the Government-furnished property will be suitable for contract performance and will be delivered to the Contractor by the dates stated in the contract.

(i) If the property is not delivered to the Contractor by the dates stated in the contract, the

Contracting Officer shall, upon the Contractor's timely written request, consider an equitable adjustment to the contract.

(ii) In the event property is received by the Contractor, or for Government-furnished property after receipt and installation, in a condition not suitable for its intended use, the

Contracting Officer shall, upon the Contractor's timely written request, advise the Contractor on a course of action to remedy the problem. Such action may include repairing, replacing, modifying, returning, or otherwise disposing of the property at the Government's expense.

Upon completion of the required action(s), the Contracting Officer shall consider an equitable adjustment to the contract (see also paragraph (f)(1)(ii)(A) of this clause).

(iii) The Government may, at its option, furnish property in an “as-is” condition. The

Contractor will be given the opportunity to inspect such property prior to the property being provided. In such cases, the Government makes no warranty with respect to the serviceability

H − 11 of 24 and/or suitability of the property for contract performance. Any repairs, replacement, and/or refurbishment shall be at the Contractor's expense.

(3)(i) The Contracting Officer may by written notice, at any time—

(A) Increase or decrease the amount of Government-furnished property under this contract;

(B) Substitute other Government-furnished property for the property previously furnished, to be furnished, or to be acquired by the Contractor for the Government under this contract; or

(C) Withdraw authority to use property.

(ii) Upon completion of any action(s) under paragraph (d)(3)(i) of this clause, and the

Contractor's timely written request, the Contracting Officer shall consider an equitable adjustment to the contract.

(e) Title to Government property.

(1) All Government-furnished property and all property acquired by the Contractor, title to which vests in the Government under this paragraph (collectively referred to as “Government property”), is subject to the provisions of this clause. The Government shall retain title to all

Government-furnished property. Title to Government property shall not be affected by its incorporation into or attachment to any property not owned by the Government, nor shall

Government property become a fixture or lose its identity as personal property by being attached to any real property.

(2) Title vests in the Government for all property acquired or fabricated by the Contractor in accordance with the financing provisions or other specific requirements for passage of title in the contract. Under fixed price type contracts, in the absence of financing provisions or other specific requirements for passage of title in the contract, the Contractor retains title to all property acquired by the Contractor for use on the contract, except for property identified as a deliverable end item. If a deliverable item is to be retained by the Contractor for use after inspection and acceptance by the Government, it shall be made accountable to the contract through a contract modification listing the item as Government-furnished property.

(3) Title under Cost-Reimbursement or Time-and-Material Contracts or Cost-Reimbursable contract line items under Fixed-Price contracts.

(i) Title to all property purchased by the Contractor for which the Contractor is entitled to be reimbursed as a direct item of cost under this contract shall pass to and vest in the Government upon the vendor's delivery of such property.

(ii) Title to all other property, the cost of which is reimbursable to the Contractor, shall pass to and vest in the Government upon—

(A) Issuance of the property for use in contract performance;

(B) Commencement of processing of the property for use in contract performance; or

(C) Reimbursement of the cost of the property by the Government, whichever occurs first.

(f) Contractor plans and systems.

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(1) Contractors shall establish and implement property management plans, systems, and procedures at the contract, program, site or entity level to enable the following outcomes:

(i) Acquisition of Property. The Contractor shall document that all property was acquired consistent with its engineering, production planning, and property control operations.

(ii) Receipt of Government Property. The Contractor shall receive Government property and document the receipt, record the information necessary to meet the record requirements of paragraph (f)(1)(iii)(A)(1) through (5) of this clause, identify as Government owned in a manner appropriate to the type of property (e.g., stamp, tag, mark, or other identification), and manage any discrepancies incident to shipment.

(A) Government-furnished property. The Contractor shall furnish a written statement to the

Property Administrator containing all relevant facts, such as cause or condition and a recommended course(s) of action, if overages, shortages, or damages and/or other discrepancies are discovered upon receipt of Government-furnished property.

(B) Contractor-acquired property. The Contractor shall take all actions necessary to adjust for overages, shortages, damage and/or other discrepancies discovered upon receipt, in shipment of Contractor-acquired property from a vendor or supplier, so as to ensure the proper allocability and allowability of associated costs.

(iii) Records of Government property. The Contractor shall create and maintain records of all

Government property accountable to the contract, including Government-furnished and

Contractor-acquired property.

(A) Property records shall enable a complete, current, auditable record of all transactions and shall, unless otherwise approved by the Property Administrator, contain the following:

(1) The name, part number and description, National Stock Number (if needed for additional item identification tracking and/or disposition) and other data elements as necessary and required in accordance with the terms and conditions of the contract.

