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What are the COR's roles on the contract with regard to government property?

The COR will need to perform the following tasks:

1. Identify what, if any, government property will be needed for proposed procurements.

2. Notify the CO of the use of government property. The contractor may use government property for only the specific contract intended, unless otherwise provided for and approved by the CO. The contractor may not modify, cannibalize, or make alterations to government property unless the contract specifically identifies the modifications, alterations, or improvements as work to be performed.

How does the COR determine if government property should be used on the proposed procurement and what government property should be used?

The COR should:

Consider recommendations from other government officials

Review acquisition histories of similar procurements

Review reports on existing property inventory.

Once the determination is made that the use of government property is required, the COR should determine whether the government property for the proposed procurement will be:

Furnished by the government to the contractor for use under the government contract

Purchased by the government for the contractor to use under the government contract

Acquired by the contractor for use under the government contract.

The COR should also identify the date that government-furnished property will be available and reserve the property in the agency inventory system. The COR should specify any special restrictions or conditions applicable to the government property, including:

Whether the property is to be provided "as is"

Security issues and other special handling, if needed

Minimum skills needed to operate the government property.

How does the COR notify the CO of the use of government property, and what property-related issues should the COR consider in his or her notification?

The COR should submit a written document to the CO that lists all relevant factors necessary for justifying the use of government property as an integral part of the procurement. This document should also address issues specific to the type of government property needed, including:

1. Government-furnished property issues These issues may include:

Government liability for performance of GFP

Administrative costs and logistics support costs for GFP

Cost of modifying GFP

Opportunity costs of GFP (i.e., other ways the government might use the property)

Potential impact on the total contract price if GFP is proposed

Reductions in direct costs, indirect costs, and fee with GFP

Economic benefits of standardization through GFP

Estimated residual value of the items

Amount offered by the contractor for the right to retain the items

Effect on future competition and contract pricing.

2. Contractor-acquired property issues These issues may include:

Potential performance problems if contractor-acquired property is not delivered

Ownership of the contractor-acquired property

Use of contractor-acquired property on other contracts

Administrative costs and maintenance costs for contractor-acquired property

Government liability for storage of contractor-acquired property.

The COR needs to inform the CO of the availability of government property before a solicitation is issued. If government property is not available, the CO must have time to consider including a requirement for contractor-acquired property in the solicitation.

What government property issues may arise after a solicitation has been issued?

After the solicitation is issued, the CO may ask the COR to provide assistance when:

A comparison with offers based on contractor-acquired property needs to be made

An offeror has proposed different terms and conditions than those solicited with respect to GFP

The contractor has submitted a postaward request for property not covered by the contract.

When government property is involved, it is imperative that the COR read the pertinent property clause of the contract. The COR must understand the rights and obligations of the government and contractor and be particularly aware of whether any deviations are authorized in the contract. Accurate COR files regarding delivery of property, changes, accountability, and condition of the property are essential in any dispute over GFP.

See Chapter 6, Administration of Government Property, for a discussion of COR responsibilities after contract award.

 
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