Defense Federal Acquisition Regulation Supplement (DFARS) Business Systems - Definition and Administration; 245, Contractors Property Management System

(Revised February 24, 2012)

 

 

 252.245-7000 Government-Furnished Mapping, Charting, and Geodesy Property.
 252.245-7001 Tagging, Labeling, and Marking of Government-Furnished Property.
 252.245-7002 Reporting Loss of Government Property.
 252.245-7003 Contractor Property Management System Administration.
 252.245-7004 Reporting, Reutilization, and Disposal.


252.245-7000  Government-Furnished Mapping, Charting, and Geodesy Property.

As prescribed in 245.107(a), use the following clause:

 

GOVERNMENT-FURNISHED MAPPING, CHARTING, AND GEODESY PROPERTY (DEC 1991)

 

      (a)  Definition.  �Mapping, charting, and geodesy (MC&G) property� means geodetic, geomagnetic, gravimetric, aeronautical, topographic, hydrographic, cultural, and toponymic data presented in the form of topographic, planimetric, relief, or thematic maps and graphics; nautical and aeronautical charts and publications; and in simulated, photographic, digital, or computerized formats.

 

      (b)  The Contractor shall not duplicate, copy, or otherwise reproduce MC&G property for purposes other than those necessary for performance of the contract.

 

      (c)  At the completion of performance of the contract, the Contractor, as directed by the Contracting Officer, shall either destroy or return to the Government all Government-furnished MC&G property not consumed in the performance of this contract.

 

(End of clause)

 

 

252.245-7001 Tagging, Labeling, and Marking of Government-Furnished Property.

As prescribed in 245.107(b), use the following clause:

 

TAGGING, LABELING, AND MARKING OF GOVERNMENT-FURNISHED PROPERTY (FEB 2011)

 

      (a)  Definitions.  As used in this clause�

 

      �Government-furnished property� is defined in the clause at FAR 52.245-1, Government Property.

 

      �Serially-managed item� means an item designated by DoD to be uniquely tracked, controlled, or managed in maintenance, repair, and/or supply systems by means of its serial number.

             

      (b)  The Contractor shall tag, label, or mark Government-furnished property items identified in the contract as subject to serialized item management (serially-managed items).

 

      (c)  The Contractor is not required to tag, label, or mark Government-furnished property previously tagged, labeled, or marked.

 

(End of clause)

 

252.245-7002 Reporting Loss of Government Property.

As prescribed in 245.107(c), use the following clause:

 

REPORTING LOSS OF GOVERNMENT PROPERTY (FEB 2011)

 

      (a)  Definitions.  As used in this clause�

 

      �Government property� is defined in the clause at FAR 52.245-1, Government Property.

 

      �Loss of Government property� means unintended, unforeseen, or accidental loss, damage, or destruction of 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.

 

      �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 acceptable accounting principles.

 

      (b)  Reporting loss of Government property.

 

              (1)  The Contractor shall use the Defense Contract Management Agency (DCMA) eTools software application for reporting loss of Government property.  Reporting value shall be at unit acquisition cost.  The eTools �LTDD of Government Property� toolset can be accessed from the DCMA home page External Web Access Management application at http://www.dcma.mil/aboutetools.cfm.

 

              (2)  Unless otherwise provided for in this contract, the requirements of paragraph (b)(1) of this clause do not apply to normal and reasonable inventory adjustments, i.e., losses of low-risk consumable material such as common hardware, as agreed to by the Contractor and the Government Property Administrator.  Such losses are typically a product of normal process variation.  The Contractor shall ensure that its property management system provides adequate management control measures, e.g., statistical process controls, as a means of managing such variation.

 

              (3)  The Contractor shall report losses of Government property outside normal process variation, e.g., losses due to�

 

                    (i)  Theft;

 

                    (ii)  Inadequate storage;

 

                    (iii)  Lack of physical security; or

 

                    (iv)  �Acts of God.�  

 

              (4)  This reporting requirement does not change any liability provisions or other reporting requirements that may exist under this contract.

 

(End of clause)

 

252.245-7003 Contractor Property Management System Administration.

As prescribed in 245.107, insert the following clause:

 

CONTRACTOR PROPERTY MANAGEMENT SYSTEM ADMINISTRATION (FEB 2012)

 

      (a)  Definitions.  As used in this clause�

 

�Acceptable property management system� means a property system that complies with the system criteria in paragraph (c) of this clause.

