![](media/image1.wmf){width="0.8243055555555555in"
height="0.6888888888888889in"} Procurement Notice

National Aeronautics and

Space Administration

Washington, DC 20546 **PN 97-64**

> **August 9, 2001**

**INVESTIGATIONS OF SUSPECTED FORCED OR INDENTURED CHILD LABOR AND
PROPERTY REPORTING REQUIREMENTS**

***PURPOSE:***

***ITEM I -*** To specify NASA's procedure for referring investigations
of those suspected of using forced or indentured child labor under FAR
Subpart 22.15.

***ITEM II -*** To comply with existing Federal accounting standards and
OMB rules on Form and Content of agency financial statements and make
other changes to NASA's property reporting requirements.

***BACKGROUND:***

***ITEM I -*** The FAR provides that agencies should specify whether
investigations under FAR 22.1503(e) should be referred to the Inspector
General, the Attorney General, or the Secretary of the Treasury. This PN
provides that all such investigations shall be referred to NASA's
Inspector General.

***ITEM II -*** The OMB Bulletin on Form and Content of Agency Financial
Statements prescribes financial accounting and reporting requirements
for Federal agencies. Included are accounting standards which apply to
property, plant and equipment. PN 97-55 amended the NFS to comply with
these requirements. Specific changes included in PN 97-55 were:
additional instructions on how to adjust previously reported values; a
new definition of Agency Peculiar Property to exclude completed end
items destined for permanent operation in space; and a new definition of
Work in Process to include completed end items destined for permanent
operation in space which otherwise meet the definition of Agency
Peculiar Property. This PN makes further revisions to Subpart 1845.71 to
clarify 1018 reporting requirements and responsible organizations. The
Financial Reporting of NASA Property in the Custody of Contractors
clause, 1852.245-73, has been amended to reduce the number of copies of
the 1018 submitted and address use of the NASA Form (NF) 1018 Electronic
Submission System (NESS) (see also PIC 01-18).

***REGULATION:*** Changes are made in Parts 1822, 1845, and 1852 as set
forth in the enclosed replacement pages.

***REPLACEMENT PAGES:*** You may use the enclosed pages to replace Part
1822, 45:13, 45:14, 45:15, 45:16, 45:17, 45:18, 52:81, 52:82, 52-97 and
52-98 of the NFS.

***REGULATORY COMPLIANCE:*** This PN was published as a final rule in
the Federal Register (66 FR 41804 - 41806, August 9, 2001).

***EFFECTIVE DATE:*** This PN is effective as dated, and shall remain in
effect until canceled or superseded.

***HEADQUARTERS CONTACTS:*** Paul Brundage (Indentured Child Labor),
Code HK, (202) 358-0481, email: pbrundage@hq.nasa.gov; Lou Becker
(Property Reporting), Code HK, (202) 358-4593, email:
lbecker@hq.nasa.gov.

R. Scott Thompson

Director, Contract Management Division

Enclosures

**PART 1822**

**APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS**

**TABLE OF CONTENTS**

1822.000-70 Scope of part.

**SUBPART 1822.1 BASIC LABOR POLICIES**

1822.101 Labor relations.

1822.101-1 General.

1822.101-3 Reporting labor disputes.

1822.101-4 Removal of items from contractors\' facilities affected
by work

stoppages.

1822.101-70 Admission of labor representatives to contract sites.

1822.103 Overtime.

1822.103-4 Approvals.

1822.103-5 Contract clauses.

**SUBPART 1822.3 CONTRACT WORK HOURS AND SAFETY STANDARDS ACT**

1822.302 Liquidated damages and overtime pay.

**SUBPART 1822.4 LABOR STANDARDS FOR CONTRACTS INVOLVING CONSTRUCTION**

1822.400-70 Contacts with the Department of Labor.

1822.404-3 Procedures for requesting wage determinations.

1822.406-8 Investigations.

1822.406-9 Withholding from or suspension of contract payments.

1822.406-13 Semiannual enforcement reports.

**SUBPART 1822.6 WALSH-HEALEY PUBLIC** **CONTRACTS ACT**

1822.604 Exemptions.

1822.604-2 Regulatory exemptions.

**SUBPART 1822.8 EQUAL EMPLOYMENT** **OPPORTUNITY**

1822.804 Affirmative action programs.

1822.804-2 Construction.

1822.807 Exemptions.

1822.810 Solicitation provisions and contract clauses.

**SUBPART 1822.10 SERVICE CONTRACT ACT** **OF 1965**

1822.1001 Definitions.

1822.1008 Procedures for preparing and submitting Notice (SF 98/98a).

1822.1008-270 Additional information for the preparation of SF 98/98a.

1822.1008-7 Required time of submission of Notice.

