PART 22

PAYMENTS AND TAXES

# Table of Contents

22.1 BASIS OF PAYMENT. [1](#basis-of-payment.)

22.1.1 Single Payments and Partial Payments.
[2](#single-payments-and-partial-payments.)

22.1.2 Progress Payments. [2](#progress-payments.)

22.1.3 Clause Usage Prescriptions. [3](#clause-usage-prescriptions.)

22.1.4 Advance Payments. [3](#advance-payments.)

22.1.4.1 Authorized Advance Payments. [3](#authorized-advance-payments.)

22.1.4.2 Requirements for Approval of Other Advance Payments.
[4](#requirements-for-approval-of-other-advance-payments.)

22.1.4.3 Interest on Advance Payments.
[4](#interest-on-advance-payments.)

22.1.4.4 Payment of Advances. [5](#payment-of-advances.)

22.1.4.5 Clause Usage Prescriptions. [5](#clause-usage-prescriptions.-1)

22.1.5 Withholding. [5](#withholding.)

22.1.5.1 Clause Usage Prescriptions. [6](#clause-usage-prescriptions.-2)

22.2 PROMPT PAYMENT. [6](#prompt-payment.)

22.2.1 Prompt Payment Discounts. [7](#prompt-payment-discounts.)

22.2.2 Payment Due Dates. [7](#payment-due-dates.)

22.2.3 Interest Penalties. [8](#interest-penalties.)

22.2.4 Documentation of Acceptance. [9](#documentation-of-acceptance.)

22.2.5 Clause Usage Prescriptions. [9](#clause-usage-prescriptions.-3)

22.3 INTEREST ON AMOUNTS DUE BPA. [10](#interest-on-amounts-due-bpa.)

22.3.1 Clause Usage Prescriptions. [10](#clause-usage-prescriptions.-4)

22.4 ASSIGNMENT. [10](#assignment.)

22.5 TAXES. [11](#taxes.)

22.5.1 General. [11](#general.)

22.5.2 General Exemptions. [12](#general-exemptions.)

22.5.3 Applicability of State and Local Taxation.
[13](#applicability-of-state-and-local-taxation.)

22.5.3.1 State and Local Tax Exemptions.
[13](#state-and-local-tax-exemptions.)

22.5.3.2 State of Washington Sales and Use Taxes.
[14](#state-of-washington-sales-and-use-taxes.)

22.5.3.3 State of Idaho Use Tax. [14](#state-of-idaho-use-tax.)

22.5.3.4 Clause Usage Prescriptions.
[15](#clause-usage-prescriptions.-5)

22.6 ELECTRONIC FUNDS TRANSFER. [15](#electronic-funds-transfer.)

22.6.1 Assignment of Claims. [16](#assignment-of-claims.)

22.6.2 Clause Usage Prescriptions. [16](#clause-usage-prescriptions.-6)

22.7 ELECTRONIC RECEIPT SETTLEMENT (ERS) PAYMENT
[16](#electronic-receipt-settlement-ers-payment)

22.7.1 Clause Usage Prescriptions. [17](#clause-usage-prescriptions.-7)

22.50 TEXT OF CLAUSES. [17](#text-of-clauses.)

### 22.1 BASIS OF PAYMENT.

\(a\) ***POLICY:*** Payment provisions shall be drawn with an eye to
balancing the equities of the protection of BPA\'s interests against
adequately compensating the contractor for supplies delivered or
services performed.

\(b\) ***PROCEDURE:*** COs shall consider the following order of
preference when establishing a basis for payment in award documents:

\(1\) Single Payments (Lump Sum) - one payment made after completion and
acceptance of all work.

\(2\) Partial Payments - full payment for completed separately priced
items in the contract. Multiple payments are anticipated.

\(3\) Progress Payments - multiple payments made during performance
based on a percentage or stage of completion.

\(4\) Advance Payments - advances of money in anticipation of
performance.

#### 22.1.1 Single Payments and Partial Payments.

\(a\) ***INFORMATION:*** Single payments are one (lump sum) payment made
after completion and acceptance of all work.

\(b\) ***INFORMATION:*** Partial payments are payments authorized under
a contract, made upon completion of the delivery of one or more complete
units (or one or more distinct items of service), called for, delivered,
and accepted by BPA under the contract. Although partial payments are
generally treated as a method of payment and not as a method of contract
financing, the use of partial payments can assist contractors to
participate in BPA contracts.

\(c\) ***PROCEDURE:*** There are certain circumstances that could
indicate that partial payments are inappropriate, and should be
prohibited. Those circumstances include:

\(1\) When the additional administrative time required to issue 2 or
more payments may not be cost effective.

\(2\) When partial delivery of individual components does not constitute
a usable item on its own.

#### 22.1.2 Progress Payments.

\(a\) ***POLICY:*** Where progress payments are authorized, BPA will
make progress payments on the basis of percentage or stage of
completion. Typical progress payment provisions call for payment of part
of the contract price only when a completed stage of work (milestone) or
a completed component can be said to be of value to BPA in the event the
contract were to be terminated at that point. However, progress payment
schedules can be negotiated that will allow payment based on an
estimated percentage of completion.

\(b\) ***PROCEDURE:*** (1) The CO may provide for progress payments if
the contractor \--

\(A\) Will not be able to bill for the first delivery of products, or
other performance milestones, for a substantial time after work is
scheduled to begin, and

\(B\) Will make expenditures for contract performance during the
pre-delivery period that have a significant impact on the contractor\'s
working capital.

\(2\) When there is reason to doubt the amount of a progress payment
request, only the doubtful amount should be withheld, subject to later
adjustment after review or audit; any clearly proper and due amounts
should be paid without awaiting resolution of the differences.

\(3\) Post-payment reviews may be made when considered desirable by the
CO to determine the validity of progress payments already made and those
expected to be made. The post-payment review should include a review of
whether or not the unpaid balance of the contract price will be adequate
to cover the anticipated cost of completion.

#### 22.1.3 Clause Usage Prescriptions.

***PROCEDURES:***

\(a\) The CO shall include clause 22-2, Basis of Payment \-- Progress
Payments (Construction Contracts), in all fixed-price construction
solicitations and contracts when progress payments are anticipated. The
CO may modify the percentage specified in paragraph (a) for payment of
material delivered on site but not yet installed. The CO may include the
clause in solicitations and contracts when a fixed price service
contract for dismantling, demolition or removal of improvements is
expected.

\(b\) The CO may include a clause similar to 22-3, Basis of Payment -
Progress Payments, in fixed-price solicitations and contracts for other
than construction when progress payments are anticipated.

\(c\) The CO shall include clause 22-4, Basis of Payment \--
Time-and-Materials Contracts, in solicitations and contracts when a
time-and-materials basis for payment is contemplated.

\(d\) The CO shall include clause 22-5, Basis of Payment \-- Cost
Reimbursement, in all cost reimbursement contracts.

\(e\) The CO shall include clause 22-6, Predetermined Final Indirect
Cost Rates, in Intergovernmental Contract\'s (IGCs) and other
solicitations and contracts when a cost-reimbursement contract with an
educational institution is contemplated and predetermined final indirect
cost rates are to be used.

\(f\) The CO shall include clause 22-7, Contract Ceiling Limitation, in
intergovernmental contracts and other solicitations and contracts if a
cost-reimbursement or time-and-materials contract is contemplated.

\(g\) The CO shall include clause 22-19, Fixed Indirect Cost Rates with
Carry-forward, in Intergovernmental Contracts (IGCs) and other contracts
when a cost-reimbursement contract is contemplated, and fixed indirect
cost rates with carry-forward are to be used.

#### 22.1.4 Advance Payments.

***POLICY:***

\(a\) "Contract financing," as defined in 22.2(c), shall be provided by
BPA only to the extent actually needed for prompt and efficient
performance, considering the availability of private financing. Any
undue risk of monetary loss to BPA through the financing shall be
avoided. Advance payment is a form of contract financing.

\(b\) Contract financing methods are intended to be self-liquidating
through contract performance. BPA may use the methods only for financing
of contractor working capital, not for the expansion of contractor-owned
facilities or the acquisition of fixed assets.

\(c\) Advance payments shall be authorized sparingly. They should be
authorized only if partial payments or progress payments are not
feasible and private financing is not reasonably available.

##### 22.1.4.1 Authorized Advance Payments.

***Procedure**:* The items authorized for advance pay below do not
require additional review and approval by the HCA. All others not
identified below require submittal to the HCA (see 22.1.4.2) for
approval. Payments under time-and-material or cost-reimbursement
contracts made to small businesses in advance of their payment to their
suppliers or subcontractors (see BPI clauses 22-4 and clauses 22-5) are
not considered advance payments under this subpart.

\(a\) Rent (leases, and rental agreements, including meeting and lodging
room rentals);

\(b\) Tuition and conference registration fees;

\(c\) Insurance premiums;

\(d\) Extension or connection of public utilities for BPA buildings or
installations;

\(e\) Subscriptions to publications - interpreted to include electronic
methods of data recording. Software subscription services are therefore
authorized;

\(f\) Purchases of supplies or services in foreign countries, if the
purchase price does not exceed \$10,000 and the advance payment is
required by the laws or regulations of the foreign country concerned;

\(g\) Advance payments to Federal agencies; and

\(h\) Advance payments to Intergovernmental Contract (IGC) organizations
other than Federal agencies, as defined in 25.1(a), require prior
approval by the CO's purchasing Performance Manager. Requirements for
approval shall be similar to the HCA approval procedure in 22.1.4.2.

##### 22.1.4.2 Requirements for Approval of Other Advance Payments.

***Procedure:*** The CO shall transmit the following together with a
recommendation of approval of a contractor\'s request for advance
payment to the HCA:

\(a\) A summary of the solicitation or contract requirements;

\(b\) Comments on (1) the contractor\'s need for advance payments and
(2) potential benefits to BPA from providing advance payments;

\(c\) CO\'s proposed actions to minimize BPA\'s risk of loss from
providing advanced payment;

\(d\) Proposed advance payment contract terms; and

\(e\) Justification of any proposal for waiver of interest charges (see
22.1.4.3).