 

�Property management system� means the Contractor�s system or systems for managing and controlling Government property.

 

�Significant deficiency� means a shortcoming in the system that materially affects the ability of officials of the Department of Defense to rely upon information produced by the system that is needed for management purposes.

 

      (b)  General.  The Contractor shall establish and maintain an acceptable property management system. Failure to maintain an acceptable property management system, as defined in this clause, may result in disapproval of the system by the Contracting Officer and/or withholding of payments.

 

      (c)  System criteria.  The Contractor�s property management system shall be in accordance with paragraph (f) of the contract clause at Federal Acquisition Regulation 52.245-1.

 

      (d)  Significant deficiencies.  (1)  The Contracting Officer will provide an initial determination to the Contractor, in writing, of any significant deficiencies. The initial determination will describe the deficiency in sufficient detail to allow the Contractor to understand the deficiency.

 

              (2)  The Contractor shall respond within 30 days to a written initial determination from the Contracting Officer that identifies significant deficiencies in the Contractor's property management system. If the Contractor disagrees with the initial determination, the Contractor shall state, in writing, its rationale for disagreeing.

 

              (3)  The Contracting Officer will evaluate the Contractor's response and notify the Contractor, in writing, of the Contracting Officer�s final determination concerning�

 

                    (i)  Remaining significant deficiencies;

 

                    (ii)  The adequacy of any proposed or completed corrective action; and

 

                    (iii)  System disapproval, if the Contracting Officer determines that one or more significant deficiencies remain.

 

      (e)  If the Contractor receives the Contracting Officer�s final determination of significant deficiencies, the Contractor shall, within 45 days of receipt of the final determination, either correct the significant deficiencies or submit an acceptable corrective action plan showing milestones and actions to eliminate the significant deficiencies.

 

      (f)  Withholding payments.  If the Contracting Officer makes a final determination to disapprove the Contractor�s property management system, and the contract includes the clause at 252.242-7005, Contractor Business Systems, the Contracting Officer will withhold payments in accordance with that clause.

 

(End of clause)

 

252.245-7004 Reporting, Reutilization, and Disposal.

As prescribed in 245.107(e), use the following clause:

 

REPORTING, REUTILIZATION, AND DISPOSAL (AUG 2011)

 

      (a)  Definitions.  As used in this clause�

 

              (1)  �Demilitarization� means the act of eliminating the functional capabilities and inherent military design features from DoD personal property. Methods and degree range from removal and destruction of critical features to total destruction by cutting, tearing, crushing, mangling, shredding, melting, burning, etc.

 

              (2)  �Export-controlled items� means items subject to the Export Administration Regulations (EAR) (15 CFR parts 730-774) or the International Traffic in Arms Regulations [(ITAR)] (22 CFR parts 120-130). The term includes� 

 

                    (i)  �Defense items,� defined in the Arms Export Control Act, 22 U.S.C. 2778(j)(4)(A), as defense articles, defense services, and related technical data, etc.; and

 

                    (ii)  �Items,� defined in the EAR as �commodities,� �software,� and �technology,� terms that are also defined in the EAR, 15 CFR 772.1.

 

              (3)  �Ineligible transferees� means individuals, entities, or countries� 

 

                    (i)  Excluded from Federal programs by the General Services Administration as identified in the Excluded Parties Listing System (EPLS) (https://www.epls.gov/);

 

                    (ii)  Delinquent on obligations to the U.S. Government under surplus sales contracts;

 

                    (iii)  Designated by the Department of Defense as ineligible, debarred, or suspended from defense contracts; or

 

                    (iv)  Subject to denial, debarment, or other sanctions under export control laws and related laws and regulations, and orders administered by the Department of State, the Department of Commerce, the Department of Homeland Security, or the Department of the Treasury.

 

              (4)  �Scrap� means property that has no value except for its basic material content. For purposes of demilitarization, scrap is defined as recyclable waste and discarded materials derived from items that have been rendered useless beyond repair, rehabilitation, or restoration such that the item�s original identity, utility, form, fit, and function have been destroyed. Items can be classified as scrap if processed by cutting, tearing, crushing, mangling, shredding, or melting. Intact or recognizable components and parts are not �scrap.� 

 

              (5)  �Serviceable or usable property� means property with potential for reutilization or sale �as is� or with minor repairs or alterations.