**SUBPART 1822.13 DISABLED VETERANS AND** **VETERANS OF THE VIETNAM
ERA**

1822.1303 Waivers.

1822.1306 Complaint procedures.

**SUBPART 1822.14 EMPLOYMENT OF WORKERS WITH DISABILITIES**

1822.1403 Waivers.

1822.1406 Complaint procedures.

# SUBPART 1822.15 PROHIBITION OF ACQUISITION OF PRODUCTS

**PRODUCED BY FORCED OR INDENTURED CHILD**

**LABOR**

1822.1503 Procedures for acquiring end products on the List of Products

Requiring Contractor Certification as to Forced or Indentured

Child Labor.

**PART 1822**

**APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS**

**1822.000-70 Scope of part.**

\(a\) Contracting officers shall consult with the installation labor
relations advisor or designee when taking any of the actions prescribed
or authorized in FAR Part 22 or NFS Part 1822.

\(b\) Proposed actions having a substantial impact on the activities of
NASA or other Government agencies shall be approved by the Headquarters
Contractor Industrial Relations Office (Code JLR).

**Subpart** **1822.1\--Basic Labor Policies**

**1822.101 Labor** **relations.**

**1822.101-1 General.**

\(d\) When a strike that may have an adverse effect on NASA programs is
imminent or in progress at a prime contractor\'s or subcontractor\'s
plant, contracting officers shall:

**(i)** Advise both the prime contractor and the head of the union local
in writing of the expected impact of the strike on NASA programs and of
the actions NASA is considering to protect the Government\'s interest
and prevent delay in the accomplishment of NASA\'s mission. If the
strike is in a subcontractor\'s plant, the subcontractor may be
approached only through the prime contractor;

**(ii)**  Explore the possibility of locating other sources for the
supplies or services to have been provided by the strike-threatened
plant; and

**(iii)**  Consider taking the actions described in FAR 22.101-4.

\(e\) Programs or requirements that result in contracts in excess of the
simplified acquisition threshold shall require contractors to notify
NASA of actual or potential labor disputes that are delaying or threaten
to delay timely contract performance.

**1822.101-3**  **Reporting** **labor** **disputes.**

Reports of potential or actual labor disputes affecting NASA
acquisitions, operations, or services shall be submitted to the
Headquarters Contractor Industrial Relations Office (Code JLR). These
reports shall be made as early as possible and shall include immediately
available information. Supplemental reports shall be made to provide
appropriate additional information. Reports shall describe at a minimum:

**(1)** The nature of the potential or actual dispute, including whether
a strike, lockout, slow-down, shut-down, or picketing is involved and
the degree of emergency presented;

**(2)** The character, quantity, and importance of the supplies,
operations, or services involved, including scheduled performance and
delivery dates and their relationship to the total acquisition program;

**(3)** The identity and location of the parties to the dispute and
their representatives, including the approximate number of employees
involved;

**(4)** The need for and availability of alternative resources to
furnish the items involved within the time required;

**(5)** Any critical items that should be removed from the plant or work
site or should continue to be processed there with the consent of the
parties to the dispute; and

**(6)** Recommended action to be taken by NASA.

**1822.101-4** **Removal** **of** **items** **from** **contractors\'**
**facilities** **affected** **by** **work** **stoppages.**

\(a\) (3) The contracting officer shall obtain approval from Code JLR
for any contemplated action.

**1822.101-70 Admission of labor representatives to contract sites.**

NASA activities may not prevent the access of labor union
representatives to contract sites for the conduct of union business if
their activities are compatible with safety and security regulations and
performance of the contract work involved.

**1822.103 Overtime.**

**1822.103-4 Approvals.**

\(a\) The contracting officer is authorized to approve overtime premiums
at Government expense. If two or more contracting offices have current
contracts at a single facility and approval of overtime by one will
affect the performance or cost of contracts of another, the approving
official shall obtain the concurrence of other appropriate approving
officials and seek agreement as to the contracts under which premiums
will be approved. In the absence of evidence to the contrary, a
contracting officer may rely on the contractor\'s statement that
approval will not affect performance or payments under any contract of
another contracting office.

**1822.103-5 Contract clauses.**

\(a\) See 1822.101-1(e).

**Subpart** **1822.3\--Contract Work Hours and Safety Standards Act**

**1822.302 Liquidated damages and** **overtime pay.**

\(c\) The Director of the Headquarters Contractor Industrial Relations
Office (Code JLR) is the agency head designee.

\(d\) Disposal of funds withheld or collected for liquidated damages
shall be in accordance with direction of the Director of Code JLR.

**Subpart** **1822.4\--Labor Standards for Contracts Involving
Construction**

**1822.400-70 Contacts with the Department of Labor.**

All contacts with the Department of Labor required by FAR Subpart 22.4,
except for wage determinations, shall be conducted through the
Headquarters Contractor Industrial Relations Office (Code JLR).
Contracting officers shall submit all pertinent information to Code JLR
in support of Code JLR for contacts. For wage determinations,
contracting officers shall submit all requests directly to Goddard Space
Flight Center, Contractor Industrial Relations Office - GSFC, Code 201,
Greenbelt, Maryland 20771 (GSFC).

