PART 245—GOVERNMENT PROPERTY Authority: 41 U.S.C. 1303 and 48 CFR chapter 1. Source: 56 FR 36448, July 31, 1991, unless otherwise noted. Subpart 245.1—General Source: 74 FR 37647, July 29, 2009, unless otherwise noted. 245.101 Definitions. Mapping, charting, and geodesy property, 245.102 Policy. See the policy guidance at PGI 245.102-70. (1) Mapping, charting, and geodesy property. (i) MC&G property shall not be duplicated, copied, or otherwise reproduced for purposes other than those necessary for contract performance. (ii) Upon completion of contract performance, the contracting officer shall— (A) Contact the Director, National Geospatial-Intelligence Agency, 7500 Geoint Drive, Springfield, VA 22150, for disposition instructions; (B) Direct the contractor to destroy or return all Government-furnished MC&G property not consumed during contract performance; and (C) Specify the destination and means of shipment for property to be returned to the Government. (2) Government supply sources. (3) Acquisition and management of industrial resources. (4) GFP identification. (i) It is DoD policy that GFP be tagged, labeled, or marked based on DoD marking standards (MIL Standard 130) or other standards, when the requiring activity determines that such items are subject to serialized item management (serially-managed items). The list of Government-furnished property subject to serialized item management will be identified in the contract in accordance with PGI 245.103-72, Government-furnished property attachments to solicitations and awards. (ii) Exceptions. (A) GFP that was previously tagged, labeled, or marked; (B) Items, as determined by the head of the agency, that are to be used to support a contingency operation; or to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack; (C) Items for which a determination and findings has been executed concluding that it is more cost effective for the Government requiring activity to assign, mark, and register the unique item identification after delivery of an item acquired from a small business concern or a commercial product acquired under FAR part 12 or part 8. ( 1 ( i ( ii ( 2 [email protected]. (D) Items that are contractor-acquired property; (E) Property under any statutory leasing authority; (F) Property to which the Government has acquired a lien or title solely because of partial, advance, progress, or performance-based payments; (G) Intellectual property or software; or (H) Real property. (5) Reporting Government property. [74 FR 37647, July 29, 2009, as amended at 76 FR 3537, Jan. 20, 2011; 76 FR 6006, 6008, Feb. 2, 2011; 80 FR 2021, Jan. 15, 2015; 81 FR 36473, June 7, 2016; 86 FR 3839, Jan. 15, 2021; 88 FR 6588, Jan. 31, 2023; 88 FR 88537, Dec. 22, 2023; 89 FR 11748, Feb. 15, 2024; 89 FR 60832, July 29, 2024] 245.103-70 Furnishing Government property to contractors. Follow the procedures at PGI 245.103-70 for furnishing Government property to contractors. [76 FR 3537, Jan. 20, 2011. Redesignated and amended at 77 FR 76937, Dec. 31, 2012] 245.103-71 Transferring Government property accountability. Follow the procedures at PGI 245.103-71 for transferring Government property accountability. [76 FR 3537, Jan. 20, 2011. Redesignated and amended at 77 FR 76937, Dec. 31, 2012] 245.103-72 Government-furnished property attachments to solicitations and awards. When performance will require the use of GFP, contracting officers shall include the GFP attachment to solicitations and awards. See PGI 245.103-72 for links to the formats and procedures for preparing the GFP attachment. [88 FR 88537, Dec. 22, 2023] 245.103-73 Government property under sustainment contracts. See PGI 245.103-73 for information on the reporting requirements for Government inventory held by contractors under sustainment contracts in accordance with DoD Manual 4140.01, Volume 6, DoD Supply Chain Materiel Management Procedures: Materiel Returns, Retention, and Disposition. [82 FR 61481, Dec. 28, 2017] 245.103-74 Contracting office responsibilities. See PGI 245.103-74 [77 FR 76937, Dec. 31, 2012. Redesignated at 82 FR 61481, Dec. 28, 2017; 83 FR 12681, Mar. 23, 2018] 245.104 Responsibility and liability for Government property. In addition to the contract types listed at FAR 45.104, contractors are not held liable for loss of Government property under negotiated fixed-price contracts awarded on a basis other than submission of certified cost or pricing data. [76 FR 71826, Nov. 18, 2011] 245.105 Contractors' property management system compliance. (a) Definitions. Acceptable property management system Property management system (b) Policy. (1) Determine the acceptability of the system and approve or disapprove the system; and (2) Pursue correction of any weaknesses or deficiencies. (c) In evaluating the acceptability of a contractor's property management system, the contracting officer, in consultation with the property administrator, shall determine whether the contractor's property management system complies with the system criteria for an acceptable property management system as prescribed in the clause at 252.245-7003, Contractor Property Management System Administration. (d) Disposition of findings Reporting of findings. (2) Initial