##### 22.1.4.3 Interest on Advance Payments. 

***POLICY:***

\(a\) BPA will charge interest daily on the amount of advance payments
received by the Contractor in excess of the Contractor\'s current needs.
Federally recognized Indian Tribes, Federal agencies, State governments
or instrumentalities thereof, as defined in 25.1(a), will not be
required to repay interest earned on advanced payments. The CO may,
however, require Contractor-agencies, other than Federal agencies as
defined in 25.1(a) and (c), to pay interest on unliquidated amount of
advances that the CO determines unreasonably exceeds that
Contractor-agency's current needs. The interest will be charged at the
higher of Department of Treasury current value of funds rate or the BPA
cost of borrowing rate.

\(b\) The HCA may authorize advance payments without requiring repayment
of interest if advantageous to BPA.

##### 22.1.4.4 Payment of Advances.

\(a\) ***POLICY:*** Advance payments shall be processed in the following
manner. Letters of Credit are not authorized at BPA. Payments will be
made by electronic funds transfer. Payment will only be made by direct
Treasury check when electronic funds transfer is not possible.

\(1\) 30-Day Advance: The contractor is authorized to request, in
writing, BPA funds in amounts needed to cover its own disbursements of
cash in the next 30 calendar days for contract performance. The
contractor\'s request typically requires 5 working days for processing.
The 30-day advance is the preferred method of providing advance funds to
a contractor.

\(2\) Less than 30-Day Advance: In lieu of a Letter of Credit, the
contractor is authorized to request BPA funds in amounts needed to cover
its own disbursements of cash for periods of less than 30 calendar days
for contract performance. When this payment method is selected, BPA will
deposit funds in the contractor\'s designated account within 5 working
days after BPA receipt of the request. The request shall be made to
BPA\'s Disbursement Operations as required by its procedures. This
method of providing advance funds to a contractor is the least preferred
method and shall be used sparingly.

\(b\) ***INFORMATION:*** BPA may terminate advance payments if the
contractor is unwilling or unable to minimize the elapsed time between
receipt of the advance and disbursement of the funds. In lieu of
termination, the CO may require the contractor to not request BPA funds
until the contractor\'s checks are ready to be forwarded to the payees.

##### 22.1.4.5 Clause Usage Prescriptions.

\(a\) Where the CO wants advances to cover the next 30 days and
accumulated interest to be repaid to BPA: The CO shall include clause
22-8, Advance Payments, in all solicitations and contracts when advance
payments, other than those authorized under subpart 22.1.4.1, are
contemplated. If the CO wants to limit the total value of advance
payments, add a paragraph to the clause stating the limits of advance
funding.

\(b\) Where the CO wants advances to cover the contractor\'s immediate
(less than 30-day) needs and accumulated interest to be repaid to BPA:
The CO shall substitute paragraph (a) shown in Alternate I.

\(c\) Where the CO wants advances to cover the contractor\'s immediate
(less than 30-day) needs and payment of accumulated interest to BPA has
been waived in accordance with subpart 22.1.4.3: The CO shall substitute
paragraphs (a) and (k) shown in Alternate II and delete paragraph (l)

\(d\) Where the CO wants advances to cover the next 30 days and payment
of accumulated interest to BPA has been waived in accordance with
22.1.4.3, the CO shall substitute paragraph (k) shown in Alternate III
and delete paragraph (l).

\(e\) See BPI 25.3 for Advance Payment clauses applicable to
Intergovernmental contracts.

#### 22.1.5 Withholding.

\(a\) ***POLICY:*** The CO shall not routinely withhold funds from
contractor payments. The CO shall consider a withholding only when a
contractor has not achieved satisfactory progress during any period for
which a payment is to be made or when the CO expects difficulty in the
timely and complete receipt of information required by the contract or
when BPA has no verifiable record of past performance.

\(b\) ***INFORMATION:*** Withholding should not be used as a substitute
for good contract management, and COs should not withhold funds without
cause. Decisions to withhold and the specific amount to be withheld
shall be made by the CO on a case-by-case basis. Such decisions will be
based on the CO\'s assessment of past performance and the likelihood
that such performance will continue.

\(c\) ***PROCEDURE:***

\(1\) Generally, the CO shall not withhold an amount greater than 10% of
the total contract amount, and shall withhold only in those specific
instances where the CO has determined, in writing, that it is necessary
to protect the interests of BPA.

\(2\) Upon completion of all contract requirements, withheld amounts
shall be promptly released for payment.

##### 22.1.5.1 Clause Usage Prescriptions.

***PROCEDURE:*** The CO may include clause 22-9, Withholding, in all
solicitations and contracts except when a cost reimbursement contract, a
contract for commercial supplies, commercial services, or commercial
construction is contemplated. The CO may add a paragraph similar to
paragraph (c) shown in Alternate 1 when equipment warranties, specified
written warranties, owner\'s manuals, operating instructions or other
documentation is required by the contract. The CO shall specify the
maximum percentage of the contract amount to be withheld.

### 22.2 PROMPT PAYMENT.

\(a\) ***POLICY:*** Payments shall be made in accordance with the Prompt
Payment regulations at 5 CFR Part 1315. All written contracts shall
specify payment due dates and proper invoice requirements, except fixed
price contracts that authorize payment exclusively using the Evaluated
Receipt Settlement (ERS) method and do not require invoices.

\(b\) ***PROCEDURE***:

\(1\) For all contracts that do not utilize the ERS payment method,
payment will be based on receipt of a proper invoice (as defined in
22.2(c), satisfactory contract performance, and receipt of the
recipient's Taxpayer Identification Number (TIN) and other banking
information required to process payment (see 4.1.2 and 22.6).

\(2\) For all fixed price supply contracts that utilize the ERS payment
method, payment will be based upon the information contained in the
electronic purchase order, the receiving data that is entered into the
electronic inventory receiving system, and the Taxpayer ID and banking
information maintained by the Vendor Maintenance Team.

\(3\) When specifying the frequency of billing, full consideration
should be given to the time and resources required by BPA to process
multiple payments. Generally, contractors may bill no more often than
monthly, unless the CO approves a more frequent period. Billings under
cost reimbursement contracts are usually not accepted more frequently
than every two weeks.

\(4\) Except as provided by 22.6(d), disagreements shall be referred to
the CO for final decision after consulting with such other BPA offices
as determined necessary by the CO.

\(5\) Questions concerning delinquent payments should be directed to the
designated billing office.

\(c\) ***INFORMATION:***

> ***DEFINITIONS*:**

\"Certified Invoice\" means, as used within this subpart, written
evidence which indicates BPA acceptance of services performed by the
contractor.

"Contract financing payments" means authorized disbursement of monies
prior to acceptance of supplies or services including advance payments,
progress payments based on cost, progress payments (other than under
construction contracts or architect-engineer contracts) based on a
percentage or stage of completion where payment is not based upon
acceptance of work delivered or rendered for which a price is separately
stated, and interim payments on cost-type contracts.

\"Designated billing office, \"means the BPA office or person designated
in the contract to receive the contractor's invoices.

\"Due date\" means the date on which payment should be made according to
the terms of the contract.

\"Payment date\" means the date on which a check for payment is dated or
the date electronic funds transfer is made.

\"Proper invoice\" means a bill or written request for payment (invoice)
containing all necessary information required by BPA's Disbursement
Operations for payment, as described in the billing instructions within
the contract payment clause and other terms and conditions for invoice
submission contained in the contract.

\"Receiving report\" means written documentation or data entered into
the BPA ERP system that is indicates BPA acceptance of supplies
delivered.

#### 22.2.1 Prompt Payment Discounts.

\(a\) ***POLICY:*** COs are encouraged to negotiate meaningful discounts
for prompt payment whenever possible.

\(b\) ***INFORMATION:***

\(1\) Decisions to accept or not accept a prompt payment discount are
made by BPA Cash Manager based on the value of the discount offered
compared to BPA cost of money. There is no minimum time period for which
discounts will be taken; any discount will be taken if determined cost
effective by the BPA Cash Manager. When BPA cost of money exceeds the
value of the discount, the discount will not be taken.

\(2\) Information on this policy can be obtained from the BPA Cash
Manager.

#### 22.2.2 Payment Due Dates.

\(a\) ***POLICY:*** For the sole purpose of computing an interest
penalty that might be due the contractor, COs shall establish a period
for acceptance that reflects the minimum time necessary for inspection
or testing. The period shall be no shorter than 7 days nor longer than
30 days after the contractor has delivered supplies or performed
services in accordance with the terms and conditions of the contract.

\(b\) ***INFORMATION:***

\(1\) The due date for most transactions, (e.g. lump sum payments,
partial payments, etc.) shall be not later than the 30th day after BPA
receives a proper invoice in the designated billing office, or not later
than the 30th day after BPA acceptance of supplies delivered or services
rendered, whichever is later.

\(2\) For all progress payments except construction, the due date shall
be not later than the 30th day after BPA approval of contractor
estimates of work or of services accomplished. For the sole purpose of
computing an interest penalty that might be due the contractor, BPA
approval shall be deemed to have occurred constructively on the 7th day
after the contractor estimates are received by BPA.

\(3\) Progress payments under construction contracts shall be due not
later than the 14th day after receipt of a proper invoice by the
designated billing office. The CO has the discretion to specify a longer
period, not to exceed 30 days, if more time is required to afford BPA a
reasonable opportunity to adequately inspect the work and to determine
the adequacy of the contractor\'s performance under the contract.

\(4\) For payment of any amounts retained by the CO, the due date shall
be not later than the 30th day after approval by the CO for release to
the contractor.

\(5\) Final Payments shall be due not later than the 30th day after BPA
receives a proper invoice in the designated billing office, or not later
than the 30th day after BPA acceptance of the work or services,
whichever is later. On final payments where the amount is subject to
contract settlement actions, acceptance shall be deemed to have occurred
on the effective date of the contract settlement.

#### 22.2.3 Interest Penalties.

***INFORMATION:***

\(a\) An interest penalty shall be paid automatically without request
from the contractor, when all of the following conditions, if
applicable, have been met:

\(1\) A proper invoice has been received.

