(2) Total funds currently available for payment and allotted to this contract are $of which $represents the estimated reimbursable costs and $ represents the fixed fee. For further provisions on funding, see the "Limitation of Funds" clause.

(3) It is estimated that the amount currently allotted will cover performance of Phase I which is scheduled to be completed by-(date). (4) The Contracting Officer may allot additional funds to the contract without the concurrence of the Contractor.

Subpart 3-50.7-Department-wide Contract Information System (DCIS)

SOURCE: 41 FR 52676, Dec. 1, 1976, unless otherwise noted.

§ 3-50.700 Scope of subpart.

This subpart implements the Department-wide Contract Information System (DCIS).

§ 3-50.701 Purpose.

The Department-wide Contract Information System (DCIS) has been developed and implemented to provide the Secretary with accurate and timely data on the Department's procurement activities. The DCIS consolidates postaward contract data reported by contracting offices and provides the capability for generating most summary reports on procurement that are needed to satisfy Federal statutory or administrative reporting requirements and Congressional and public inquiries. The data accumulated by the DCIS may also be used to evaluate the Department's procurement sys

§ 3-56.101-1 Property.

(a) Real property. Buildings, grounds, and structures including building service equipment permanently installed in or attached to buildings and structures and which become a part of real property for the purpose of rendering the building or structure usable or habitable (includes items normally required for the functional use of buildings and structures, such as heating and air conditioning systems, light fixtures, elevators, fire protection systems, etc.) which, installed, becomes an integral part of real property (i.e., lands and buildings).

(b) Personal property. Property of any kind or any interest therein, except real property and records of the Federal Government.

83-56.101-2 Government property.

Government property is all property provided at Government expense re

gardless of the method by which it is acquired, title to which is vested in the Government. Government property is categorized as follows:

(a) Government-furnished property is Government property in the possession of, or acquired directly by the Government and delivered or otherwise made available to, the contractor.

(b) Contractor-acquired property is property procured or otherwise obtained by the contractor through sources other than the Government for performance of an HHS contract, title to which is vested in the Government.

(c) Contractor inventory. (1) Any property acquired by and in the possession of a contractor or subcontractor (including Government-furnished property) under a contract pursuant to the terms of which title is vested in the Government; and (2) any property which the Government by contract clause is obligated or has the option to take over under any type of contract.

§ 3-56.101-3 Equipment.

The term "equipment" means any item of mechanical, electronic, medical, technical, or scientific property as well as office furniture and machines having a useful life expectancy of 1 year or more. Capitalization of equipment is prescribed in Subpart 10327.54 of the HHS Materiel Management Manual (HHSMMM), covering accounting and control of contractor inventories.

§ 3-56.101-4 Facilities contract.

Facilities contract means a contract under which Government real and/or personal property is provided to a contractor or subcontractor by the Government for use in connection with the performance of a separate contract or contracts for supplies or services. However, it should be noted that the Public Health Service is the only principal operating component that can award a facilities contract providing for the furnishing or acquiring of real property or nonseverable property by a contractor (See § 3-56.204). All other operating components can authorize a contractor to acquire personal property or severable property only.

§ 3-56.101-5 Nonprofit organization.

Nonprofit organization means any corporation, foundation, trust, or institution operated for scientific, educational, or medical purposes, not organized for profit, and no part of the net earnings contributes to the benefit of any private shareholder or individual.

§ 3-56.101-6 Miscellaneous terms.

(a) Provide, as used in the context of such phrases as "Government property provided to the contractor," means either to furnish, as in "Governmentfurnished property," or to permit the contractor to acquire, as in "contractor-acquired property."

(b) Nonseverable, when used in conjunction with Government property, means property that cannot be removed after erection or installation without substantial loss of value or damage to it or to the premises where installed.

(c) Procurement contract means a Government contract or subcontract for supplies or services of any description, where the Government may authorize, or authorizes, the use of Government property provided under a facilities contract in its performance.

83-56.102 Responsibility and liability for Government property.

§ 3-56.102-1 Prime contractors.

It is the policy not to hold a contractor responsible for loss of property except for loss, destruction, or damage resulting from willful misconduct or lack of good faith of any of the contractor's in managerial personnel maintaining and administering the program for maintenance, repair, protection and preservation of the property, when Government property is provided under:

(a) A facilities contract; or

(b) A negotiated fixed-price procurement contract where the price is not based on:

(1) Adequate price competition,

(2) Established catalog or market prices of commercial items sold in substantial quantities to the general public, and

(3) Prices set by law or regulation (see § 1-3.807-3 of this title); or

(a) If Government property is provided to a subcontractor directly by the Government, the policy set forth in § 3-56.102-1 shall apply.

(b) If Government property is provided to a subcontractor by a prime contractor, the prime contractor shall be required to hold the subcontractor liable for any loss of or damage to such property. If the prime contract falls under either paragraph (b) or (c) of § 3-56.102-1, the prime contractor may, with the prior approval of the contracting officer, include in any cost-reimbursement type subcontract a provision similar to that referenced in §3-56.602(b). In any fixed-price-type subcontract meeting the criteria set forth in § 3-56.102-1(b), the prime contractor may include a provision similar to that referenced in § 3-56.602(b) after obtaining the approval of the contracting officer.

