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  • Question

    Can the contractor include preparation costs (such as purging and removing oil) in their quote to demil property?


    Answer

    Contractors may record all his disposal costs to project future expenses. However, the receipt of Government property comes with FAR 52.245-1 along with other contract terms. Excerpts from FAR 52.245-1 follow:
    (b) Property management.
    (1) ... the Contractor shall initiate and maintain the processes..consistent with ...practices and standards....
    (2) The Contractor’s responsibility extends from the initial acquisition and receipt of property, through ... disposition, ....
     
    (j) Contractor inventory disposal.
    (8) (iii) The Contracting Officer may require the Contractor to demilitarize the property prior to shipment or disposal. In such cases, the Contractor may be entitled to an equitable adjustment ....
     
    There are times when the contractor cannot perform the demil action, or when the PLCO may ask the contractor to solicit competitive bids for the demil to be accomplished by DRMO or another appropriate source. It's necessary to coordinate with the CO to determine what's allowable before any disposal direction incurs a direct cost.
     
    Unless the contractor has no other work that requires removal of the oil, existing processes may include a routine waste pickup in their overhead cost. Further, once the demil action is certified, if there are no remaining hazards or identifiers, the PLCO may abandon the residual material, unless it has scrap value.
     
    Please don't hesitate to discuss this matter further.
     
    Also, you and all DoD Contractors are welcome to join the Property Community of Practice (CoP) at https://acc.dau.mil <https://acc.dau.mil> Please follow these links: ACC Practice Center/Special Interest Areas/Government Property. Community members can stay aware of developments and share knowledge that might benefit ALCON.
     
     

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