\(2\) Contractor has provided its taxpayer identification number (TIN)
and other banking information necessary to process payment, as per 31
U.S.C. 3332 (see 22.6).

\(3\) There is no disagreement over quantity, quality, or contractor
compliance with any contract requirement.

\(4\) In the case of a final invoice, the payment amount is not subject
to dispute or to further contract settlement negotiations between BPA
and the contractor.

\(5\) BPA paid the contractor after the due date.

\(6\) Interest owed is over \$1.00 in value.

\(b\) The interest penalty shall be at the rate established by the
Secretary of the Treasury under section 12 of the Contract Disputes Act
of 1978 (41 U.S.C. 611) that is in effect on the day after the due date.

\(c\) Interest penalties under the Prompt Payment Act will not continue
to accrue (1) after the filing of a claim for such penalties under the
disputes clause of the contract, if included, or (2) for more than 1
year.

\(d\) Interest penalties are not required on payment delays due to
defective invoices, disagreement between BPA and contractor over the
payment amount, or other issues involving contract compliance, or on
amounts temporarily withheld or retained in accordance with the terms of
the contract. Claims involving disputes, and any interest that may be
payable, will be resolved in accordance with the disputes clause.

\(e\) No interest penalty shall be paid to the contractor as a result of
delayed contract financing payments (see 22.2(c) for definition of
"contract financing payments").

#### 22.2.4 Documentation of Acceptance.

***PROCEDURE:***

\(a\) For payment purposes, BPA acceptance will be documented on either
a receiving report or by certified invoice. The receiver or approving
party should enter the receipt or invoice information into the BPA ERP
system within 3 business days of receipt or acceptance of the goods or
services. Contractors are required to submit all original invoices and
supporting documentation to the address indicated within the contract.
The receiving report or certified invoice shall, as a minimum, include
the following:

\(1\) Contract number or other authorization for supplies delivered or
services performed;

\(2\) Description of supplies delivered or services performed;

\(3\) Quantities of supplies received and accepted, if applicable;

\(4\) Date supplies delivered or services performed;

\(5\) Date supplies or services were accepted by the designated BPA
official (or progress payment request was approved); and

\(6\) Signature, printed name, and title of the designated BPA official
responsible for acceptance or approval.

\(b\) The designated billing office, as indicated in the contract, shall
immediately mark each invoice with the date the invoice is received.

#### 22.2.5 Clause Usage Prescriptions.

***PROCEDURE:***

\(a\) The CO may include clause 22-10, Discounts for Prompt Payment, in
fixed price solicitations and contracts.

\(b\) The CO shall include clause 22-11, Payment \-- Construction
Contracts, in solicitations and contracts for construction when progress
payments are anticipated and clause 22-2, Basis of Payment \-- Progress
Payments (Construction Contracts), is used. Paragraph (b)(1), Payment
Due Dates, may be modified to establish a due date longer than 14 days
if the CO justifies the need in writing. The face page of the award form
shall indicate the address to which invoices are to be sent for
processing.

\(c\) The CO shall include clause 22-12, Payment, in all solicitations
and contracts for service and supply, including Intergovernmental
Contract's with Indian Tribes and all non-Federal governmental entities
paid in arrears (see 25.3). Do not use this clause when contract
financing will be used (see definition at 22.2(c)). It shall also be
included in construction solicitations and contracts when progress
payments are not anticipated (i.e., payment will be made only on a
single payment or a partial payment basis.) The CO may modify the clause
to change the frequency of payments (see BPI 22.2), and to eliminate the
requirement for written invoices on fixed price supply contracts using
the Evaluated Receipt Settlement (ERS) payment method. The face page of
the award form shall indicate the address to which invoices are to be
sent for processing.

### 22.3 INTEREST ON AMOUNTS DUE BPA.

***POLICY:***

\(a\) BPA shall apply interest charges to any contract debt unpaid after
30 days from the issuance of a demand, unless\--

\(1\) The contract specifies another due date or procedure for charging
or collecting interest; or

\(2\) The contract is a kind excluded under 22.3.1; or

\(3\) The contract or debt has been exempted from interest charges under
BPA Financial Operations procedures.

\(b\) If not already applicable under the contract terms, interest on
contract debt shall be made an element of any agreement entered into on
deferment of collection.

#### 22.3.1 Clause Usage Prescriptions.

***PROCEDURE:*** The CO shall include clause 22-13, Interest on Amounts
Due BPA, in solicitations and contracts in excess of \$100,000 for
non-commercial goods or services.

### 22.4 ASSIGNMENT.

\(a\) ***POLICY:*** Normally BPA will permit assignments in order to aid
contractors in obtaining independent financing. As assignments are
common practice in the commercial marketplace, BPA will accept
assignment documents prepared by a financial institution and signed by
an officer of the financial institution. However***,*** when the
contract provides for advance payments, assignment of contract payments
will not be permitted.

\(b\) ***INFORMATION:***

\(1\) \"Assignment of contract payments\" means the transfer or making
over by the contractor to a bank, trust company, or other financing
institution, as security for a loan to the contractor, of its right to
be paid by BPA for contract performance.

\(2\) An assignment of contract payments extinguishes the right of the
transferor (assignor, contractor) to all future payments due under the
contract, and establishes that right in the transferee (assignee,
financial institution). Requests from contractors or financial
institutions regarding assignments are processed by the CO. Generally a
contractor will advise the CO that an assignment is contemplated. The
assignment becomes effective upon written acknowledgment by the CO.

\(3\) Extent of assignee\'s protection. BPA may not recover payments
made to the assignee. This immunity of the assignee is effective whether
the contractor\'s liability arises from or independently of the assigned
contract.

\(4\) A contractor may assign payments due or to become due under a
contract if all the following conditions are met:

\(A\) The assignment is made to a bank, trust company, or other
financing institution, including any Federal lending agency;

\(B\) The assignment covers all unpaid amounts payable under the
contract; and

\(C\) The contract terms do not expressly prohibit the assignment.

\(c\) ***PROCEDURE:***

\(1\) Upon notification of a desire for an assignment, the CO shall:

\(A\) Contact the HCA for assignment processing procedures; and

\(B\) Notify the disbursing officer of the pending assignment.

\(C\) Immediately notify the disbursing officer when assignment is
accepted and ensure delivery of the instrument to the disbursing
officer. This is especially important to ensure that the payment is made
to the assignee (see 22.6.1).

\(2\) A release of assignment is required whenever the contractor wishes
to reestablish its right to receive further payments after the
contractor\'s obligations to the assignee have been satisfied and a
balance remains due under the contract.

### 22.5 TAXES.

***POLICY:***

\(a\) COs shall consult BPA\'s Office of General Counsel before
determining whether or not a tax is valid or applicable or before
obtaining exemption from, or refund of, a tax.

\(b\) While state governments are prohibited from directly taxing the
Federal Government, BPA shall pay all applicable state taxes imposed on
contractors as part of the award price. Contract modifications will be
issued to reimburse the contractor for any Federal excise taxes or
duties which are passed by Congress after award or as to which
exemptions are removed after award. The contractor shall be responsible
for any state or local taxes which are passed or increased or as to
which exemptions are removed or reduced after award; and there shall be
no additional compensation from BPA for any such taxes.

\(c\) When the constitutional immunity of BPA from state or local
taxation may reasonably be at issue, contractors should be discouraged
from negotiating independently with taxing authorities if the contract
contains a tax escalation clause.

\(d\) COs will refer prospective offerors to their own legal counsel for
a determination as to the applicability of taxes to contractors doing
business with BPA.

\(e\) COs should solicit prices on a tax-exclusive basis when it is
known that BPA is exempt from these taxes and the exemption is at least
\$250.

\(f\) BPA shall take maximum advantage of available Federal excise tax
and duty exemptions.

\(g\) The contract price of supplies shall not include the
manufacturers\' excise tax on parts or accessories purchased by BPA for
use in the manufacture of any article.

#### 22.5.1 General.

***INFORMATION:***

\(a\) Federal excise taxes are levied on the sale or use of particular
supplies or services. An excise tax is similar to a sales tax. The most
common excise taxes are \--

\(1\) Manufacturers\' excise taxes imposed on certain motor-vehicle
articles, gasoline, lubricating oils, coal, fishing equipment, firearms,
shells, and cartridges sold by manufacturers, producers, or importers;
and

\(2\) Special-fuels excise taxes imposed at the retail level on diesel
fuel and special motor fuels.

\(b\) Federal excise taxes are usually paid by the seller and included
in the sales price. Sometimes the law exempts the Federal Government
from these taxes. COs should solicit prices on a tax-inclusive basis
when no exemption exists and on a tax-exclusive basis when it is known
that BPA is exempt from these taxes.

#### 22.5.2 General Exemptions.

***INFORMATION:***

\(a\) No Federal manufacturers\' or special-fuels excise taxes are
imposed in many contracting situations as, for example, when the
supplies are for any of the following:

\(1\) The exclusive use of any state or political subdivision,

\(2\) Further manufacture, or resale for further manufacture (this
exemption does not include tires and inner tubes),

\(3\) A nonprofit educational organization, or

\(4\) Emergency vehicles.

\(b\) The Secretary of the Treasury has exempted the United States from
the communications excise tax imposed in 26 U.S.C. 4251, when the
supplies and services are for the exclusive use of the United Sates.

\(c\) The Secretary of the Treasury has exempted the United States from
the federal highway vehicle users tax imposed in 26 U.S.C. 4481. The
exemption applies whether the vehicle is owned or leased by the United
States.

#### 22.5.3 Applicability of State and Local Taxation.

\(a\) ***POLICY:***

\(1\) Generally, purchases and leases made by and for BPA\'s use are
exempt from state and local taxation. For specific advice and
assistance, COs shall contact BPA\'s Office of General Counsel.

\(2\) BPA shall pay all applicable state and local taxes imposed on
contractors as part of the award price. For specific advice and
assistance, COs shall contact BPA\'s Office of General Counsel.

\(3\) BPA shall take maximum advantage of all available exemptions in
excess of \$250 from state and local taxation.

\(4\) The applicability of state and local taxes to purchases by BPA may
depend on the place and terms of delivery. When the contract price will
be substantial, alternative places and terms of delivery should be
considered in light of possible tax consequences.

\(5\) Prime contractors and subcontractors shall not normally be
designated as agents of BPA for the purpose of claiming immunity from
state or local sales or use taxes. Before any designation is made, the
matter shall be referred to the HCA for review.

\(6\) When purchases are not made by BPA itself, but by a prime
contractor or by a subcontractor under a prime contract, the right to an
exemption shall be determined by the legal counsel of the contractor or
subcontractor.

\(7\) Frequently, property (including property acquired under the
progress payments clause or under the BPA property clause of
cost-reimbursement contracts) owned by BPA is in the possession of a
contractor or subcontractor. Situations may arise in which states or
localities assert the right to tax BPA property directly or to tax the
contractor\'s or subcontractor\'s possession of, interest in, or use of
that property. BPA\'s Office of General Counsel shall review such cases
and advise the CO on the appropriate course of action.

\(b\) ***INFORMATION:*** The imposition of state and local taxes may
result in special contract considerations including the following:

\(1\) With coordination of BPA\'s Office of General Counsel, a contract
may state that the contract price includes or excludes a specified tax
or require that the contractor take certain actions with regard to
payment, nonpayment, refund, protest, or other treatment of a specified
tax. Such special treatment may be appropriate when there is doubt as to
the applicability or allocability of the tax, or when the applicability
of the tax is being litigated.

\(2\) Indefinite-delivery contracts (including those for leased
equipment) may require the contractor to furnish equipment in more than
one state. As states and local governments impose a wide variety of
sales, property, use, or other taxes, the CO shall consider the risk to
BPA of having contractors include taxes in the contract price when the
place of delivery is not known at the time of contract award.

##### 22.5.3.1 State and Local Tax Exemptions.

\(a\) ***INFORMATION:*** Evidence of exemptions. Evidence needed to
establish exemption or immunity from state or local taxes depends on the
grounds for the exemption or immunity claimed, the parties to the
transaction, and the requirements of the taxing jurisdiction. Such
evidence may include the following:

\(1\) A copy of the contract or relevant portion.

\(2\) Copies of purchase orders, shipping documents,
credit-card-imprinted sales slips, paid or acknowledged invoices, or
similar documents that identify BPA as the buyer.

\(3\) A State or local form indicating that the supplies or services are
for the exclusive use of BPA.

\(4\) Any other State or locally required document for establishing
general or specific exemption.

\(5\) Shipping documents indicating that shipments are in interstate or
foreign commerce.

\(b\) ***PROCEDURE:*** Furnishing proof of exemption. If a reasonable
basis to sustain a claimed exemption exists, the seller will be
furnished evidence of exemptions, as follows:

\(1\) Under a cost-reimbursement contract: At the discretion of the CO.

\(2\) Under a fixed price contract: If requested by the contractor and
the contractor either certifies that the contract price does not include
the tax or, if the transaction is for property which is tax exempt,
consents to a reduction in the contract price.

##### 22.5.3.2 State of Washington Sales and Use Taxes.

\(a\) ***INFORMATION:*** The State of Washington has enacted legislation
subjecting materials to be incorporated into construction projects and
BPA-owned property, materials and equipment used by contractors in
constructing projects in the State of Washington to sales and use taxes.

\(b\) ***INFORMATION:*** Washington State gasoline tax.

The Revised Code of Washington (RCW) at Chapter 82.36 imposes a tax on
gasoline sold, used, or distributed in the state. The tax is imposed on
the distributor, and is passed on as a cost to the purchaser. On such a
tax, BPA has no basis to claim immunity, and must pay costs.

\(c\) ***INFORMATION:*** Washington State diesel fuel tax.

The Revised Code of Washington (RCW) at Chapter 82.38 imposes a tax on
the users of diesel fuel within the state. This tax may not be imposed
on BPA, and the State specifically recognizes the federal exemption at
RCW 82.38.80.

##### 22.5.3.3 State of Idaho Use Tax.

***INFORMATION:*** The State of Idaho has enacted legislation subjecting
BPA-owned property, materials and equipment used by contractors in
constructing projects for BPA to a use tax. Examples include tower
steel, conductor, hardware and accessories, and substation equipment and
materials installed by contractors. Also included are materials
purchased by contractors in constructing a facility and which form a
part of that facility. Not included are materials consumed, partially or
entirely in performing the construction.

##### 22.5.3.4 Clause Usage Prescriptions.

***PROCEDURE:***

\(a\) The CO shall include clause 22-14, Taxes \-- Indefinite Delivery
Contracts, in solicitations and contracts for equipment (including
leased equipment) and services, when a fixed price indefinite delivery
contract is contemplated and the place or places of delivery could be in
more than one state and are not specifically known at the time of
contracting.

\(b\) The CO shall include clause 22-15, Federal, State and Local Taxes,
in solicitations and contracts over \$100,000 if a fixed price or time
and materials contract is contemplated for other than commercial
supplies and services (including construction).

\(c\) The CO shall include clause 22-16, Taxes and Duties, in all
solicitations and contracts under \$100,000, and in solicitations and
contracts of any dollar amount for commercial supplies, commercial
services, or commercial construction.

\(d\) The CO shall include clause 22-17, Washington State Sales and Use
Taxes, in all solicitations and contracts requiring construction to be
performed wholly or partly in the State of Washington.

\(e\) The CO shall include clause 22-18, State of Idaho Use Tax, in all
solicitations and contracts requiring construction in the State of
Idaho.

### 22.6 ELECTRONIC FUNDS TRANSFER.

***POLICY:***

\(a\) Electronic funds transfer (EFT) shall be used as the primary
payment method for contract invoice and contract financing payments as
required by 31 U.S.C. 3332(e), with only limited exceptions. Government
purchase card transactions are not subject to the requirements of this
subpart.

\(b\) Exempted from the EFT payment method are:

\(1\) A contract or agreement which uses a government purchase card as
the exclusive means of payment; and

\(2\) Contracting conditions that limit the use of EFT payment, as
described in 31 CFR 208.3(c) (such as, emergency, security, or foreign
payment considerations). The CO shall coordinate with the Vendor File
Maintenance Team and Disbursement Operations on alternatives to EFT
payment, and document the solicitation file with a record of such
discussions and the selected payment alternative.

\(c\) EFT payment processing requires that the Contractor provide its
taxpayer identification number (TIN) and other banking information
necessary for EFT payment processing. This information is required by 31
U.S.C. 3332 and 7701 as a condition of payment (see 4.1). BPA will
protect against improper disclosure of a Contractor's EFT banking
information.

\(d\) ***PROCEDURE:*** The Contractor shall submit banking information
to the BPA Vendor File Maintenance Team, as per clause 22-20, Electronic
Funds Transfer Payment. BPA will not require a Contractor to resubmit
its TIN and other banking information for each contract, provided this
information is current and on file with BPA. If the Contractor's banking
information has changed, the Contractor shall be responsible to verify
and resubmit changed information directly to the Vendor File Maintenance
Team.

#### 22.6.1 Assignment of Claims.

***INFORMATION:*** Disbursement Operations will utilize the most current
banking information that the Contractor has submitted to the Vendor File
Maintenance Team to process EFT payment, unless otherwise notified by
the Contractor. A timely and properly executed assignment of claims (see
22.4) is critical for ensuring payment to the assignee, and not to the
Contractor's account. EFT information which shows the ultimate recipient
of the transfer to be other than the Contractor, in the absence of a
proper assignment of claims, is considered to be incorrect EFT
information within the meaning of the "Suspension of Payment" paragraph
of clause 22-20, Electronic Funds Transfer Payment.

#### 22.6.2 Clause Usage Prescriptions.

***PROCEDURE:***

\(a\) The CO shall include clause 22-20, Electronic Funds Transfer
Payment, in all solicitations and contracts not otherwise exempt by
22.6(b).

\(b\) Oral solicitations (see 11.10.1) or oral solicitations and
resultant oral contracts for commercial services, such as commercial
utility services (see 11.2) must be paid by EFT, unless otherwise exempt
by 22.6(b). When conducting an oral solicitation, the CO shall advise
the Contractor that payment will be made by EFT, except as noted in
22.6(b), and include clause 22-20, Electronic Funds Transfer Payment, in
any written contract resulting from oral solicitation procedures. If not
already on file, the CO shall notify the Contractor of procedures for
submission of the required banking information to the Vendor Maintenance
Team, in the manner and time period required by clause 22-20, Electronic
Funds Transfer Payment.

### 22.7 ELECTRONIC RECEIPT SETTLEMENT (ERS) PAYMENT

\(a\) ***INFORMATION**:* Using the BPA's Enterprise Resource Planning
(ERP) system, the CO may authorize Electronic Receipt Settlement (ERS)
payment processing. This payment method requires a two-way match of (1)
item quantities and prices as stated on the purchase order, and (2)
items received and accepted. It does not require an invoice from the
Contractor. ERS payment processing may reduce administrative cost, time,
and effort for both BPA and the Contractor. It is best suited for master
contracts and master agreements with multiple releases, and other
frequent and repetitive purchases of fixed price supplies that don't
require separate payment for other charges.

\(b\) ***POLICY:*** The ERS payment method may be used only for fixed
price supplies with clearly defined quantities and unit prices. It is
not recommended for contracts where certain items must be invoiced
separately, such as transportation, taxes or installation services. If
these items are not included in the negotiated unit price(s), the
Contractor must invoice separately for these charges. The Contracting
Officer must assess the value of using this payment method against the
additional administrative effort of monitoring the separate invoices and
take positive steps to minimize the risk for improper or duplicate
payments.

\(c\) ***PROCEDURE:*** When the ERS payment method is used, the CO shall
select this payment method in the Enterprise Resource Planning system.
Buyers are encouraged to coordinate their use of the ERS payment method
with Disbursement Operations, and to apply this payment method to all
awards made to a particular Contractor, avoiding possible confusion for
the Contractor and BPA when invoices are required for one purchase order
and not another.

#### 22.7.1 Clause Usage Prescriptions.

***PROCEDURE:*** The CO shall include clause 22-21, Electronic Receipt
Settlement (ERS) Payments, in all solicitations and contracts for fixed
price supplies, when electronic payment processing is desired and
invoices are not required.

### 22.50 TEXT OF CLAUSES.

The following clauses are referenced in Part 22:

22-1 Reserved

22-2 Basis of Payment \-- Progress Payments (Construction Contracts)

22-3 Basis of Payment \-- Progress Payments

22-4 Basis of Payment \-- Time-and-Materials Contracts

22-5 Basis of Payment \-- Cost Reimbursement

22-6 Predetermined Indirect Cost Rates

22-7 Contract Ceiling Limitation

22-8 Advance Payments

22-9 Withholding

22-10 Discounts for Prompt Payment

22-11 Payment \-- Construction Contracts

22-12 Payment

22-13 Interest on Amounts Due BPA

22-14 Taxes \-- Indefinite Delivery Contracts

22-15 Federal, State and Local Taxes

22-16 Taxes and Duties

22-17 Washington State Sales and Use Taxes

22-18 State of Idaho Use Tax

22-19 Fixed Indirect Cost Rates with Carry-forward

20. Electronic Funds Transfer Payment

21. Electronic Receipt Settlement (ERS) Payments

######### Clause 22-1 RESERVED

######### Clause 22-2 BASIS OF PAYMENT \-- PROGRESS PAYMENTS (CONSTRUCTION CONTRACTS) (Sep 98)(BPI 22.1.3)

\(a\) Progress payments. BPA shall make progress payments as the work
proceeds based on its assessment of the stage or percentage of work
accomplished. BPA may include in the calculation of progress, 75 percent
of the cost of material delivered to the site but not yet installed. The
Contractor shall submit supplier invoices to verify such cost of
material. The Contractor shall furnish a breakdown of the work as a
percentage of total contract price, in such detail as required by the
CO. (See clause 24-10, Price Data Sheet).

\(b\) Interest on unearned amounts. After making a request for progress
payment, if all or a portion of the request constitutes a payment for
performance by the Contractor (or any subcontractors or suppliers) that
fails to conform to the requirements of the contract, the Contractor
shall (1) notify the CO of the performance deficiency and (2) pay BPA an
amount equal to interest on the unearned amount from the date of receipt
of the unearned amount until the date that the performance deficiency
has been corrected or until the contractor reduces the amount of any
subsequent request for progress payments by the unearned amount.

\(c\) Title to all material and work covered by progress payments made
shall pass to BPA at the time of payment. This shall not be construed
as\--

\(1\) Relieving the Contractor from the sole responsibility for all
material and work upon which payments have been made or the restoration
of any damaged work; or

\(2\) Waiving the right of BPA to require the fulfillment of all of the
terms of the contract.

\(d\) Performance and payment bond premiums paid by the Contractor will
be reimbursed by BPA after the Contractor has furnished evidence of full
payment to the surety.

\(e\) Partial Payments. Unless otherwise specified, payment shall be
made after acceptance of any portion of the work delivered or rendered
for which a price is separately stated in the contract.

\(f\) Final Payment. BPA shall pay the amount due the Contractor under
this contract after completion and acceptance of all work and after
presentation of a release of all claims against BPA arising by virtue of
this contract, other than claims, in stated amounts, that the Contractor
has specifically excepted from the operation of the release. A release
may also be required of any assignee if the Contractor\'s claim to
amounts payable under this contract has been assigned. The release forms
will be provided by BPA.

(End of clause)

######### Clause 22-3 BASIS OF PAYMENT \-- PROGRESS PAYMENTS (Sep 98)(BPI 22.1.3)

\(a\) Progress payments. BPA shall make progress payments as the work
proceeds based on the stage or percentage of work accomplished. The
Contractor shall furnish a breakdown of the work as a percentage of the
total contract price, in such detail as required by the CO.

\(b\) Title to all material and work covered by progress payments shall
pass to BPA at the time of payment. This shall not be construed as\--

\(1\) Relieving the Contractor from the sole responsibility for all work
upon which payments have been made or the restoration of any damaged
work; or

\(2\) Waiving the right of BPA to require the fulfillment of all of the
terms of the contract.

\(c\) Partial Payments. Unless otherwise specified, payment shall be
made after acceptance of any portion of the work delivered or rendered
for which a price is separately stated in the contract.

\(d\) Final Payment. BPA shall pay the amount due the Contractor under
this contract after completion and acceptance of all work and after
presentation of a release of all claims against BPA arising by virtue of
this contract, other than claims, in stated amounts, that the Contractor
has specifically excepted from the operation of the release. A release
may also be required of any assignee if the Contractor\'s claim to
amounts payable under this contract has been assigned.

(End of clause)

######### Clause 22-4 BASIS OF PAYMENT \-- TIME-AND-MATERIALS CONTRACTS (Sep 98)(BPI 22.1.3)

BPA shall pay the Contractor as follows after submission of invoices
approved by the CO. The Contractor shall be reimbursed for items and
services purchased directly for the contract only when cash, checks, or
other forms of actual payment have been made for such purchased items or
services.

\(a\) Hourly Rate.

\(1\) The amounts shall be computed by multiplying the appropriate
hourly rates prescribed in the Schedule by the number of direct labor
hours performed. The rates shall include wages, indirect costs, general
and administrative expense, and profit. Fractional parts of an hour
shall be payable on a prorated basis. The Contractor shall substantiate
invoices by evidence of actual payment and by individual daily job
timecards, or other substantiation approved by the CO.

\(2\) Overtime. The hourly rates shall not be varied by virtue of the
Contractor having performed work on an overtime basis unless the CO has
specifically authorized overtime and the contract includes overtime
rates.

\(b\) Materials. Allowable costs of direct materials shall be determined
by the CO in accordance with Part 13 of the BPI in effect on the date of
this contract. Reasonable and allocable material handling costs may be
included in the charge for material to the extent they are clearly
excluded from the hourly rate. Material handling costs are comprised of
indirect costs, including, when appropriate, general and administrative
expense allocated to direct materials in accordance with the
Contractor\'s usual accounting practices, consistent with Part 13 of the
BPI. Direct materials are those materials which enter directly into the
end product, or which are used or consumed directly in connection with
the furnishing of the end product.

\(c\) Travel Costs. Costs incurred for lodging, meals, and incidental
expenses shall be reimbursed on an actual cost basis to the extent that
they do not exceed on a daily basis the per diem rates in effect at the
time of travel as set forth in the Federal Travel Regulations,
prescribed by the General Services Administration, for travel in the
conterminous 48 United States. Airline costs will be reimbursed on an
actual cost basis to the extent determined reasonable and allocable
under Part 13 of the BPI. The CO must approve any variation from these
requirements. Contractors may request a letter from the Contracting
Officer authorizing access to lodging, or other rates negotiated for
government travel to the extent such authorization is honored by the
service providers.

\(d\) Subcontracts. The cost of subcontracts that are authorized under
the subcontracts clause of this contract shall be reimbursable costs
under this clause, if such costs are consistent with Part 13 of the BPI.
Reimbursable costs in connection with subcontracts shall be limited to
the amounts paid to the subcontractor. Reimbursable costs shall not
include any costs arising from the letting, administration or
supervision of performance of the subcontract, if the costs are included
in the hourly rates in the Schedule.

\(e\) Responsibility to obtain best overall price. To the extent able,
the Contractor shall\--

\(1\) Obtain materials, subcontracts, and travel at the most
advantageous prices available with due regard to securing prompt
delivery of satisfactory products and services; and

\(2\) Take all cash and trade discounts, rebates, allowances, credits,
salvage, commissions, and other benefits and additionally, give credit
to BPA for any amounts that have accrued to the benefit of the
Contractor or would have accrued except for the fault or neglect of the
contractor. When unable to take advantage of the benefits, the
Contractor shall promptly notify the CO and give the reasons.

\(f\) Material the Contractor regularly sells to the public. If the
nature of the work to be performed requires the Contractor to furnish
material which is regularly sold to the general public in the normal
course of business by the Contractor, the price to be paid for such
material, notwithstanding (e)(1) above, shall be on the basis of an
established catalog or list price, in effect when the material is
furnished, less all applicable discounts to BPA; provided, that in no
event shall such price be in excess of the Contractor\'s sales price to
its most favored customer for the same item in like quantity, or the
current market price, whichever is lower.

\(g\) Audit. At any time before final payment under this contract the CO
may audit the invoices and substantiating material. Each payment
previously made shall be subject to reduction to the extent of amounts,
on preceding invoices, that are found by the CO not to have been
properly payable and shall also be subject to reduction for overpayments
or to increase for underpayments. Upon receipt and approval of the
invoice designated by the Contractor as the \"final invoice\" and
substantiating material, and upon compliance by the Contractor with all
terms of this contract, BPA shall promptly pay any balance due the
Contractor.

\(h\) Refunds. The Contractor agrees that any refunds, rebates, or
credits (including any related interest) accruing to or received by the
Contractor or any assignee, that arise under the materials portion of
this contract and for which the Contractor has received reimbursement,
shall be paid by the Contractor to BPA. The Contractor and each assignee
shall assign to BPA all such refunds, rebates, or credits (including any
interest) in form and substance satisfactory to the CO.

(End of clause)

######### Clause 22-5 BASIS OF PAYMENT \-- COST REIMBURSEMENT (Feb 94)(BPI 22.1.3)

\(a\) Invoicing.

BPA shall make payments to the Contractor when requested as work
progresses in amounts determined to be allowable by the CO. The
Contractor shall substantiate invoices by evidence of actual payment and
in such form and reasonable detail as required by the CO.

\(b\) Reimbursing costs.