(c) Contracting officers, prior to approving the inclusion of the provisions referred to in paragraph (b) of this section in any subcontract, shall balance the need for the protection and care of Government property against the cost thereof. A prime contractor who provides Government property to a subcontractor shall not be relieved of any responsibility to the Government that he may have under the terms of the contract.

§ 3-56.103 Profits and fees.

No fee is to be provided or allowed a contractor under a facilities contract. Where Government property is provided under a facilities contract, profit or fee shall be considered in the negotiation of the related procurement contract or contracts for products or services consistent with the profit guidelines established in § 1-3.808.

§ 3-56.104 Use for or by contractors of property owned and operated by the Government.

The on-site use for or by contracts of existing Government-owned property (such as test and other facilities) located at installations owned and operated by the Government may be authorized

in connection with the performance of Government contracts only when:

(a) There is no commercial capability adequate for the needs; or

(b) Substantial cost savings will result from use of the Governmentowned property.

Whenever any such use is authorized, adequate consideration comparable to commercial charges, if any, shall be obtained under the affected contract.

Subpart 3-56.2—Providing Government Property to Contractors

§ 3-56.201 Providing property.

(a) It is HHS policy that property required in the performance of Government contracts will be furnished by the contractor. However, a contractor may be provided Government property or allowed to acquire such property at Government expense if authorized by the principal official responsible for procurement upon determination that:

(1) No practicable or economical alternative exists; e.g., procurement from other sources, utilization of subcontractors, rental of property, or modification of program project requirements, etc.;

(2) The Government receives adequate consideration for providing the property; or

(3) Furnishing Government property is likely to result in substantially lower cost to the Government for the items produced or services rendered when all costs involved (e.g., transportation, installation, modification, maintenance, etc.) are compared with the cost to the Government of the contractor's use of privately-owned property.

(b) The determination that it is necessary to provide a contractor or subcontractor with property will be evidenced by a written justification signed by the contracting officer and the official responsible for management of the program involved and submitted to the principal official responsible for procurement for approval. The justification will:

(1) Explain the necessity for providing property;

(2) Describe the kind, quantity, and estimated cost of the individual items to be provided; and

(3) If necessary, request authorization for the expenditure of appropriated funds for providing the property and furnish a fund citation obtained from the fiscal office.

(c) If the program manager is aware, prior to the request for a contract, that it will be necessary to provide prospective contractors with property, a written justification must accompany the request for a contract to the procurement activity.

(d) If after award of a contract it is determined that property is required or modifications and/or additions to property provided are necessary, a justification as required under paragraph (b) of this section will be executed and provided to the approving authority.

(e) Permanent improvements, other than foundations and similar improvements essential for installation of equipment, may not be made to private property unless authorized by law.

(f) New construction or improvements to real property having general utility shall not be provided with appropriations for research or development unless authorized by law.

(g) Contracting officers shall ensure that solicitation documents:

(1) Require prospective contractors to identify Government-owned property in their possession and/or property acquired from Federal funds, where title vests in the contractor, which is proposed to be used in the performance of the contract (see §§ 3-56.402 and 3-56.403). The prospective contractor must provide written authorization from the cognizant contracting officer of the Federal agency owning the referenced property.

(2) Require prospective contractors to state in writing the property required to fulfill the contract, and the property which they do not have available for the contract, along with the estimated cost and nature of such items, and whether the contractors will furnish the items with their funds.

(3) Inform the prospective contractors of the Government's intention to

provide property and list the property to be provided, if any.

§ 3-56.202 Use of facilities contract.

When Government facilities are to be provided to a contractor, a facilities contract shall be used, except as provided below:

(a) The acquisition value of the property (real and personal) to be provided a contractor does not exceed $50,000 (provide for the use of the property in this instance in the procurement contract);

(b) The contract is for the performance of work within an establishment of or installation operated by the Government; or

(c) The contract is for the performance of services involving the operation of a Government-owned facility, and the property provided is to be used only in connection with that contract.

§ 3-56.203 Loans of Government property.

Subpart 103-27.56 of the HHSMMM provides for the loan of personal property to activities outside the Government other than in connection with a procurement or separate facilities contract with HHS. Accordingly, the kinds of loans described in subpart 103-27.56 would not come under the purview of this part 3-56.

§ 3-56.204 Providing Government property when disposal is limited (nonseverable, etc.).

(a) Nonseverable property. Government property, other than foundations and similar improvements necessary for the installation of equipment, shall not be installed or constructed on land not owned by the Government in a fashion as to become nonseverable unless the principal operating component doing so is the Public Health Service, the only principal operating component to possess such authority. Accordingly, a contract for research or development, or both, may provide for the acquisition of construction by, or furnishing to, the contractor, of research, developmental or test facilities and equipment and can be awarded by PHS upon a determination by the Assistant Secretary for Health that: