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    Sir/Ma'am, Can a contractor be a Primary Hand Reciept Holder for or than GFE property for a Unit or Organizational Supply Operations, MTOE/TDA's.


    USARMY ACC supported the following response.
    The answer to your question is simple… No, you cannot have a contractor as a primary hand receipt holder!!  Explaining why is a little more complicated. 
    AR 735-5 defines a “hand receipt” as, “a signed document acknowledging acceptance of and responsibility for the items of property listed thereon that are issued for use and are to be returned.”  As we all know, Army Regulations are for Army employees (i.e. soldiers, civilians).  If a Department of Army civilian loses an item on his/her hand receipt (i.e. DA Form 3161), he/she can be held financially liable for the lost item.  This is NOT the case with contractors performing on an Army contract.  AR 710-2, 2-61 para. (b)(3)(b) specifically states that the “hand receipting and lateral transferring of material, equipment, or supplies to contractors are prohibited.” 
    So, how are contractors made accountable for the Government Property that they are provided in performance of their Army contracts? 
    Contractors are made accountable via the terms and conditions of their contract with Army.  So, for the contractor to be made accountable for the Government Furnished Property (GFP) that your organization is providing, you would need to contact the Contracting Officer for the contract in question and ask he/she to execute a modification to the contract.  That modification will include a listing of the GFP being provided to the contractor.  Please keep in mind that there is a set format for the GFP listing… DFARS PGI 245.103-72.  The modification is the contractual document that “authorizes” the transfer of GFP to the contractor.  When the property is physically shipped/transferred to the contractor, a DD Form 1149 Requisition and Invoice/Shipping Document shall be used to “document” that the transfer occurred.  Once the contractor signs the DD Form 1149, it is critical that it is sent back to the Contracting Officer for incorporation into the official contract file.  Bottom line… the contractor cannot be held accountable for the GFP in its possession until the GFP is transferred to the contractor at contract award or via a modification.  The contract is the legal document that binds the contractor.  Hand receipts are not legally binding on a contractor.  .
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