\(1\) Costs under this contract will be reimbursed in accordance with
BPI Part 13. For the purpose of reimbursing allowable costs (except with
respect to pension, deferred profit sharing, and employee stock
ownership plan contributions), the term \"costs\" includes only -

\(A\) Those recorded costs that, at the time of the request for
reimbursement, the Contractor has paid by cash, check, or other form of
actual payment for items or services purchased directly for the
contract;

\(B\) When the Contractor is not delinquent in paying costs of contract
performance in the ordinary course of business, costs incurred, but not
necessarily paid, for -

\(i\) Materials issued from the Contractor\'s inventory and placed in
the production process for use on the contract;

\(ii\) Direct labor;

\(iii\) Direct travel. Costs incurred for lodging, meals, and incidental
expenses shall be considered reasonable to the extent that they do not
exceed on a daily basis the per diem rates in effect at the time of
travel as set forth in the Federal Travel Regulations, prescribed by the
General Services Administration, for travel in the conterminous 48
United States. Airline costs will be reimbursed on an actual cost basis
to the extent determined reasonable and allocable under Part 13 of the
BPI. Any variation from these requirements must be approved by the CO.
Contractors may request a letter from the CO authorizing access to
airline, lodging, or other rates negotiated for government travel to the
extent such authorization is honored by the service providers;

\(iv\) Other direct in-house costs; and

\(v\) Properly allocable and allowable indirect costs, as shown in the
records maintained by the Contractor for purposes of obtaining
reimbursement under Government contracts.

\(C\) The amount of progress payments that have been paid to the
Contractor\'s subcontractors under similar cost standards.

\(2\) Contractor contributions to any pension, profit-sharing, or
employee stock ownership plan funds that are paid quarterly or more
often may be included in indirect costs for payment purposes; provided,
that the Contractor pays contributions to the fund within 30 days after
the close of the period covered. Payments made 30 days or more after the
close of the period shall not be included until the contractor actually
makes the payment. Accrued costs for such contributions that are paid
less often than quarterly shall be excluded from indirect costs for
payment purposes until the Contractor actually makes the payment.

\(3\) Any statements in specifications or other documents incorporated
in this contract by reference designating performance of services or
furnishing of materials at the Contractor\'s expense or at no cost to
BPA shall be disregarded for purposes of cost reimbursement under this
clause.

\(c\) Final indirect cost rates.

\(1\) Final annual indirect cost rates and the appropriate bases shall
be established in accordance with BPI Part 13 in effect for the period
covered by the indirect cost rate proposal.

\(2\) The Contractor shall, within 90 days after the expiration of each
of its fiscal years, or by a later date approved by the CO, submit to
the audit activity responsible for negotiating its final indirect cost
rates, proposed final indirect cost rates for that period and supporting
cost data specifying the contract and/or subcontract to which the rates
apply. The proposed rates shall be based on the Contractor\'s actual
cost experience for that period. The appropriate BPA representative and
Contractor shall establish the final indirect cost rates as promptly as
practical after receipt of the Contractor\'s proposal.

\(3\) The Contractor and the appropriate BPA representative shall
execute a written agreement setting forth the final indirect cost rates.
The agreement shall not change any monetary ceiling, contract
obligation, or specific cost allowance or disallowance provided for in
this contract. The agreement is incorporated into this contract upon
execution.

\(4\) Failure by the parties to agree on a final annual indirect cost
rate shall be a dispute within the meaning of the Disputes clause.

\(d\) Billing rates.

Until final annual indirect cost rates are established for any period,
BPA shall reimburse the Contractor at billing rates established by the
CO or by an authorized representative (the cognizant auditor), subject
to adjustment when the final rates are established. These billing rates
-

\(1\) Shall be the anticipated final rates; and

\(2\) May be prospectively or retroactively revised by mutual agreement,
at either party\'s request, to prevent substantial overpayment or
underpayment.

\(e\) Quick-close-out procedures.

When the Contractor and CO agree, the quick-close-out procedures of BPI
subpart 14.17.5 shall be used.

\(f\) Audit.

At any time or times before final payment, the CO may have the
Contractor\'s invoices or statements of cost audited. Any payment may be
(1) reduced by amounts found by the CO not to constitute allowable costs
or (2) adjusted for prior overpayments or underpayments.

\(g\) Final payment.

\(1\) The Contractor shall submit an invoice marked \"Final Invoice\",
promptly upon completion of the work. Upon approval of that invoice, and
upon the Contractor\'s compliance with all terms of this contract, the
BPA shall promptly pay any balance of allowable costs and that part of
the fee (if any) not previously paid.

\(2\) The Contractor shall pay to BPA any refunds, rebates, credits, or
other amounts (including interest, if any) accruing to or received by
the Contractor or any assignee under this contract, to the extent that
those amounts are properly allocable to costs for which the Contractor
has been reimbursed by BPA. Reasonable expenses incurred by the
Contractor for securing refunds, rebates, credits, or other amounts
shall be allowable costs if approved by the CO. Before final payment
under this contract, the Contractor and each assignee whose assignment
is in effect at the time of final payment shall execute and deliver an
assignment to BPA of refunds, rebates, credits, or other amounts
(including interest, if any) properly allocable to costs for which the
Contractor has been reimbursed by BPA under this contract.

(End of clause)

######### Clause 22-6 PREDETERMINED FINAL INDIRECT COST RATES (Jul 94)(BPI 22.1.3)

\(a\) Notwithstanding the Basis of Payment \-- Cost Reimbursement clause
of this contract, the allowable indirect costs under this contract shall
be obtained by applying predetermined final indirect cost rates to bases
agreed upon by the parties, as specified below.

\(b\) Not later than 90 days after the expiration of the Contractor\'s
fiscal year, the Contractor shall submit to the cognizant CO and to the
cognizant Federal agency, proposed predetermined final indirect cost
rates and supporting cost data. The proposed rate shall be based on the
Contractor\'s actual cost experience during that fiscal year.
Negotiations of predetermined final indirect cost rates shall begin as
soon as practical after receipt of the Contractor\'s proposal.

\(c\) Allowability of costs and acceptability of cost allocation methods
shall be determined in accordance with the BPI Part 13 in effect on the
date of this contract.

\(d\) Predetermined rate agreements in effect on the date of this
contract shall be incorporated into the contract. The CO and Contractor
shall negotiate rates for subsequent periods and execute a written
indirect cost rate agreement setting forth the results. The indirect
cost rate agreement shall not change any monetary ceiling, contract
obligation, or specific cost allowance or disallowance provided for in
this contract. The agreement is incorporated into this contract upon
execution.

\(e\) Pending establishment of predetermined final indirect cost rates
for any fiscal year (or other period agreed to by the parties), the
Contractor shall be reimbursed either at the rates fixed for the
previous fiscal year (or other period) or at billing rates acceptable to
the CO, subject to appropriate adjustment when the final rates for that
period are established.

\(f\) If for any fiscal year the parties fail to agree to predetermined
final indirect cost rates, the allowable indirect costs shall be
obtained by applying final indirect cost rates established in accordance
with the Basis of Payment \-- Cost Reimbursement clause.

\(g\) Allowable indirect costs for the period from the beginning of
performance until the end of the Contractor\'s fiscal year shall be
obtained using the predetermined final indirect cost rates and the bases
shown in the Schedule.

(End of clause)

######### Clause 22-7 CONTRACT CEILING LIMITATION (Sep 98)(BPI 22.1.3)

\(a\) The Contractor agrees to use its best efforts to perform the work
specified in the Schedule and all obligations under this contract within
the contract ceiling. The contract ceiling includes all estimated costs
(both direct and indirect) and any fee allowance. If this is a
cost-sharing contract, the contract ceiling includes both BPA\'s and the
Contractor\'s share of the cost.

\(b\) Notification of CO. The Contractor shall notify the CO in writing
at the first indication that the total cost for the performance of this
contract, exclusive of any fee, will be either greater or substantially
less than had been previously estimated.

\(c\) Revised Estimate. As part of the notification, the Contractor
shall provide the CO a revised estimate of the total cost of performing
this contract.

\(d\) Contract Ceiling.

\(1\) BPA is not obligated to reimburse the Contractor for costs
incurred in excess of the contract ceiling specified in the Schedule or,
if this is a cost-sharing contract, the estimated cost to BPA specified
in the Schedule; and

\(2\) The Contractor is not obligated to continue performance under this
contract (including actions under the Termination clause of this
contract) or otherwise incur costs in excess of the contract ceiling
specified in the Schedule, until the CO notifies the Contractor in
writing that the contract ceiling has been increased.

\(e\) No notice, communication, or representation, or from any person
other than the CO, shall affect this contract\'s contract ceiling.

\(f\) If this contract is terminated or the contract ceiling is not
increased, BPA and the Contractor shall negotiate an equitable
distribution of all property produced or purchased under the contract,
based upon the share of costs incurred by each.

(End of clause)

######### Clause 22-8 ADVANCE PAYMENTS (Sep 98)(BPI 22.1.4.5)

\(a\) Requirements for payment. Advance payments will be made under this
contract by electronic funds transfer upon submission of invoices by the
Contractor, and approval by the CO. The contractor is authorized to
request BPA funds for contract performance in amounts needed to cover
its own disbursements of cash in the next 30 days. The Contractor shall
apply terms similar to this clause to any advance payments to
subcontractors.

\(b\) Use of funds. Advances may only be used to pay for properly
allocable, allowable, and reasonable costs for direct materials, direct
labor, and indirect costs. Advances for other items require approval in
writing by the CO.

\(c\) Repayment to BPA. Whenever requested by the CO, the Contractor
shall repay to BPA any part of unspent advance payments considered to
exceed the Contractor\'s current requirements.

\(d\) Maximum payment. When the sum of all unspent advance payments,
unpaid interest charges, and other payments exceed [ ]{.underline}
(insert percentage) percent of the contract price,

BPA shall withhold further payments to the Contractor. On completion or
termination of the contract, BPA shall deduct from the amount due to the
Contractor all unliquidated advance payments and any interest charges
payable. If previous payments to the Contractor exceed the amount due,
the excess amount shall be immediately repaid to BPA.

\(e\) Lien on property under contract.

\(1\) The Contractor will file a security interest in favor of BPA,
paramount to all other liens, upon purchase or acquisition of property
and/or materials for the performance of this contract and will
immediately deliver copies of the filings to the CO.

\(2\) The Contractor will identify, by marking or segregation, all
property that is subject to a lien in favor of BPA. If, for any reason,
the supplies, materials, or other property are not identified by marking
or segregating, BPA shall be considered to have a lien to the extent of
BPA\'s interest under this contract on any mass of property with which
the supplies, materials, or other property are commingled.