**1822.404-3 Procedures for requesting** **wage determinations.**

Contracting officers shall submit requests for project wage
determinations to GSFC at least 55 days (70 days if possible) before
issuing the solicitation.

**1822.406-8 Investigations.**

\(a\) The contracting officer is responsible for conducting
investigations of labor violations relative to contracts under their
cognizance.

\(d\) Reports of violations shall be sent to Code JLR.

**1822.406-9 Withholding from or suspension of contract payments.**

\(c\) (4) Code JLR shall determine the disposal of funds.

**1822.406-13 Semiannual enforcement** **reports.**

Procurement officers shall submit semiannual enforcement data within 20
days after the end of the specified reporting periods to the
Headquarters Office of Procurement (Code HK). Negative statements are
required.

**Subpart 1822.6\--Walsh-Healey Public Contracts Act**

**1822.604 Exemptions.**

**1822.604-2 Regulatory exemptions.**

\(b\) Requests for exemptions shall be submitted in writing through the
contracting officer to the Headquarters Contractor Industrial Relations
Office (Code JLR).

**Subpart 1822.8\--Equal Employment Opportunity**

**1822.804 Affirmative** **action** **programs.**

**1822.804-2 Construction.**

\(b\) The Headquarters Office of Procurement (Code HK) will furnish each
procurement officer the listing.

**1822.807 Exemptions.**

Requests for exemption pursuant to FAR 22.807(a)(1), (a)(2), or (b)(5)
shall be sent to the Headquarters Office of Procurement (Code HS).

**1822.810 Solicitation provisions and contract clauses.**

\(e\) If an offeror completes a negative representation under FAR
52.222-22, the contracting officer shall obtain the information required
by FAR 52.222-26(b)(7) within 30 days of contract award. This
information shall be held in confidence as privileged information in
accordance with 32 CFR 286.6(b)(4).

**Subpart** **1822.10\--Service Contract Act of 1965**

**1822.1001 Definitions.**

**\"Agency labor advisor\"** is the Director of the Headquarters
Contractor Industrial Relations Office (Code JLR). All contacts with
other agencies required by FAR Subpart 22.10 shall be conducted through
Code JLR. Contracting officers shall submit all pertinent information to
Code JLR in support of the required contacts.

**1822.1008 Procedures for preparing and** **submitting Notice (SF
98/98a).**

**1822.1008-270 Additional information for the preparation of SF
98/98a.**

The information listed below by item number shall be furnished, in
addition to that required by the SF 98/98a:

\(a\) **Item 6***.* Insert on the far left side of the block the code
identifying the type of proposed action:

+-----+----------------------------------------------------------------+
| #   | ## Proposed Action                                             |
|  Co |                                                                |
| de  |                                                                |
+-----+----------------------------------------------------------------+
| **  | New contract (use [only]{.underline} when services are not     |
| I** | presently being performed).                                    |
+-----+----------------------------------------------------------------+
| **I | Recompetition of services.                                     |
| I** |                                                                |
+-----+----------------------------------------------------------------+
| *   | Contract modifications affecting the scope of the work.        |
| *II |                                                                |
| I** |                                                                |
+-----+----------------------------------------------------------------+
| **I | Extension of contract performance through exercise of an       |
| V** | option or otherwise.                                           |
+-----+----------------------------------------------------------------+
| **  | Other. When a multiple year contract (funding is not subject   |
| V** | to annual appropriation) is to be entered into, specify        |
|     | \"multiple year R&D funded\" on the SF 98.                     |
+-----+----------------------------------------------------------------+

\(b\)  **Item 8.**

\(1\) If the proposed contract will be awarded under Section 8(a) of the
Small Business Act, insert both the Small Business Administration and
the name of the subcontractor.

\(2\) If no wage determination is available for the particular contract,
insert \"None\" in Item 8.b.

\(c\)  **Item 10***.*  Add the solicitation number.

\(d\)  **Item 12.**

\(1\) When entering into a new service contract, list all classes of
work expected to be performed under the contract under this item,
regardless of whether the class of employees is considered professional,
executive, administrative, or hourly. However, if submission of the SF
98/98a is in connection with any action other than a new contract (Code
I in paragraph (a) of this subsection), list only the classes of work
that the incumbent indicates are \"nonexempt.\"

\(2\) When classifications include both categories of employees covered
by a collective bargaining agreement and those not represented by a
union, mark the classifications that are unionized with an asterisk.

\(3\) If the classification of work is not known, use the most
descriptive job title available for the work to be performed under the
contract.

\(e\) **Item 13***.* If the number of employees is not known, the
estimated hours required to perform the tasks should be indicated so
that staffing estimates can be determined and listed.

\(f\) **Item 14.** Include in this item the wage rates that would be
paid if the employees were subject to 5 U.S.C. 5332 (GS grades).

