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  • Question

    Under the circumstances described above, would the Contracting Officer have the authority to approve use of a Receipt and Issue System by the prime contractor? Or, is a Government Property Administrator the only authorized Federal representative having this authority?


    Answer

    When a contractor under a Government contract is “provided” Government property as either Government-furnished property (GFP) or as Contractor-acquired property (CAP) the contractor is required to have a property management system by the relevant embedded FAR contract Government property clause at 52.245-1, ALT I or ALT II.
     
    FAR 45.101 definitions
    Ø  “Provide” means to furnish, as in Government-furnished property, or to acquire, as in contractor-acquired property.
    Ø  “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 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.
    Ø  “Contractor-acquired property” means property acquired, fabricated, or otherwise provided by the contractor for performing a contract and to which the Government has title.
    .
    FAR 52.245-1(f) requires the contractor have a property management system that includes plans, systems and procedures that document “outcomes” critical to successful protection of Government property placed under their stewardship. 
     
    FAR 52.245-1(f)(1)(iii), Records of Government property, outlines Government expectations for the record keeping outcome but provides the contractor an alternative approach.  In the instance noted above, the contractor has asked for approval to use a simpler, less formal system for property record keeping called a receipt and issue system described at 52.245-1(f)(1)(iii)(B), below:. 
     
    (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.
     
    As indicated, the designated approval authority is the assigned Government Property Administrator with no mention of any other possible approving authority which is at issue.
     
    The first step is to determine who or what agency is performing post-award contract administration on this time and material contract.  This is rather easily done by locating that appropriate information in the “AMINISTERED BY” block on the face of the contract.  Whatever office is noted there, is responsible for performing the normal contract administration functions called out in FAR 42.302(a) including property administration (42.302(a)(27)).  Once that’s known, make contact and ask who the appointed and assigned Government Property Administrator is on the subject contract.
     
    But this might not pin down Government property administration responsibilities.  Here are a couple of “issues” you may still confront you:
     
    Ø  The designated administrative office doesn’t have an appointed/assigned Government Property Administrator, per se
    Ø  The designated administrative office called out on the face of the contract is the same as the Procuring Contracting Office and doesn’t have an appointed/assigned Government Property Administrator, per se
     
    The authorities (like authorizing use of a receipt/issue system) and responsibilities for property administration (and plant clearance) must be carried out by an individual that is appointed/assigned as the Government Property Administrator (or as plant clearance officer) as noted at DFARS 201.670 and bearing a Certificate of Appointment as such. 
     
    So (at long last!), if you don’t have a certificate bearing Government Property Administrator, who has the “AUTHORITY” to approve a contractors use of a “receipt and issue system?”
     
    The “authority” falls then to either;
    Ø  the Administrative Contracting Officer (has a Certificate of Appointment as such) with the responsibility for carrying out the normal contract administration functions listed in FAR 42.302(a)(1)-(71) as assigned on the face page of the contract, or;
    Ø  the Procuring Contracting Officer (has a Certificate of Appointment as such) who has retained normal contract administrative functions listed in 42.302(a)(1)-(71) as retained by the buying office on the fact page of the contract
    Ø  No one else!!!
     
    ONE LAST THOUGHT…
    In the absence of a certificate bearing Government Property Administrator, either the Administrative Contracting Officer or the Procuring Contracting Officer has the “AUTHORITY” to perform Property Administrator functions.  BUT…, is this functionally optimal? 
     
    The protection of the Government’s interests under FAR clause 52.245-1 involves the surveillance of a major contractor business system.  Even if DFARS 252.242-7005 Contractor Business Systems and 252.245-7003 Contractor Property Management System Administration clauses are not on the subject contract, there’s no replacement for the functional expertise of an assigned/appointed Government Property Administrator who will perform knowledgeable contract property administration under both FAR clause 52.245-1 and FAR part 45.

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