\(f\) Insurance - Supply Contracts. The Contractor shall demonstrate
that it maintains with responsible insurance carriers adequate insurance
on plant and equipment against fire and other hazards. Contractor agrees
that, until work under this contract has been completed and all advance
payments made under the contract have been liquidated, it will maintain
this insurance. Contractor shall maintain adequate insurance on any
materials, parts, assemblies, subassemblies, supplies, equipment, and
other property acquired for or allocable to this contract and subject to
BPA lien under paragraph (i) of this clause.

\(g\) Termination of advance payments. The CO may, by written notice to
the contractor, withhold further advance payments on this contract at
any time the CO determines the Contractor is not adequately performing.

\(h\) Access to records. The Contractor shall provide the authorized BPA
representatives proper facilities for inspection of the Contractor\'s
books, records, and accounts.

\(i\) Restrictions on Novation. While any advance payments made under
this contract remain outstanding, the Contractor shall not substantially
change the management, ownership, or control of the corporation without
the prior written consent of the CO.

\(j\) Prohibition against assignment. The Contractor shall not assign
this contract, any interest therein, or any claim under the contract to
any party.

\(k\) Interest Required. The Contractor shall pay interest to BPA on
advance payments received by the Contractor in excess of the
Contractor\'s current needs. The interest will be paid at the higher of
Department of Treasury\'s current value of funds rate or the BPA cost of
money rate. Interest charges shall be deducted from payments, other than
advance payments, due the Contractor.

\(l\) Interest Charged to Subcontractors. The Contractor shall charge
interest on advance payments to subcontractors and credit the interest
to BPA. Interest need not be charged on advance payments to nonprofit
educational or research subcontractors for experimental, developmental
or research work.

(End of clause)

######### ALTERNATE I (Sep 98)

\(a\) Requirements for payment. Advance payments will be made under this
contract by electronic funds transfer within 5 working days after BPA
receipt of a request. The contractor is authorized to request BPA funds
for contract performance in amounts needed to cover its own
disbursements of cash for periods of less than 30 calendar days. The
Contractor shall report cash disbursements and balances as required by
the BPA billing office. The Contractor shall apply terms similar to this
clause to any advance payments to subcontractors.

(End of Alternate I)

######### ALTERNATE II: (Sep 98)

\(a\) Requirements for payment. Advance payments will be made under this
contract by electronic funds transfer within 5 working days after BPA
receipt of a request. The contractor is authorized to request BPA funds
for contract performance in amounts needed to cover its own
disbursements of cash for periods of less than 30 calendar days. The
Contractor shall report cash disbursements and balances as required by
the BPA billing office. The Contractor shall apply terms similar to this
clause to any advance payments to subcontractors.

\(k\) No interest shall be charged to the Contractor for advance
payments except for interest charged during a period of default.

(End of Alternate II)

######### ALTERNATE III: (Oct 93)

\(k\) No interest shall be charged to the Contractor for advance
payments except for interest charged during a period of default.

(End of Alternate III)

######### Clause 22-9 WITHHOLDING (Sep 98)(BPI 22.1.5.1)

\(a\) The CO reserves the right to withhold an amount not to exceed
\_\_\_\_ percent of the contract price if determined necessary to
protect BPA\'s interests.

\(b\) Upon completion and acceptance of each severable item of work for
which the price is stated separately in the contract, payment shall be
made for the completed work, less liquidated damages (if any), without
withholding of a percentage.

######### Alternate I (Mar 95)

\(c\) In the event this contract requires a specific written warranty,
equipment operating instructions, owners manual, or other documentation
the CO may process an interim payment for completed work, retaining a
maximum of \_\_\_\_\_ percent of the contract amount until such
documentation that is in compliance with the contract is received by the
CO. If a manufacturers\' inspection is required, the interim payment
shall not be made until the manufacturer certifies that the work was
accomplished to their satisfaction and in accordance with contract
requirements. Upon determination of acceptability of all required
documentation, payment of the amount withheld will be made without
further invoicing from the contractor.

(End of Alternate I)

######### Clause 22-10 DISCOUNTS FOR PROMPT PAYMENT (Sep 98)(BPI 22.2.5)

In connection with any discount offered for prompt payment, time shall
be computed from the date shown on the invoice or if no date is shown
then from the date BPA receives the invoice.

For the purpose of computing the discount earned, payment shall be
considered to have been made on the date which appears on the payment
check or the date on which an electronic funds transfer was made.

(End of clause)

######### Clause 22-11 PAYMENT \-- CONSTRUCTION CONTRACTS (Oct 05)(BPI 22.2.5)

\(a\) Prompt Payment Act. This contract is subject to the provisions of
the Prompt Payment Act (31 U.S.C. 3901 et seq.) and the regulations at 5
CFR Part 1315. All payments will be made in accordance with the
regulations at 5 CFR Part 13154.

\(b\) Payment Due Dates: For purposes of determining interest penalty
only, work will be deemed accepted not later than 30 calendar days after
the contractor has completed the work or services. According to the
Prompt Payment Act, a proper invoice to a Federal Agency must include
bank account information requisite to enable Electronic Funds Transfer
(EFT) as the method of payment.

\(1\) Progress payments shall be due not later than fourteen (14)
calendar days after receipt of the payment request by the BPA designated
billing office. BPA shall make progress payments monthly as the work
proceeds, or at more frequent intervals as may be agreed to by the CO,
on estimates of work accomplished which meets the standards of quality
established under the contract.

\(2\) Payment of any withholding shall be due not later than 30 days
after approval for release to the Contractor by the CO.

\(3\) Partial payments and final payments shall be due not later than
thirty (30) calendar days after the later of the date on which BPA
actually receives a proper invoice or the date of BPA acceptance of the
work or services completed by the Contractor.

\(c\) Billing Instructions.

\(1\) Invoices must include the contractor\'s name and address, invoice
date, contract number, task order number (if applicable), contract line
item number, description of products delivered or work performed, price
and quantity of item(s) actually delivered or rendered (amounts billed
for work performed under a task order must be separately identified by
task order number), and the name and address of the person to whom
payment will be made, and name (where practicable), title, phone number,
mailing address of person to be notified in event of a defective invoice
and bank account information requisite to enable Electronic Funds
Transfer (EFT) as method of payment (Invoices will not require banking
information if the contractor has that information on file at BPA).
Failure to submit a proper invoice may result in a delay in payment
including a rejection of invoice pending receipt of a properly amended
invoice.

\(2\) Contractors may bill monthly, or at more frequent intervals as may
be agreed to by the CO.

\(d\) Payment Method. Payments under this contract will be made by
electronic funds transfer whenever possible, or by check in very limited
circumstances, at the option of BPA.

\(e\) Interest Penalty Payments. If interest penalty payments are
determined due under the provisions of the Prompt Payment Act, payment
shall be made at the rates determined by the U.S. Treasury Section 12 of
the Contract Disputes Act of 1978 (41 U.S.C. 611).

\(f\) Subcontract Requirements.

\(1\) The Contractor shall include in each subcontract:

\(A\) A payment clause which obligates the Contractor to pay the
subcontractor for satisfactory performance under its subcontract not
later than 7 days from receipt of payment by BPA under this contract.

\(B\) An interest penalty clause which obligates the Contractor to pay
to the subcontractor an interest penalty for each payment not made in
accordance with the payment clause.

\(C\) A clause requiring each subcontractor to include a payment clause
and an interest penalty clause in each of its subcontracts, and to
require each of its subcontractors to include such clauses in their
subcontracts with each lower-tier subcontractor or supplier.

\(2\) If a Contractor, after making a request for payment to BPA,
discovers that all or a portion of the payment otherwise due a
subcontractor is subject to withholding from the subcontractor in
accordance with the subcontract agreement, then the Contractor shall\--

\(A\) Furnish a notice to the subcontractor specifying (1) the amount to
be withheld; (2) the specific cause for the withholding; and (3) the
remedial actions to be taken by the subcontractor in order to receive
payment of the amount withheld;

\(B\) Give the CO a copy of the notice furnished to the subcontractor;

\(C\) Notify the CO of the beginning and end dates of any withholding of
subcontractor payments; and

\(D\) Pay the subcontractor as soon as practicable after the correction
of the identified subcontract performance deficiency.

\(E\) Pay interest to BPA from the 8th day funds are held by the
Contractor to the date the funds are either paid to the subcontractor or
are returned to BPA.

\(3\) The Contractor may not request payment from BPA of any amount
withheld or retained from a subcontractor until such time as the
Contractor has determined the subcontractor is entitled to the payment
of such amount.

(End of clause)

######### Clause 22-12 PAYMENT (Oct 05)(BPI 22.2.5) 

\(a\) Payment Due Date. Payment (including partial payments or progress
payments, if authorized, shall be due not later than thirty (30)
calendar days after the later of the date on which BPA actually receives
a proper invoice in the designated billing office or the date when the
items delivered or completed services are accepted by BPA. According to
the Prompt Payment Act, a proper invoice to a Federal Agency is to
include bank account information requisite to enable Electronic Funds
Transfer (EFT) as method of payment. For purposes of payment only, items
will be deemed accepted not later than seven (7) working days after
proper delivery. If delivered items or completed services are found
defective, the provisions of this paragraph will be reapplied upon
receipt of a corrected item or service.

\(b\) Billing Instructions.

\(1\) Invoices must include the contractor\'s name and address, invoice
date, contract number, task order number (if applicable), contract line
item number, description of products delivered or work performed, price
and quantity of item(s) actually delivered or rendered (amounts billed
for work performed under a task order must be separately identified by
task order number), and the name and address of the person to whom
payment will be made, and name (where practicable), title, phone number,
mailing address of person to be notified in event of a defective invoice
and bank account information requisite t enable Electronic Funds
Transfer (EFT) as method of payment (Invoices will not require banking
information if the contractor has that information on file at BPA).
Failure to submit a proper invoice may result in a delay in payment
including a rejection of invoice pending receipt of a properly amended
invoice.

\(2\) Contractors may bill monthly, or at more frequent intervals as may
be agreed to by the CO.

\(c\) Payment Method. Payments under this contract will be made by
electronic funds transfer whenever possible, or by check in very limited
circumstances, at the option of BPA.