**1822.1008-7 Required time of submission of notice.**

\(a\) Contracting officers shall submit the notices to Goddard Space
Flight Center, Contract Industrial Relations Office - GSFC, Code 201,
Greenbelt, Maryland 20771 (GSFC) at least 70 days before initiating the
associated contract actions.

\(b\) When the circumstances in FAR 22.1008-7(b) apply, contracting
officers shall submit the required notices to GSFC at least 40 days
before initiating the associated contract actions.

\(c\) Contracting officers shall contact GSFC before initiating any
action when the circumstances in FAR 22.1008-7(c) and (d) apply.

**Subpart** **1822.13\--Disabled Veterans and Veterans of the Vietnam
ERA**

**1822.1303 Waivers.**

\(c\) Requests for waivers shall be submitted to the Associate
Administrator for Equal Opportunity Programs (Code E).

**1822.1306**  **Complaint** **procedures.**

Contracting officers shall submit all complaints to the Associate
Administrator for Equal Opportunity Programs (Code E).

**Subpart** **1822.14\--Employment of Workers with Disabilities**

**1822.1403 Waivers.**

\(c\) Requests for waivers shall be submitted to the Associate
Administrator for Equal Opportunity Programs (Code E).

**1822.1406**  **Complaint** **procedures**

Contracting officers shall submit all complaints to the Associate
Administrator for Equal Opportunity Programs (Code E).

**Subpart 1822.15\--Prohibition of Acquisition of Products Produced by
Forced or**

## Indentured Child Labor

**1822.1503 Procedures for acquiring end products on the List of
Products Requiring Contractor Certification as to Forced or Indentured
Child Labor.**

\(e\) All investigations under FAR Subpart 22.15 shall be referred to
NASA's Office of Inspector General.

**1845.615 Accounting for contractor inventory.**

A copy of Standard Form 1424, Inventory Disposal Report, shall be
provided to the center industrial property officer or the PDO.

**Subpart 1845.70\--Reserved**

**Subpart 1845.71\--Forms Preparation**

**1845.7101 Instructions for preparing NASA Form 1018.**

NASA must account for and report assets in accordance with 31 U.S.C.
3512 and 31 U.S.C. 3515, Federal Accounting Standards, and Office of
Management and Budget (OMB) instructions. Since contractors maintain
NASA's official records for its assets in their possession, NASA must
obtain annual data from those records to meet these requirements.
Changes in Federal Accounting Standards and OMB reporting requirements
may occur from year to year, requiring contractor submission of
supplemental information with the NASA Form (NF) 1018. Contractors shall
retain documentation that supports data reported on NF 1018 in
accordance with FAR subpart 4.7, Contractor Records Retention.
Classifications of property, related costs to be reported, and other
reporting requirements are discussed in this subpart. NASA Form 1018
(see 1853.3) provides critical information for NASA financial statements
and property management. Accuracy and timeliness of the report are very
important. If errors are discovered on NF 1018 after submission, the
contractor shall contact the cognizant NASA Center Industrial Property
Officer (IPO) to discuss corrective action. IPO's shall work with NASA
Center finance personnel to determine appropriate corrective action and
provide guidance to contractors.

**1845.7101-1 Property classification.**

> (a*) General.* Contractors shall report costs in the classifications
> on NF 1018, as described
>
> in this section.

\(b\) *Land.* Includes costs of land and improvements to land.
Contractors shall report land

with a unit acquisition cost of \$100,000 or more.

\(c\) *Buildings*. Includes costs of buildings, improvements to
buildings, and fixed equipment required for the operation of a building
which is permanently attached to and a part of the building and cannot
be removed without cutting into the walls, ceilings, or floors.
Contractors shall report buildings with a unit acquisition cost of
\$100,000 or more. Examples of fixed equipment required for functioning
of a building include plumbing, heating and lighting equipment,
elevators, central air conditioning systems, and built-in safes and
vaults.

\(d\) *Other Structures and Facilities*. Includes costs of acquisitions
and improvements of real property (i.e. structures and facilities other
than buildings); for example, airfield pavements, harbor and port
facilities, power production facilities and distribution systems,
reclamation and irrigation facilities, flood control and navigation
aids, utility systems (heating, sewage, water and electrical) when they
serve several buildings or structures, communication systems, traffic
aids, roads and bridges, railroads, monuments and memorials, and
nonstructural improvements such as sidewalks, parking areas, and fences.
Contractors shall report other structures and facilities with a unit
acquisition cost of \$100,000 or more and a useful life of two years or
more.

\(e\) *Leasehold improvements.* Includes NASA-funded costs of
improvements to leased

buildings, structures, and facilities, as well as easements and
right-of-way, where NASA is the

lessee or the cost is charged to a NASA contract. Contractors shall
report leasehold

improvements with a unit acquisition cost of \$100,000 or more and a
useful life of two years or

more.

\(f\) *Construction in Progress*. Includes costs of work in process for
the construction of

Buildings, Other Structures and Facilities, and Leasehold Improvements
to which NASA has

title, regardless of value.

