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    I don't specifically have a problem with #3, since under that scenario the AF is planning to accept all current items, transferring the property to the AF, which would make it 'property in the possession of the AF', although I suspect that it is still adding a level of work. Is there something in writing from the Air Force that differentiates between contract property and military property? Considering the current FAR clause at 52.245-1, and the requirement for Industry Leading Practices and ILPs, can we require a contractor to use Govt. owned systems? Further, since this is a cost type contract, the contractor bid with the understanding that they would be responsible for managing the contract property, isn't transferring the ADPE property back to the AF essentially doing what we're paying them to do? If you have any other suggestion of things I should be thinking about with this, I would really appreciate it.


    Answer

    Well, it never ceases to amaze me the new and creative ways that people apply or ignore the requirements of the Federal Acquisition Regulations (FAR) and then create their own unique contractual requirements.
    O.k., in regard to Government property in the possession of contractors the FAR is quite clear in regard to the Government’s and the contractor’s requirements.

    On the Government’s side of the house – FAR Part 45 provides its guidance, i.e., policy on providing Government property (GP) to contractors, managing GP, collection of rental for the use of GP and even the disposal/disposition of GP.

    When GP is provided to contractors FAR SubPart 45.1 requires the Contracting Officer to use/insert into the contract FAR 52.245-1 and FAR 52.245-9, i.e., the GP clause and the Uses and Charges Clause. FAR 52.245-1 provides the contractor the CONTRACTUAL IMPOSED requirements related to the MANAGEMENT of GP. And if a Contracting Officer wants to deviate from these requirements FAR 1.4 describes this process – "This subpart prescribes the policies and procedures for authorizing deviations from the FAR." A definition or clarification of "Deviation" is provided under under FAR 1.401. It states:

    Deviation" means any one or combination of the following:

    (a) The issuance or use of a policy, procedure, solicitation provision (see definition in 2.101)
    (b) The omission of any solicitation provision or contract clause when its prescription requires its use.
    (c) The use of any solicitation provision or contract clause with modified or alternate language that is not authorized by the FAR (see definition of "modification" in 52.101.
    (d) The use of a solicitation provision or contract clause prescribed by the FAR on a "substantially as follows" or "substantially the same as" basis (see definitions in 2.101)
    (e) The authorization of lesser or greater limitations on the use of any solicitation provision, contract clause, policy, or procedure prescribed by the FAR.
    (f) The issuance of policies or procedures that govern the contracting process or otherwise control contracting relationships that are not incorporated into agency acquisition regulations in accordance with 1.301.

    So, it would appear that requiring a Contractor to comply with a separate Air Force Manual – NOT called out in the FAR GP Clause or other FAR Clause would be a violation of the FAR protocol on deviations.

    Ahhh, but it does allow Agencies to SUPPLEMENT these contractual requirements. I did a quick search of the Air force FAR Supplement (AFFARS) in regard to the additional requirements imposed upon the contractor regarding GP. There were no additional AFFARS clauses related to any GP Requirements.

    Now you referenced two other AF requirements: AFMAN 23-110 and AFI 33-112 and their applicability to the contractor. Quite clearly these are requirements APPLIED INTERNALLY TO THE GOVERNMENT, SPECIFICALLY TO THE AIR FORCE – they are NOT intended for application to the contractor – though that is appears to be what is happening, i.e., the Contracting Officer incorporated a requirement for these two AF Requirements into the contract – when in point of fact they have no applicability to the contractor – rather they establish a requirement that the GOVERNMENT (AF) is supposed to be performing. [TECHNICAL NOTE: And if we go one step further on the technical contractual application – if the AF had intended these documents to be contractually imposed upon contractors it would have had to publish them as a proposed rule for public comment (Which I doubt has been done).]

    Now I realize that contractors are often hired to perform support work for the Government – and such may be the case here. But one needs to be EXTREMELY CAREFUL about reading one requirement with the result of obviating another contractual requirement. So let me provide some simple statements of fact:
    1. Contractors are required to have their own Property Management System as required by FAR 52.245-1.
    a. Within that Property Management System is the requirement for the contractor to establish plans and procedures, establish and maintain records of ALL Government property in its possession or control
    b. Have a Property Management System that provides the outcomes as set forth in Paragraph (f),
    c. And comply with all of the other contractual requirements of the clause.

    2. Contractors MAY perform AF duties and responsibilities as support work to the AF as called out in AFMAN 23-110 and AFI 33-112 – but these are in ADDITION to the requirements of FAR 52.245-1 – NOT in replacement of the FAR GP Clausal requirements!

    Last part of this discussion relates to the issue of transferring the equipment back to the AF. As such it would no longer by GP accountable under the contractor’s contract – rather it would now be GP accountable to the AF. Now, regardless of whose possession it is in the AF still has its financial reporting requirements – and that is where AFMAN 23-110 and AFI 33-112 come into play. Even though the contractor has accountability of the assets under its contracts the AF must still have its fiduciary records. So, it appears that the contractor has to establish its OWN records of GP under ITS Property Management System as well as supporting the AF through the creation and maintenance of records under AFMAN 23-110 and AFI 33-112 – two separate and distinct actions that are VERY similar in nature – to comply with a contractual requirement, and to comply with an internal Government accountability/accounting process.
    http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/02.htm#P10_632> ), contract clause (see definition in 2.101 <http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/02.htm#P10_632> ), method, or practice of conducting acquisition actions of any kind at any stage of the acquisition process that is inconsistent with the FAR.http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/52_000.htm#P17_1034> (a) and definition of "alternate" in 2.101 <http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/02.htm#P10_632> (a)).http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/02.htm#P10_632> and 52.101 <http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/52_000.htm#P17_1034> (a)), if such use is inconsistent with the intent, principle, or substance of the prescription or related coverage on the subject matter in the FAR.http://farsite.hill.af.mil/reghtml/regs/far2afmcfars/fardfars/far/01.htm#P1314_31377> (a).

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