determination. (ii) If the contracting officer finds that there are one or more material weaknesses due to the contractor's failure to meet one or more of the property management system criteria in the clause at 252.245-7003, the contracting officer shall— (A) Promptly make an initial written determination on any material weaknesses and notify the contractor, in writing, providing a description of each material weakness in sufficient detail to allow the contractor to understand the weakness (see PGI 245.105(d)(2)); (B) Request the contractor to respond, in writing, to the initial determination within 30 days and; (C) Evaluate the contractor's response to the initial determination, in consultation with the property administrator, and make a final determination. (3) Final determination. (A) The contractor's property management system is acceptable and approved, and no material weaknesses remain; or (B) Material weaknesses remain. The notice shall identify any remaining material weaknesses and indicate the adequacy of any proposed or completed corrective action. The contracting officer shall— ( 1 ( 2 ( 3 (ii) Follow the procedures relating to monitoring a contractor's corrective action and the correction of material weaknesses in PGI 245.105(d)(3). (e) System approval. (f) Contracting officer notifications. [76 FR 28872, May 18, 2011, as amended at 90 FR 5731, Jan. 17, 2025] 245.107 Contract clauses. (1)(i) In lieu of the prescription at FAR 45.107(d), use the clause at FAR 52.245-1, Government Property, in all purchase orders for repair, maintenance, overhaul, or modification of Government property regardless of the unit acquisition cost of the items to be repaired. (ii) For negotiated fixed-price contracts awarded on a basis other than submission of certified cost or pricing data for which Government property is provided, use the clause at FAR 52.245-1, Government Property, without its Alternate I. (2) Use the clause at 252.245-7000, Government-Furnished Mapping, Charting, and Geodesy Property, in solicitations and contracts when mapping, charting, and geodesy property is to be furnished. (3) Use the clause at 252.245-7003, Contractor Property Management System Administration, in solicitations and contracts containing the clause at FAR 52.245-1, Government Property. (4) Use the clause at 252.245-7005, Management and Reporting of Government Property, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial products and commercial services, that contain the clause at FAR 52.245-1, Government Property. [76 FR 6006, 6008, Feb. 2, 2011, as amended at 76 FR 28872, May 18, 2011; 76 FR 52142, Aug. 19, 2011; 76 FR 71826, Nov. 18, 2011; 84 FR 18162, Apr. 30, 2019; 88 FR 88537, Dec. 22, 2023] Subpart 245.2—Solicitation and Evaluation Procedures Source: 76 FR 3537, Jan. 20, 2011, unless otherwise noted. 245.201 Solicitation. 245.201-70 Security classification. Follow the procedures at PGI 245.201-70 for security classification. [88 FR 88537, Dec. 22, 2023] Subpart 245.3—Authorizing the Use and Rental of Government Property Source: 74 FR 37647, July 29, 2009, unless otherwise noted. 245.302 Contracts with foreign governments or international organizations. (1) General. (i) Approval. (A) The use will not interfere with foreseeable requirements of the United States; (B) The work is undertaken as a DoD foreign military sale; or (C) For a direct commercial sale, the foreign country or international organization would be authorized to contract with the department concerned under the Arms Export Control Act. (ii) Use charges. (A) The Use and Charges clause is applicable on direct commercial sales to foreign governments or international organizations. (B) When a particular foreign government or international organization has funded the acquisition of property, do not assess the foreign government or international organization rental charges or nonrecurring recoupments for the use of such property. (2) Special tooling and special test equipment. (i) DoD normally recovers a fair share of nonrecurring costs of special tooling and special test equipment by including these costs in its calculation of the nonrecurring cost recoupment charge when major defense equipment is sold by foreign military sales or direct commercial sales to foreign governments or international organizations. “Major defense equipment” is defined in DoD Directive 2140.2, Recoupment of Nonrecurring Costs on Sales of U.S. Items, as any item of significant military equipment on the United States Munitions List having a nonrecurring research, development, test, and evaluation cost of more than $50 million or a total production cost of more than $200 million. (ii) When the cost thresholds in paragraph (2)(i) of this section are not met, the contracting officer shall assess rental charges for use of special tooling and special test equipment pursuant to the Use and Charges clause if administratively practicable. (3) Waivers. (i) Rental charges for use of U.S. production and research property on commercial sales transactions to the Government of Canada are waived for all commercial contracts. This waiver is based on an understanding wherein the Government of Canada has agreed to waive its rental charges. (ii) Requests for waiver or reduction of charges for the use of Government property on work for foreign governments or international organizations shall be submitted to the contracting officer, who is authorized to approve the requests in consultation with the appropriate functional specialist. [74 FR 37647, July 29, 2009, as amended at 78 FR 65220, Oct. 31, 2013] Subpart 245.4—Title to Government Property Source: 76 FR 3537, Jan. 20, 2011, unless otherwise noted. 