 

      (b)  Inventory disposal schedules.  Unless disposition instructions are otherwise included in this contract, the Contractor shall complete SF 1428, Inventory Schedule B, within the Plant Clearance Automated Reutilization Screening System (PCARSS). Information on PCARSS can be obtained from the plant clearance officer and at http://www.dcma.mil/ITCSO/CBT/PCARSS/index.cfm.

 

              (1)  The SF 1428 shall contain the following:

 

                    (i)  If known, the applicable Federal Supply Code (FSC) for all items, except items in scrap condition.

 

                    (ii)  If known, the manufacturer name for all aircraft components under Federal Supply Group (FSG) 16 or 17 and FSCs 2620, 2810, 2915, 2925, 2935, 2945, 2995, 4920, 5821, 5826, 5841, 6340, and 6615.

 

                    (iii)  The manufacturer name, make, model number, model year, and serial number for all aircraft under FSCs 1510 and 1520.

 

                    (iv)  Appropriate Federal Condition Codes. See Appendix 2 of DoD 4000.25-2, Military Standard Transaction Reporting and Accounting Procedures manual, edition in effect as of the date of this contract. Information on Federal Condition Codes can be obtained at http://www.DLA.Mil/J-6/DLMSO/Elibrary/Manuals/Milstrap/AP2_Index.asp.

 

              (2)  If the schedules are acceptable, the plant clearance officer shall complete and send the Contractor a DD Form 1637, Notice of Acceptance of Inventory.

 

      (c)  Proceeds from sales of surplus property.  Unless otherwise provided in the contract, the proceeds of any sale, purchase, or retention shall be�

 

              (1)  Forwarded to the Contracting Officer;

 

              (2)  Credited to the Government as part of the settlement agreement;

 

              (3)  Credited to the price or cost of the contract; or

 

              (4)  Applied as otherwise directed by the Contracting Officer.

 

      (d)  Demilitarization, mutilation, and destruction.  If demilitarization, mutilation, or destruction of contractor inventory is required, the Contractor shall demilitarize, mutilate, or destroy contractor inventory, in accordance with the terms and conditions of the contract and consistent with Defense Demilitarization Manual, DoDM 4160.28-M, edition in effect as of the date of this contract. The plant clearance officer may authorize the purchaser to demilitarize, mutilate, or destroy as a condition of sale provided the property is not inherently dangerous to public health and safety.

 

      (e)  Classified Contractor inventory.  The Contractor shall dispose of classified contractor inventory in accordance with applicable security guides and regulations or as directed by the Contracting Officer.

 

      (f)  Inherently dangerous Contractor inventory.  Contractor inventory dangerous to public health or safety shall not be disposed of unless rendered innocuous or until adequate safeguards are provided.

 

      (g)  Contractor inventory located in foreign countries.  Consistent with contract terms and conditions, property disposition shall be in accordance with foreign and U.S. laws and regulations, including laws and regulations involving export controls, host nation requirements, Final Governing Standards, and Government-to-Government agreements. The Contractor's responsibility to comply with all applicable laws and regulations regarding export-controlled items exists independent of, and is not established or limited by, the information provided by this clause.

 

      (h)  Disposal of scrap. 

 

              (1)  Contractor with scrap procedures.

 

                    (i)  The Contractor shall include within its property management procedure, a process for the accountability and management of Government-owned scrap. The process shall, at a minimum, provide for the effective and efficient disposition of scrap, including sales to scrap dealers, so as to minimize costs, maximize sales proceeds, and, contain the necessary internal controls for mitigating the improper release of non-scrap property.

 

                    (ii)  The Contractor may commingle Government and contractor-owned scrap and provide routine disposal of scrap, with plant clearance officer concurrence, when determined to be effective and efficient.

 

              (2)  Scrap warranty.  The plant clearance officer may require the Contractor to secure from scrap buyers a DD Form 1639, Scrap Warranty.

 

      (i)  Sale of surplus Contractor inventory. 

 

              (1)  The Contractor shall conduct sales of contractor inventory (both useable property and scrap) in accordance with the requirements of this contract and plant clearance officer direction.

 

              (2)  Any sales contracts or other documents transferring title shall include the following statement:

 

      ``The Purchaser certifies that the property covered by this contract will be used in (name of country). In the event of resale or export by the Purchaser of any of the property, the Purchaser agrees to obtain the appropriate U.S. and foreign export or re-export license approval.  

 

      (j)  Restrictions on purchase or retention of Contractor inventory. 

