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    As stated in question background, the program in question is a small, Post-MS C Navy program just completing LRIP, with final delivery from Prime Contractor scheduled for 30 September. COVID has impacted the Program Office's Operational Testing schedule/timeline (planned for just after acceptance of LRIP articles), and temporary short-term, no-cost storage of the LRIP articles at the contractor facility (immediately following acceptance) has been determined to be available and advantageous for the program. The Program Office is attempting to determine the appropriate methods of: 1) documenting acceptance of LRIP articles, and 2) temporarily transferring custody of LRIP articles back to the contractor for no-cost temporary storage. The Program Office has historically used the DD250 form to document LRIP acceptance and the DD1149 form to document transfer of Government Property custody from one party to another, but is looking to verify the appropriateness of this approach in this circumstance. Due to the program's contracting circumstances, service-wide property management systems (e.g., Wide Area Work Flow, Procurement Integrated Enterprise Environment, etc.) are not applicable, and the Program Office is seeking to "manually" track and perform a similar transaction using paperwork/form.


    Answer

      Payment requests and receiving reports are required to be submitted in electronic form unless one of the exceptions in DFARS 232.7002 apply, so ensure one of the exceptions apply to this program. Part 4 of DFARS Appendix F will then apply and the program office can use the DD Form 250 to document acceptance of the items.

      Once an item is both inspected and accepted via a DD Form 250, it completes the contract terms and no longer has a performance requirement. Once this takes place, there is no longer a requirement for the contractor to maintain the items under their property management system per FAR 52.245-1, and the limited liability provision is also no longer valid, leaving the contractor at full risk of loss for the Government property. Without a contract, it is simply Government property in the possession of the contractor. It is the contract language that allows the Government (Contracting Officer or Property Administrator) to grant relief; with that said, if it is no longer covered by the contract, the CO and PA no longer have the authority to grant relief. 

    FAR 45.602 provides direction for reutilization of Government property that is not required for continued performance of a Government contract. For Navy contracts, NMCARS 5245.602-3(c) says: Prior to authorizing retention of items in storage the contracting officer shall ensure that a retention plan has been developed. Retention plans shall include the justification for storage, a detailed description of the property to be stored, storage costs, location, planned period of storage, and source of funds for storage. The use of "nocosts" [sic] or no direct cost storage agreements is prohibited.

    For future reference, note DD Form 1149s are not allowed for the transfer of Government property from one contract to another. Before acceptance of the items, an 1149 may be used to transfer Government property from one physical location to another but not the transfer of contract accountability.  DFARS PGI 245.103-71 provides guidance on the transfer of Government property.

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