\(g\) *Equipment.* Includes costs of commercially available personal
property capable of stand-

alone use in manufacturing supplies, performing services, or any general
or administrative

purpose (for example, machine tools, furniture, vehicles, computers,
software, test equipment,

including their accessory or auxiliary items). Contractors shall
separately report:

\(1\) the amount for all items with a unit acquisition cost of \$100,000
or more and a useful

life of two years or more; and

\(2\) All other items.

\(h\) *Special Tooling.* Includes costs of equipment and manufacturing
aids (and their components and replacements) of such a specialized
nature that, without substantial modification or alteration, their use
is limited to development or production of particular supplies or parts,
or performance of particular services. Examples include jigs, dies,
fixtures, molds, patterns, taps and gauges. Contractors shall separately
report:

\(1\) the amount for all items with a unit acquisition cost of \$100,000
or more and a useful life of two years or more; and

\(2\) All other items.

\(i\) *Special Test Equipment.* Includes costs of equipment used to
accomplish special purpose

> testing in performing a contract, and items or assemblies of
> equipment. Contractors shall
>
> separately report:
>
> \(1\) the amount for all items with a unit acquisition cost of
> \$100,000 or more and a useful life of two years or more; and
>
> \(2\) All other items.

\(j\) *Material.* Includes costs of NASA-owned property held in
inventory that may become a part of an end item or be expended in
performing a contract. Examples include raw and processed material,
parts, assemblies, small tools and supplies. Material that is part of
work-in-process is not included. Contractors shall report the amount for
all Materials in inventory, regardless of unit acquisition cost.

\(k\) *Agency-Peculiar Property*. Includes costs of completed items,
systems and subsystems, spare parts and components unique to NASA
aeronautical and space programs. Examples include research aircraft,
reusable space vehicles, ground support equipment, prototypes, and
mock-ups. The amount of property, title to which vests in NASA as a
result of progress payments to fixed price subcontractors, shall be
included to reflect the pro rata cost of undelivered agency-peculiar
property. Completed end items which otherwise meet the definition of
Agency-Peculiar Property, but are destined for permanent operation in
space, such as satellites and space probes, shall be reported as
Contract Work in Process. Contractors shall separately report:

> \(1\) the amount for all items with a unit acquisition cost of
> \$100,000 or more and a useful life of two years or more; and

\(2\) All other items.

\(l\) *Contract Work-in-Process.* Includes costs of all work-in-process
regardless of value; excludes costs of completed items reported in other
categories. Includes completed end items of

property which otherwise meet the definition of Agency-Peculiar
Property, but are destined for

permanent operation in space, such as satellites and space probes.

**1845.7101-2 Transfers of property**.

A transfer is a change in accountability between and among prime
contracts, NASA Centers, and other Government agencies (e.g., between
contracts of the same NASA Center, contracts of different NASA Centers,
a contract of one NASA Center to another, a NASA Center to a contract of
another NASA Center, and a contract to another Government agency or its
contract). To enable NASA to properly control and account for transfers,
they shall be adequately documented. Therefore, procurement, property,
and financial organizations at NASA Centers must effect all transfers of
accountability, although physical shipment and receipt of property may
be made directly by contractors. The procedures described in this
section shall be followed to provide an administrative and audit trail,
even if property is physically shipped directly from one contractor to
another. Property shipped between September 1 and September 30,
inclusively, shall be accounted for and reported by the shipping
contractor, regardless of the method of shipment, unless written
evidence of receipt at destination has been received. Repairables
provided under fixed price repair contracts that include the clause at
1852.245-72, Liability for Government Property Furnished for Repair or
Other Services, remain accountable to the cognizant NASA Center and are
not reportable on NF 1018; repairables provided under a
cost-reimbursement contract, however, are accountable to the contractor
and reportable on NF 1018. All materials provided to conduct repairs are
reportable, regardless of contract type.

\(a\) *Approval and Notification.* The contractor must obtain approval
of the contracting officer

or designee for transfers of property before shipment. Each shipping
document must contain contract numbers, shipping references, property
classifications in which the items are recorded (including Federal
Supply Classification group (FSC) codes for equipment), unit acquisition
costs (as defined in 1845.7101-3, Unit Acquisition Cost), original
acquisition dates for items with a unit acquisition cost of \$100,000 or
more and a useful life of two years or more, and any other appropriate
identifying or descriptive data. Where the DD Form 250, Material
Inspection and Receiving Report, is used, the FSC code will be part of
the national stock number (NSN) entered in Block 16 or, if the NSN is
not provided, the FSC alone shall be shown in Block 16. The original
acquisition date shall be shown in Block 23, by item. Other formats,
such as the DD Form 1149, Requisition and Invoice/Shipping Document,
should be clearly annotated with the required information. Unit
acquisition costs shall be obtained from records maintained pursuant to
FAR Part 45 and this Part 1845, or, for uncompleted items where property
records have not yet been established, from such other record systems as
are appropriate such as manufacturing or engineering records used for
work control and billing purposes. Shipping contractors shall furnish a
copy of the shipping document to the cognizant property administrator.
Shipping and receiving contractors shall promptly notify the financial
management office of the NASA Center responsible for their respective
contracts when accountability for NASA property is transferred to, or
received from, other contracts, contractors, NASA Centers, or Government
agencies. Copies of shipping or receiving documents will suffice as
notification in most instances.