 

              (1)  The Contractor may not knowingly sell the inventory to any person or that person's agent, employee, or household member if that person�

 

                    (i)  Is a civilian employee of the DoD or the U.S. Coast Guard;

 

                    (ii)  Is a member of the armed forces of the United States, including the U.S. Coast Guard; or

 

                    (iii)  Has any functional or supervisory responsibilities for or within the DoD�s property disposal/disposition or plant clearance programs or for the disposal of contractor inventory.

 

              (2)  The Contractor may conduct Internet-based sales, to include use of a third party.

 

              (3)  If the Contractor wishes to bid on the sale, the Contractor or its employees shall submit bids to the plant clearance officer prior to soliciting bids from other prospective bidders.

 

              (4)  The Contractor shall solicit a sufficient number of bidders to obtain adequate competition. Informal bid procedures shall be used, unless the plant clearance officer directs otherwise. The Contractor shall include in its invitation for bids, the sales terms and conditions provided by the plant clearance officer.

 

              (5)  The Contractor shall solicit bids at least 15 calendar days before bid opening to allow adequate opportunity to inspect the property and prepare bids.

 

              (6)  For large sales, the Contractor may use summary lists of items offered as bid sheets with detailed descriptions attached.

 

              (7)  In addition to mailing or delivering notice of the proposed sale to prospective bidders, the Contractor may (when the results are expected to justify the additional expense) display a notice of the proposed sale in appropriate public places, e.g., publish a sales notice on the Internet in appropriate trade journals or magazines and local newspapers.

 

              (8)  The plant clearance officer or representative will witness the bid opening. The Contractor shall submit, either electronically or manually, two copies of the bid abstract.

 

              (9)  The following terms and conditions shall be included in sales contracts involving the demilitarization, mutilation, or destruction of property:

 

                    (i)  Demilitarization, mutilation, or destruction on Contractor or subcontractor premises. Item(s) ______ require demilitarization, mutilation, or destruction by the Purchaser. Insert item number(s) and specific demilitarization, mutilation, or destruction requirements for item(s) shown in Defense Demilitarization Manual, DoDM 4160.28-M, edition in effect as of the date of this contract. Demilitarization shall be witnessed and verified by a Government representative using DRMS Form 145 or equivalent.

 

                    (ii)  Demilitarization, mutilation, or destruction off Contractor or subcontractor premises.

 

                           (A)  Item(s) ______ require demilitarization, mutilation, or destruction by the Purchaser. Insert item number(s) and specific demilitarization, mutilation, or destruction requirements for item(s) shown in Defense Demilitarization Manual, DoDM 4160.28-M, edition in effect as of the date of this contract. Demilitarization shall be witnessed and verified by a Government representative using DRMS Form 145 or equivalent.

 

                           (B)  Property requiring demilitarization shall not be removed, and title shall not pass to the Purchaser, until demilitarization has been accomplished and verified by a Government representative. Demilitarization will be accomplished as specified in the sales contract. Demilitarization shall be witnessed and verified by a Government representative using DRMS Form 145 or equivalent.

 

                           (C)  The Purchaser agrees to assume all costs incident to the demilitarization and to restore the working area to its present condition after removing the demilitarized property.

 

                    (iii)  Failure to demilitarize. If the Purchaser fails to demilitarize, mutilate, or destroy the property as specified in the contract, the Contractor may, upon giving 10 days written notice from date of mailing to the Purchaser�

 

                           (A)  Repossess, demilitarize, and return the property to the Purchaser, in which case the Purchaser hereby agrees to pay to the Contractor, prior to the return of the property, all costs incurred by the Contractor in repossessing, demilitarizing, and returning the property;

 

                           (B)  Repossess, demilitarize, and resell the property, and charge the defaulting Purchaser with all costs incurred by the Contractor. The Contractor shall deduct these costs from the purchase price and refund the balance of the purchase price, if any, to the Purchaser. In the event the costs exceed the purchase price, the defaulting Purchaser hereby agrees to pay these costs to the Contractor; or

 

                           (C)  Repossess and resell the property under similar terms and conditions. In the event this option is exercised, the Contractor shall charge the defaulting Purchaser with all costs incurred by the Contractor. The Contractor shall deduct these costs from the original purchase price and refund the balance of the purchase price, if any, to the defaulting Purchaser. Should the excess costs to the Contractor exceed the purchase price, the defaulting Purchaser hereby agrees to pay these costs to the Contractor.

 

(End of clause)