245.402 Title to contractor-acquired property. 245.402-70 Policy. Review the guidance at PGI 245.402-70 with regard to oversight and surveillance of contractor-acquired property. [81 FR 50652, Aug. 2, 2016] 245.402-71 Delivery of contractor-acquired property. Follow the procedures at PGI 245.402-71 for the delivery of contractor-acquired property. Subpart 245.5—Support Government Property Administration Source: 76 FR 52142, Aug. 19, 2011, unless otherwise noted. 245.570 Storage at the Government's expense. All storage contracts or agreements shall be separately priced and shall include all costs associated with the storage. Subpart 245.6—Reporting, Reutilization, and Disposal Source: 76 FR 52142, Aug. 19, 2011, unless otherwise noted. 245.602 Reutilization of Government property. 245.602-1 Inventory disposal schedules. For termination inventory, plant clearance officers shall verify inventory schedules, either directly or through appropriate technical personnel, to determine the following: (a) Allocability. (1) Review contract requirements, delivery schedules, bills of material, and other pertinent documents to determine whether schedules include property that— (i) Is appropriate for use on the contract; or (ii) Exceeds the quantity required for completion of the contract, but could be diverted to other commercial work or Government use. (2) Review the contractor's— (i) Recent purchases of similar material; (ii) Plans for current and scheduled production; (iii) Stock record entries; and (iv) Bills of material for similar items. (b) Quantity. (c) Condition. 245.602-3 Screening. Property will be screened DoD-wide, including the contracting agency, requiring agency, and, as appropriate, the General Services Administration. The requiring agency shall have priority for retention of listed items. All required screening must be completed before any sale of contractor inventory, including contractor inventory in overseas locations (foreign excess personal property) can take place. Upon request of the prospective reutilization, transfer, donation, or sales customer, the plant clearance officer shall arrange for inspection of property at the contractor's plant in such a manner as to avoid interruption of the contractor's operations, and consistent with any security requirements. 245.602-70 Plant clearance procedures. Follow the procedures at PGI 245.602-70 for establishing and processing a plant clearance case. 245.604 Sale of surplus personal property. 245.604-1 Sales procedures. (1) Best value sales approach. e.g., (2) Invitation for bid procedures. (i) Maximum practical competition is obtained; (ii) Sources solicited are recorded; and (iii) Informal bids are confirmed in writing. (3) Sale approval and award. (i) Evaluate bids to establish that the sale price is fair and reasonable, taking into consideration— (A) Knowledge or tests of the market; (B) Current published prices for the property; (C) The nature, condition, quantity, and location of the property; and (D) Past sale history for like or similar items; (ii) Approve award to the responsible bidder whose bid is most advantageous to the Government. The plant clearance officer shall not approve award to any bidder who is an ineligible transferee, as defined in 252.245-7005, Management and Reporting of Government Property; and (iii) Notify the contractor of the bidder to whom an award will be made within 5 working days from receipt of bids. (4) Negotiated sales. (i) Negotiated sales include purchases or retention at less than cost by the contractor. Negotiated sales may be made when— (A) The plant clearance officer determines that this method is essential to expeditious plant clearance; and (B) The Government's interests are adequately protected. (ii) Negotiated sales shall be at fair and reasonable prices, not less than those reasonably expected under competitive sales. (iii) Conditions justifying negotiated sales are— (A) No acceptable bids are received under competitive sale; (B) Anticipated sales proceeds do not warrant competitive sale; (C) Specialized nature of the property would not create bidder interest; (D) Removal of the property would reduce its value or result in disproportionate handling expenses; or (E) Such action is essential to the Government's interests. (5) Plant clearance officers shall consider any special disposal requirements such as demilitarization or trade security control requirements in accordance with DoDM 4160.28-M, Defense Demilitarization Manual, and DoDI 2030.08, Implementation of Trade Security Controls (TSCs) for Transfers of DoD Personal Property to Parties Outside DoD Control, respectively. See [86 FR 59871, Oct. 29, 2021, as amended at 88 FR 88537, Dec. 22, 2023]