(2) Quantity received (or fabricated), issued, and balance-on-hand.

(3) Unit acquisition cost.

(4) Unique-item identifier or equivalent (if available and necessary for individual item tracking).

(5) Unit of measure.

(6) Accountable contract number or equivalent code designation.

(7) Location.

(8) Disposition.

(9) Posting reference and date of transaction.

(10) Date placed in service (if required in accordance with the terms and conditions of the contract).

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(B) Use of a Receipt and Issue System for Government Material. When approved by the

Property Administrator, the Contractor may maintain, in lieu of formal property records, a file of appropriately cross-referenced documents evidencing receipt, issue, and use of material that is issued for immediate consumption.

(iv) Physical inventory. The Contractor shall periodically perform, record, and disclose physical inventory results. A final physical inventory shall be performed upon contract completion or termination. The Property Administrator may waive this final inventory requirement, depending on the circumstances (e.g., overall reliability of the Contractor's system or the property is to be transferred to a follow-on contract).

(v) Subcontractor control.

(A) The Contractor shall award subcontracts that clearly identify items to be provided and the extent of any restrictions or limitations on their use. The Contractor shall ensure appropriate flow down of contract terms and conditions (e.g., extent of liability for loss of Government property).

(B) The Contractor shall assure its subcontracts are properly administered and reviews are periodically performed to determine the adequacy of the subcontractor's property management system.

(vi) Reports. The Contractor shall have a process to create and provide reports of discrepancies, loss of Government property, physical inventory results, audits and self-assessments, corrective actions, and other property related reports as directed by the

Contracting Officer.

(vii) Relief of stewardship responsibility and liability. The Contractor shall have a process to enable the prompt recognition, investigation, disclosure and reporting of loss of Government property, including losses that occur at subcontractor or alternate site locations.

(A) This process shall include the corrective actions necessary to prevent recurrence.

(B) Unless otherwise directed by the Property Administrator, the Contractor shall investigate and report to the Government all incidents of property loss as soon as the facts become known.

Such reports shall, at a minimum, contain the following information:

(1) Date of incident (if known).

(2) The data elements required under paragraph (f)(1)(iii)(A) of this clause.

(3) Quantity.

(4) Accountable contract number.

(5) A statement indicating current or future need.

(6) Unit acquisition cost, or if applicable, estimated sales proceeds, estimated repair or replacement costs.

(7) All known interests in commingled material of which includes Government material.

(8) Cause and corrective action taken or to be taken to prevent recurrence.

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(9) A statement that the Government will receive compensation covering the loss of

Government property, in the event the Contractor was or will be reimbursed or compensated.

(10) Copies of all supporting documentation.

(11) Last known location.

(12) A statement that the property did or did not contain sensitive, export controlled, hazardous, or toxic material, and that the appropriate agencies and authorities were notified.

(C) Unless the contract provides otherwise, the Contractor shall be relieved of stewardship responsibility and liability for property when—

(1) Such property is consumed or expended, reasonably and properly, or otherwise accounted for, in the performance of the contract, including reasonable inventory adjustments of material as determined by the Property Administrator;

(2) Property Administrator grants relief of responsibility and liability for loss of Government property;

(3) Property is delivered or shipped from the Contractor’s plant, under Government instructions, except when shipment is to a subcontractor or other location of the Contractor; or

(4) Property is disposed of in accordance with paragraphs (j) and (k) of this clause.

(viii) Utilizing Government property.

(A) The Contractor shall utilize, consume, move, and store Government Property only as authorized under this contract. The Contractor shall promptly disclose and report Government property in its possession that is excess to contract performance.

(B) Unless otherwise authorized in this contract or by the Property Administrator the

Contractor shall not commingle Government material with material not owned by the

Government.

(ix) Maintenance. The Contractor shall properly maintain Government property. The

Contractor's maintenance program shall enable the identification, disclosure, and performance of normal and routine preventative maintenance and repair. The Contractor shall disclose and report to the Property Administrator the need for replacement and/or capital rehabilitation.

(x) Property closeout. The Contractor shall promptly perform and report to the Property

Administrator contract property closeout, to include reporting, investigating and securing closure of all loss of Government property cases; physically inventorying all property upon termination or completion of this contract; and disposing of items at the time they are determined to be excess to contractual needs.

(2) The Contractor shall establish and maintain Government accounting source data, as may be required by this contract, particularly in the areas of recognition of acquisitions, loss of

Government property, and disposition of material and equipment.

(g) Systems analysis.

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(1) The Government shall have access to the Contractor's premises and all Government property, at reasonable times, for the purposes of reviewing, inspecting and evaluating the

Contractor's property management plan(s), systems, procedures, records, and supporting documentation that pertains to Government property. This access includes all site locations and, with the Contractor’s consent, all subcontractor premises.

(2) Records of Government property shall be readily available to authorized Government personnel and shall be appropriately safeguarded.

(3) Should it be determined by the Government that the Contractor's (or subcontractor’s) property management practices are inadequate or not acceptable for the effective management and control of Government property under this contract, or present an undue risk to the Government, the Contractor shall prepare a corrective action plan when requested by the Property Administer and take all necessary corrective actions as specified by the schedule within the corrective action plan.

(4) The Contractor shall ensure Government access to subcontractor premises, and all

Government property located at subcontractor premises, for the purposes of reviewing, inspecting and evaluating the subcontractor's property management plan, systems, procedures, records, and supporting documentation that pertains to Government property.

(h) Contractor Liability for Government Property.

(1) Unless otherwise provided for in the contract, the Contractor shall not be liable for loss of

Government property furnished or acquired under this contract, except when any one of the following applies—

(i) The risk is covered by insurance or the Contractor is otherwise reimbursed (to the extent of such insurance or reimbursement). The allowability of insurance costs shall be determined in accordance with 31.205-19.

(ii) Loss of Government property that is the result of willful misconduct or lack of good faith on the part of the Contractor's managerial personnel.

(iii) The Contracting Officer has, in writing, revoked the Government's assumption of risk for loss of Government property due to a determination under paragraph (g) of this clause that the

Contractor's property management practices are inadequate, and/or present an undue risk to the Government, and the Contractor failed to take timely corrective action. If the Contractor can establish by clear and convincing evidence that the loss of Government property occurred while the Contractor had adequate property management practices or the loss did not result from the Contractor's failure to maintain adequate property management practices, the

Contractor shall not be held liable.

(2) The Contractor shall take all reasonable actions necessary to protect the property from further loss. The Contractor shall separate the damaged and undamaged property, place all the

H − 16 of 24 affected property in the best possible order, and take such other action as the Property

Administrator directs.

(3) The Contractor shall do nothing to prejudice the Government's rights to recover against third parties for any loss of Government property.

(4) The Contractor shall reimburse the Government for loss of Government property, to the extent that the Contractor is financially liable for such loss, as directed by the Contracting

Officer.

(5) Upon the request of the Contracting Officer, the Contractor shall, at the Government's expense, furnish to the Government all reasonable assistance and cooperation, including the prosecution of suit and the execution of instruments of assignment in favor of the Government in obtaining recovery.

(i) Equitable adjustment. Equitable adjustments under this clause shall be made in accordance with the procedures of the Changes clause. However, the Government shall not be liable for breach of contract for the following:

(1) Any delay in delivery of Government-furnished property.

(2) Delivery of Government-furnished property in a condition not suitable for its intended use.

(3) An increase, decrease, or substitution of Government-furnished property.

(4) Failure to repair or replace Government property for which the Government is responsible. Standard Form 1428.

(j) Contractor inventory disposal. Except as otherwise provided for in this contract, the

Contractor shall not dispose of Contractor inventory until authorized to do so by the Plant

Clearance Officer or authorizing official.

(1) Predisposal requirements.

(i) If the Contractor determines that the property has the potential to fulfill requirements under other contracts, the Contractor, in consultation with the Property Administrator, shall request that the Contracting Officer transfer the property to the contract in question, or provide authorization for use, as appropriate. In lieu of transferring the property, the

Contracting Officer may authorize the Contractor to credit the costs of Contractor-acquired property (material only) to the losing contract, and debit the gaining contract with the corresponding cost, when such material is needed for use on another contract. Property no longer needed shall be considered Contractor inventory.

(ii) For any remaining Contractor-acquired property, the Contractor may purchase the property at the unit acquisition cost if desired or make reasonable efforts to return unused property to the appropriate supplier at fair market value (less, if applicable, a reasonable restocking fee that is consistent with the supplier's customary practices.)

(2) Inventory disposal schedules.

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(i) Absent separate contract terms and conditions for property disposition, and provided the property was not reutilized, transferred, or otherwise disposed of, the Contractor, as directed by the Plant Clearance Officer or authorizing official, shall use Standard Form 1428, Inventory

Disposal Schedule or electronic equivalent, to identify and report—

(A) Government-furnished property that is no longer required for performance of this contract;

(B) Contractor-acquired property, to which the Government has obtained title under paragraph (e) of this clause, which is no longer required for performance of that contract; and

(C) Termination inventory.

(ii) The Contractor may annotate inventory disposal schedules to identify property the

Contractor wishes to purchase from the Government, in the event that the property is offered for sale.