\(b\) *Reclassification.* If property is transferred to another contract
or contractor, the receiving

contractor shall record the property in the same property classification
and amount appearing on the shipping document. For example, when a
contractor receives an item from another contractor that is identified
on the shipping document as equipment, but that the recipient intends to
incorporate into special test equipment, the recipient shall first
record the item in the equipment account and subsequently reclassify it
as special test equipment. Reclassification of equipment, special
tooling, special test equipment, or agency-peculiar property requires
prior approval of the contracting officer or a designee.

\(c\) *Incomplete documentation.* If contractors receive transfer
documents having insufficient detail to properly record the transfer
(e.g., omission of property classification, FSC, unit acquisition cost,
acquisition date, etc.) they shall request the omitted data directly
from the shipping contractor or through the property administrator as
provided in FAR 45.505-2. The contracting officer shall assist the
Government Property Administrator and the receiving contractor to obtain
all required information for the receiving contractor to establish
adequate property records.

**1845.7101-3 Unit acquisition cost.**

\(a\) The unit acquisition cost shall include all costs incurred to
bring the property to a form and

location suitable for its intended use. The following is representative
of the types of costs that shall be included, when applicable:

\(1\) Amounts paid to vendors or other contractors.

\(2\) Transportation charges to the point of initial use.

\(3\) Handling and storage charges.

\(4\) Labor and other direct or indirect production costs (for assets
produced or constructed).

\(5\) Engineering, architectural, and other outside services for
designs, plans, specifications, and surveys.

\(6\) Acquisition and preparation costs of buildings and other
facilities.

\(7\) An appropriate share of the cost of the equipment and facilities
used in construction work.

\(8\) Fixed equipment and related installation costs required for
activities in a building or facility.

\(9\) Direct costs of inspection, supervision, and administration of
construction contracts and construction work.

\(10\) Legal and recording fees and damage claims.

\(11\) Fair values of facilities and equipment donated to the
Government.

\(b\) Acquisition cost shall include, where appropriate, for contractor
acquired Special Test Equipment, Special Tooling, Agency-Peculiar
Property and Contract Work-In-Process, related fees, or a pro rata
portion of fees, paid by NASA to the contractor. Situations where
inclusion of fees in the acquisition cost would be appropriate are those
in which the contractor designs, develops, fabricates or purchases
property for NASA and part of the fees paid to the contractor by NASA
are related to that effort.

\(c\) The use of weighted average methodologies is acceptable for
valuation of Material.

\(d\) Contractors shall report unit acquisition costs using records that
are part of the prescribed

property or financial control system as provided in this section.
Fabrication costs shall be based

on approved systems or procedures and include all direct and indirect
costs of fabrication.

\(e\) Only modifications that improve an item's capacity or extend its
useful life two years or more and that cost \$100,000 or more shall be
reported on the NF 1018 on the \$100,000 & Over line. The costs of any
other modifications, excluding routine maintenance, will be reported on
the Under \$100,000 line. If an item's original unit acquisition cost is
less than \$100,000, but a single subsequent modification costs
\$100,000 or more, that modification only will be reported as an item
\$100,000 or more on subsequent NF 1018s. The original acquisition cost
of the item will continue to be included in the under \$100,000 total.
The quantity for the modified item will remain "1" and be reported with
the original acquisition cost of the item. If an item's acquisition cost
is reduced by removal of components so that its remaining acquisition
cost is under \$100,000, it shall be reported as under \$100,000.

\(f\) The computation of work in process shall include all direct and
indirect costs of fabrication, including associated systems, subsystems,
and spare parts and components furnished or acquired and charged to work
in process pending incorporation into a finished item. These types of
items make up what is sometimes called production inventory and include
programmed extra units to cover replacement during the fabrication
process (production spares). Also included are deliverable items on
which the contractor or a subcontractor has begun work, and materials
issued from inventory. Work in Process shall include the unit
acquisition cost of completed end items of property which otherwise meet
the definition of Agency-Peculiar Property, but which are destined for
permanent operation in space, such as satellites and space probes.

**1845.7101-4 Types of deletions from contractor property records.**

Contractors shall report the types of deletions from contract property
records as described in this

section.

\(a\) *Lost, Damaged or Destroyed.* Deletion amounts that result from
relief from responsibility under FAR 45.503 granted during the reporting
period.

\(b\) *Transferred in Place*. Deletion amounts that result from transfer
of property to a follow-on prime contract or other prime contract with
the same contractor.

\(c\) *Transferred to NASA Center Accountability.* Deletion amounts that
result from transfer of accountability to the NASA Center responsible
for the contract, whether or not items are physically moved.

\(d\) *Transferred to Another NASA Center.* Deletion amounts that result
from transfer of accountability to a NASA Center other than the one
responsible for the contract, whether or not items are physically moved.

\(e\) *Transferred to Another Government Agency.* Deletion amounts that
result from transfer of property to another Government agency.

\(f\) *Purchased at Cost/Returned for Credit.* Deletion amounts that
result from contractor purchase or retention of contractor acquired
property as provided in FAR 45.605-1, or from contractor returns to
suppliers under FAR 45.605-2.

\(g\) *Disposed of Through Plant Clearance Process.* Deletions other
than transfers within the Federal Government, e.g., donations to
eligible recipients, sold at less than cost, or abandoned/directed
destruction.

\(h\) *Other*. Types of deletion other than those reported in paragraph
(a) through (g) of this section such as those resulting from
reclassifications (e.g. from equipment to agency-peculiar property).

**1845.7101-5 Contractor\'s privileged financial and business
information.**

If a transfer of property between contractors involves disclosing costs
of a proprietary nature, the contractor shall furnish unit acquisition
costs only on copies of shipping documents sent to the shipping and
receiving NASA Centers.

**1845.7102 Instructions for preparing DD Form 1419.**

\(a\) The contractor shall enter the essential information covering
Sections I and II before submission of DD Form 1419, DOD Industrial
Plant Equipment Requisition, to the Industrial Property Officer (IPO).
The IPO shall review each submission for completeness and authenticity.
Incomplete or invalid requests shall be returned for correction.

\(b\) When a suitable item is allocated in Section IV, inspection of the
equipment is recommended. Notification of acceptance or rejection of the
item offered must reach NASA within 30 days after allocation. A copy of
the DD Form 1419, or equivalent format, will serve as the clearance
document to inspect the equipment at the storage site. Note acceptance
or rejection of the item, without inspection or after inspection in
Section VI. If the item is acceptable, execute Section VII. Cite the
NASA appropriation symbol where applicable in Section VII.

\(c\) The IPO shall assign a requisition number to each DD Form 1419, or
equivalent format request.

\(d\) Next will be a four-digit entry comprised of the last digit of the
current calendar year and the Julian date of the year. For example,
April 15, 1997, would be written as 7095 (April 15 being the 95th day of
the year). The last entry will be a four-digit number from 0001 to 9999
to sequentially number requisition forms prepared on the same date. For
example, the ninth requisition prepared on April 15, 1997, would be
7095-0009, preceded by the FEDSTRIP/MILSTRIP Activity Address Code. When
submitting subsequent DD Forms 1419, or equivalent format, related to
the item requested, the IPO shall use the same requisition number and
add the alpha code to the end of the requisition number to indicate a
second or third action on the basic request. Alpha \"A\" would indicate
a second request, \"B\" a third, etc. In this manner, all actions,
correspondence, etc., relative to a given request can be identified at
all levels of processing by the use of the requisition number.

\(e\) Detailed directions for completing the DD Form 1419 follow. The
contractor may elect to provide the required data in an equivalent
format, which complies with these directions.

**Section I**

**Item Description.** To ensure adequate screening, the item description
must be complete. For single-purpose equipment or general-purpose
equipment with special features, requests must contain detailed
descriptive data as to size and capacities, setting forth special
operating features or particular operations required to be performed by
the item.

**Block 1**. Not applicable.

**Block 2.** Enter the manufacturer\'s name and Federal Supply Code for
manufacturer (Cataloging Handbook H4-1) of the item requested.

**Block 3**. Enter the manufacturer\'s model, style, or catalog number
assigned to the equipment being requisitioned. Always use the model
number, if available. The style number is the next preference. Enter
\"None\" in this block if the model, style or catalog number is not
known.

**Block 4.** Enter the first four digits of the National Stock Number,
if known.

**Block 5.** Not applicable.

**Block 6.** Self-explanatory.

\(a\) This clause shall govern with respect to any Government property
furnished to the Contractor for repair or other services that is to be
returned to the Government. Such property, hereinafter referred to as
\"Government property furnished for servicing,\" shall not be subject to
any clause of this contract entitled Government-Furnished Property or
Government Property.

\(b\) The official accountable recordkeeping and financial control and
reporting of the property subject to this clause shall be retained by
the Government. The Contractor shall maintain adequate records and
procedures to ensure that the Government property furnished for
servicing can be readily accounted for and identified at all times while
in its custody or possession or in the custody or possession of any
subcontractor.

\(c\) The Contractor shall be liable for any loss or destruction of or
damage to the Government property furnished for servicing (1) caused by
the Contractor\'s failure to exercise such care and diligence as a
reasonable prudent owner of similar property would exercise under
similar circumstances, or (2) sustained while the property is being
worked upon and directly resulting from that work, including, but not
limited to, any repairing, adjusting, inspecting, servicing, or
maintenance operation. The Contractor shall not be liable for loss or
destruction of or damage to Government property furnished for servicing
resulting from any other cause except to the extent that the loss,
destruction, or damage is covered by insurance (including self-insurance
funds or reserves).

\(d\) In addition to any insurance (including self-insurance funds or
reserves) carried by the Contractor and in effect on the date of this
contract affording protection in whole or in part against loss or
destruction of or damage to such Government property furnished for
servicing, the amount and coverage of which the Contractor agrees to
maintain, the Contractor further agrees to obtain any additional
insurance covering such loss, destruction, or damage that the
Contracting Officer may from time to time require. The requirements for
this additional insurance shall be effected under the procedures
established by the FAR 52.243 changes clause of this contract.

\(e\) The Contractor shall hold the Government harmless and shall
indemnify the Government against all claims for injury to persons or
damage to property of the Contractor or others arising from the
Contractor\'s possession or use of the Government property furnished for
servicing or arising from the presence of that property on the
Contractor\'s premises or property.

**(End of clause)**

**1852.245-73 Financial Reporting of NASA Property in the Custody of
Contractors.**

As prescribed in 1845.106-70(d), insert the following clause:

**FINANCIAL REPORTING OF NASA PROPERTY IN THE**

**CUSTODY OF CONTRACTORS**

**(AUGUST 2001)**

\(a\) The Contractor shall submit annually a NASA Form (NF) 1018, NASA
Property in the Custody of Contractors, in accordance with the
provisions of 1845.505-14, the instructions on the form, subpart
1845.71, and any supplemental instructions for the current reporting
period issued by NASA.

> (b)(1) Subcontractor use of NF 1018 is not required by this clause;
> however, the Contractor shall include data on property in the
> possession of subcontractors in the annual NF 1018.

\(2\) The Contractor shall mail the original signed NF 1018 directly to
the cognizant NASA Center Deputy Chief Financial Officer, Finance,
unless the Contractor uses the NF 1018 Electronic Submission System
(NESS) for report preparation and submission.

\(3\) One copy shall be submitted (through the Department of Defense
(DOD) Property Administrator if contract administration has been
delegated to DOD) to the following address: \[Insert name and address of
appropriate NASA Center office.\], unless the Contractor uses the NF
1018 Electronic Submission System (NESS) for report preparation and
submission.

\(c\) The annual reporting period shall be from October 1 of each year
through September 30 of the following year. The report shall be
submitted in time to be received by October 31. The information
contained in these reports is entered into the NASA accounting system to
reflect current asset values for agency financial statement purposes.
Therefore, it is essential that required reports be received no later
than October 31. The Contracting Officer may, in NASA's interest,
withhold payment until a reserve not exceeding \$25,000 or 5 percent of
the amount of the contract, whichever is less, has been set aside, if
the Contractor fails to submit annual NF 1018 reports in accordance with
1845.505-14 and any supplemental instructions for the current reporting
period issued by NASA. Such reserve shall be withheld until the
Contracting Officer has determined that the required reports have been
received by NASA. The withholding of any amount or the subsequent
payment thereof shall not be construed as a waiver of any Government
right.

\(d\) A final report shall be submitted within 30 days after disposition
of all property subject to reporting when the contract performance
period is complete in accordance with (b)(1) through (3) of this clause.

**(End of clause)**

**1852.245-74 Contractor Accountable On-Site Government Property.**

As prescribed in 1845.106-70(e), insert the following clause:

**CONTRACTOR ACCOUNTABLE ON-SITE GOVERNMENT PROPERTY**

**(MARCH 1989)**

\(a\) In performance of work under this contract, certain Government
property identified in the contract shall be provided to the Contractor
on a no-charge-for-use basis by the installation\'s Supply and Equipment
Management Officer. That property shall be utilized in the performance
of this contract at the installation that provided the property or at
such other installations or locations as may be specified elsewhere in
this contract. The Contractor assumes accountability and user
responsibilities for the property.

\(b\) Government property provided shall in every respect be subject to
the provisions of the FAR 52.245 Government property clause of this
contract. In addition, the contractor is responsible for managing this
property in accordance with the guidelines provided by the
installation\'s Supply and Equipment Management Officer or any other
formally designated representatives of the Contracting Officer. The
guidelines include but are not limited to requiring the Contractor to\--

\(1\) Use economic order quantity (EOQ) methods for routine stock
replenishment;

\(2\) Utilize the Federal Cataloging System;

\(3\) Comply with shelf-life requirements;

\(4\) Provide for accountability and control (using the NASA Equipment
Management

System (NEMS)) of all equipment costing \$1000 and over, plus that
equipment designated as \"sensitive\";

\(5\) Provide for physical inventory of all controlled equipment at
least every 3 years;

\(6\) Provide for sample inventories of materials plus complete
inventories every 5 years;