\(d\) Prompt Payment Act. This contract is subject to the provisions of
the Prompt Payment Act (31 U.S.C. 3901 et seq.), and regulations at 5
CFR Part 1315.

\(e\) Interest Penalty Payments. If interest penalty payments are
determined due under the provisions of the Prompt Payment Act, payment
shall be made at the rates determined by the U.S. Treasury Section 12 of
the Contract Disputes Act of 1978 (41 U.S.C. 611).

(End of clause)

######### Clause 22-13 INTEREST ON AMOUNTS DUE BPA (Sep 98)(BPI 22.3.1)

\(a\) Notwithstanding any other clause of this contract, all amounts
that become payable by the Contractor to BPA under this contract (net of
any applicable tax credit under the Internal Revenue Code (26 U.S.C.
l48l)) shall bear simple interest from the date due until paid unless
paid within 30 days of becoming due. The interest rate shall be the
interest rate established by the Secretary of the Treasury as provided
in Section l2 of the Contract Disputes Act of l978 (Public Law 95-563),
which is applicable to the period in which the amount becomes due, as
provided in paragraph (b) of this clause, and then at the rate
applicable for each six-month period as fixed by the Secretary until the
amount is paid.

\(b\) Amounts shall be due at the earliest of the following dates:

\(1\) The date fixed under this contract;

\(2\) The date of the first written demand for payment consistent with
this contract, including any demand resulting from a default
termination;

\(3\) The date BPA transmits to the Contractor a proposed supplemental
agreement to confirm completed negotiations establishing the amount of
debt; and

\(4\) If this contract provides for revision of prices, the date of
written notice to the Contractor stating the amount of refund payable in
connection with a pricing proposal or a negotiated pricing agreement not
confirmed by contract modification;

\(c\) Payment will be due within 30 days of the date of the invoice. The
collection actions available under the Debt Collection Act of 1982
(Public Law 97-365), as amended, and the revised Federal Claims
Collections Standards (4 CFR 102), will be utilized. Administrative
charges and penalties will be charged in accordance with 31 USC 3717,
except where prohibited or explicitly provided for by statute or
regulation required by statute.

(End of clause)

######### Clause 22-14 TAXES \-- INDEFINITE DELIVERY CONTRACTS (Sep 98)(BPI 22.5.3.4)

The contract price excludes all State and local taxes levied on or
measured by the contract or sales price of the services or completed
supplies furnished under this contract. The Contractor shall state
separately on its invoices taxes excluded from the contract price, and
BPA agrees either to pay the amount of the taxes to the Contractor or
provide evidence necessary to sustain an exemption.

(End of clause)

######### Clause 22-15 FEDERAL, STATE AND LOCAL TAXES (Sep 98)(BPI 22.5.3.4)

\(a\) The contract price shall include all applicable Federal, State,
and local taxes and duties.

\(b\) The contract price shall be increased by the amount of any
after-imposed Federal excise tax or duty, provided the Contractor
warrants in writing that no amount for such newly imposed Federal excise
tax or duty or rate increase was included in the contract price.

\(c\) The contract price shall be decreased by the amount of any
after-relieved Federal excise tax or duty.

\(d\) The contract price shall be decreased by the amount of any Federal
excise tax or duty, except social security or other employment taxes,
that the Contractor is required to pay or bear, or does not obtain a
refund of, through the Contractor\'s fault, negligence, or failure to
follow instructions of the Contracting Officer.

\(e\) No adjustment shall be made in the contract price under this
clause unless the amount of the adjustment exceeds \$250.

\(f\) Notwithstanding any of the above provisions for adjustment of the
contract price in the event of a change in a Federal excise tax or duty
after the contract date, no increase in the contract price shall be made
for any duty imposed under the Tariff Act of 1930, as amended, (19
U.S.C. 1303) or the Anti-dumping Act of 1921, as amended (19 U.S.C.
160-171).

(End of clause)

######### Clause 22-16 TAXES AND DUTIES (Sep 98)(BPI 22.5.3.4)

The contract price shall include all applicable Federal, State, and
local taxes and duties.

(End of clause)

######### Clause 22-17 WASHINGTON STATE SALES AND USE TAXES (Sep 98)(BPI 22.5.3.4)

\(a\) The Supreme Court has ruled that the Washington State Sales and
Use Taxes apply to Federal contracts. Therefore, it is the
responsibility of the offerors to take Washington State Tax Statutes
into account when preparing their offers.

\(b\) Offerors should not take into account or include a factor for the
State of Washington Sales or Use Tax which may be levied on
Government-furnished materials or equipment in connection with
performance of this contract. Any assessment by the State of Washington
against the contractor shall be reported immediately to the CO. The
contractor shall be reimbursed by BPA for payment of any tax authorized
to be paid by the CO by an appropriate contract modification. The
reimbursement shall be limited to the actual tax amount assessed by the
State of Washington. The contractor hereby authorizes BPA to enter into
such negotiations and arrangements with the State of Washington as it
may deem appropriate in resolving the amount of applicable tax(es).

(End of clause)

######### Clause 22-18 STATE OF IDAHO USE TAX (Sep 98)(BPI 22.5.3.4)

The State of Idaho may endeavor to impose a use tax on the value of
Government-furnished materials on this contract. Offerors should not
include in their offers any factor for this tax. In the event the State
of Idaho purports to assess or levy such a tax, the Contractor shall
immediately submit copies of any documents reflecting such assessment or
levy to the CO. Any inquiries from the State of Idaho relating to the
value of equipment or materials furnished by BPA shall be referred to
the CO. The Contractor shall not make any payments to the State of Idaho
on account of such taxes unless authorized by the CO.

(End of clause)

######### Clause 22-19 INDIRECT COST RATES WITH CARRY-FORWARD (Jul 94)(BPI 22.1.3)

Notwithstanding OMB Circular A-87, the indirect cost rate for this
contract will be established based on the estimate of a future period's
cost and is not subject to revision. However, differences between the
estimated costs and actual costs when they become known are carried
forward and are considered in the negotiation of rates for subsequent
periods. If actual indirect costs are more than estimated, the amount of
the increase is added to the estimate for the next period to determine
the fixed rate for the next period. Conversely, if actual indirect costs
are less than estimated, the difference between the fixed rate and the
actual cost is subtracted from the estimate of the next period to
determine the fixed rate for the next period.

(End of clause)

######### Clause 22-20 ELECTRONIC FUNDS TRANSFER PAYMENT (Oct 07)(BPI 22.6.2)

\(a\) [Payment Method.]{.underline} Payments under this contract,
including invoice and contract financing payments, will be made by
electronic funds transfer (EFT). Contractors are required to provide its
taxpayer identification number (TIN) and other necessary banking
information as per paragraph (c) of this clause to receive EFT payment.

\(b\) [Contractor EFT arrangement with a financial institution or
authorized payment agent.]{.underline} The Contractor shall designate to
BPA, as per paragraph (c) of this clause, and maintain at its own
expense, a single financial institution or authorized payment agent
capable of receiving and processing EFT using the Automated Clearing
House (ACH) transfer method. The most current designation and EFT
information will be used for all payments under all BPA contracts,
unless the BPA Vendor File Maintenance Team is notified of a change as
per paragraph (d) of this clause. An initial designation should be
submitted after award, but no later than three weeks before an invoice
or contract financing request is submitted for payment.

\(c\) [Submission of EFT banking information to BPA.]{.underline} The
Contractor shall submit EFT enrollment banking information directly to
BPA Vendor File Maintenance Team, using Substitute IRS Form w9e, Request
for Taxpayer Identification Number and Certification. This form is
available either from the Contracting Officer (CO) or from the Vendor
File Maintenance Team. Submit completed enrollment form to the Vendor
Team. Contact and mailing information:

> Bonneville Power Administration
>
> PO Box 491
>
> ATTN: NSTS - MODW Vendor Maint.
>
> Vancouver, WA 98666-0491
>
> E-mail Address: VendorMaintenance@BPA.gov
>
> Phone: (360) 418-2800
>
> Fax: (360) 418-8904

\(d\) [Change in EFT information.]{.underline} In the event that EFT
information changes or the Contractor elects to designate a different
financial institution for the receipt of any payment made using EFT
procedures, the Contractor shall be responsible for providing the
changed information to the BPA Vendor File Maintenance Team office. The
Vendor File Maintenance Team must be notified 30 days prior to the date
such change is to become effective.

\(e\) [Suspension of Payment.]{.underline} BPA is not required to make
any payment under this contract until receipt of the correct EFT payment
information from the Contractor.

\(f\) [EFT and prompt payment.]{.underline} BPA shall pay no penalty on
delay of payment resulting from defective EFT information. BPA will
notify the Contractor within 7 days of its receipt of EFT information
which it determines to be defective.

\(g\) [EFT and assignment of claims.]{.underline} If the Contractor
assigns the proceeds of this contract as provided for in the Assignment
of Claims clause of this contract, the assignee shall provide the
assignee's EFT information required by paragraph (c) of this clause.

(End of clause)

######### Clause 22-21 ELECTRONIC RECEIPT SETTLEMENT (ERS) PAYMENT (Sep 01)(BPI 22.7)

\(a\) Payments under this contract shall be by the Electronic Receipt
Settlement (ERS) method. THE CONTRACTOR WILL NOT SEPARATELY INVOICE FOR
ITEMS DELIVERED. Upon receipt or delivery of an authorized order and
verification that the delivery complies with all ordering requirements,
the payment will be scheduled for disbursement according to the terms of
the contract. A numbered packing list must accompany all shipments. The
packing list must include Contractor's name, address, PO number and/or
Release number, line item number and quantity shipped.

\(b\) For any orders shipped FREIGHT CHARGED, the Contractor must
invoice directly per clause 22-12, Payment.

\(c\) BPA will compute discounts for prompt payment as defined in clause
22-10, Discount for Prompt Payment.

\(d\) Payments will be scheduled according to the provisions of the
Prompt Payment Act, as defined in clause 22-12, Payment.

\(e\) Payments will be completed by electronic funds transfer (EFT)
whenever possible. Contractors must provide information as stated in
Clause 22-20, Electronic Funds Transfer.

(End of clause)