(iii) Separate inventory disposal schedules are required for aircraft in any condition, flight safety critical aircraft parts, and other items as directed by the Plant Clearance Officer

(iv) The Contractor shall provide the information required by FAR 52.245-1(f)(1)(iii) along with the following:

(A) Any additional; information that may facilitate understanding of the property’s intended use.

(B) For work-in-progress, the estimated percentage of completion.

(C) For precious metals in raw or bulk form, the type of metal and estimated weight.

(D) For hazardous material or property contaminated with hazardous material, the type of hazardous material.

(E) For metals in mill product form, the form, shape, treatment, hardness, temper, specification (commercial or Government) and dimensions (thickness, width and length).

(v) Property with the same description, condition code, and reporting location may be grouped in a single line item.

(vi) Scrap should be reported by “lot” along with metal content, estimated weight and estimated value.

(3) Submission requirements.

(i) The Contractor shall submit inventory disposal schedules to the Plant Clearance Officer no later than—

(A) 30 days following the Contractor's determination that a property item is no longer required for performance of this contract;

(B) 60 days, or such longer period as may be approved by the Plant Clearance Officer, following completion of contract deliveries or performance; or

(C) 120 days, or such longer period as may be approved by the Termination Contracting

Officer, following contract termination in whole or in part.

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(ii) Unless the Plant Clearance Officer determines otherwise, the Contractor need not identify or report production scrap on inventory disposal schedules, and may process and dispose of production scrap in accordance with its own internal scrap procedures. The processing and disposal of other types of Government-owned scrap will be conducted in accordance with the terms and conditions of the contract or Plant Clearance Officer direction, as appropriate.

(4) Corrections. The Plant Clearance Officer may—

(i) Reject a schedule for cause (e.g., contains errors, determined to be inaccurate); and

(ii) Require the Contractor to correct an inventory disposal schedule.

(5) Postsubmission adjustments. The Contractor shall notify the Plant Clearance Officer at least 10 working days in advance of its intent to remove an item from an approved inventory disposal schedule. Upon approval of the Plant Clearance Officer, or upon expiration of the notice period, the Contractor may make the necessary adjustments to the inventory schedule.

(6) Storage.

(i) The Contractor shall store the property identified on an inventory disposal schedule pending receipt of disposal instructions. The Government's failure to furnish disposal instructions within 120 days following acceptance of an inventory disposal schedule may entitle the Contractor to an equitable adjustment for costs incurred to store such property on or after the 121st day.

(ii) The Contractor shall obtain the Plant Clearance Officer's approval to remove property from the premises where the property is currently located prior to receipt of final disposition instructions. If approval is granted, any costs incurred by the Contractor to transport or store the property shall not increase the price or fee of any Government contract. The storage area shall be appropriate for assuring the property's physical safety and suitability for use. Approval does not relieve the Contractor of any liability for such property under this contract.

(7) Disposition instructions.

(i) The Contractor shall prepare for shipment, deliver f.o.b. origin, or dispose of Contractor inventory as directed by the Plant Clearance Officer. Unless otherwise directed by the

Contracting Officer or by the Plant Clearance Officer, the Contractor shall remove and destroy any markings identifying the property as U.S. Government-owned property prior to its disposal.

(ii) The Contracting Officer may require the Contractor to demilitarize the property prior to shipment or disposal. In such cases, the Contractor may be entitled to an equitable adjustment under paragraph (i) of this clause.

(8) Disposal proceeds. As directed by the Contracting Officer, the Contractor shall credit the net proceeds from the disposal of Contractor inventory to the contract, or to the Treasury of the United States as miscellaneous receipts.

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(9) Subcontractor inventory disposal schedules. The Contractor shall require its

Subcontractors to submit inventory disposal schedules to the Contractor in accordance with the requirements of paragraph (j)(3) of this clause.

(k) Abandonment of Government property.

(1) The Government shall not abandon sensitive property or termination inventory without the Contractor's written consent.

(2) The Government, upon notice to the Contractor, may abandon any nonsensitive property in place, at which time all obligations of the Government regarding such property shall cease.

(3) Absent contract terms and conditions to the contrary, the Government may abandon parts removed and replaced from property as a result of normal maintenance actions, or removed from property as a result of the repair, maintenance, overhaul, or modification process.

(4) The Government has no obligation to restore or rehabilitate the Contractor's premises under any circumstances; however, if Government-furnished property is withdrawn or is unsuitable for the intended use, or if other Government property is substituted, then the equitable adjustment under paragraph (i) of this clause may properly include restoration or rehabilitation costs.

(l) Communication. All communications under this clause shall be in writing.

(m) Contracts outside the United States.