Can we authorize the use of the rental vehicles to contractors if we include the GFP clause in the contract?
It is difficult to provide an answer without benefit of seeing the regulation cited by Vehicle Logistics. That regulation's definition of what constitutes a government-owned vehicle (does it specifically include leased vehicles?) would help to address this issue. If the definition of GOV does not include leased vehicles, then Vehicle Logistics' point may be moot. Leased vehicles are considered "government property" for purposes of the clause at FAR 52.245-1, but "government-owned" may not include leased vehicles. There may be an issue related to the terms of the leasing agreement between the vehicle leasing company and the Government that may preclude use of the vehicles by anyone other than Government personnel.
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Please check with your organization's legal counsel for additional input on this matter.