Subpart 37.3 - Dismantling, Demolition, or

Removal of Improvements

Parent topic: Part 37 - Service Contracting

37.300 Scope of subpart.

This subpart prescribes procedures for contracting for dismantling or demolition of buildings,

ground improvements and other real property structures and for the removal of such structures or

portions of them (hereafter referred to as "dismantling, demolition, or removal of improvements").

37.301 Labor standards.

Contracts for dismantling, demolition, or removal of improvements are subject to either 41

U.S.C.chapter 67, Service Contract Labor Standards, or 40 U.S.C.chapter 31, subchapter IV, Wage

Rate Requirements (Construction). If the contract is solely for dismantling, demolition, or removal of

improvements, the Service Contract Labor Standards statute applies unless further work which will

result in the construction, alteration, or repair of a public building or public work at that location is

contemplated. If such further construction work is intended, even though by separate contract, then

the Construction Wage Rate Requirements statute applies to the contract for dismantling,

demolition, or removal.

37.302 Bonds or other security.

When a contract is solely for dismantling, demolition, or removal of improvements,40 U.S.C.chapter

31, subchapter III, Bonds, (see 28.102) does not apply. However, the contracting officer may require

the contractor to furnish a performance bond or other security (see 28.103) in an amount that the

contracting officer considers adequate to-

(a) Ensure completion of the work;

(b) Protect property to be retained by the Government;

(c) Protect property to be provided as compensation to the contractor; and

(d) Protect the Government against damage to adjoining property.

37.303 Payments.

(a) The contract may provide that the-

(1) Government pay the contractor for the dismantling or demolition of structures; or
(2) Contractor pay the Government for the right to salvage and remove the materials resulting from

the dismantling or demolition operation.

(b) The contracting officer shall consider the usefulness to the Government of all salvageable

property. Any of the property that is more useful to the Government than its value as salvage to the

contractor should be expressly designated in the contract for retention by the Government. The

contracting officer shall determine the fair market value of any property not so designated, since the

contractor will get title to this property, and its value will therefore be important in determining

what payment, if any, shall be made to the contractor and whether additional compensation will be

made if the contract is terminated.

37.304 Contract clauses.

(a) The contracting officer shall insert the clause at 52.237-4, Payment by Government to

Contractor, in solicitations and contracts solely for dismantling, demolition, or removal of

improvements whenever the contracting officer determines that the Government shall make

payment to the contractor in addition to any title to property that the contractor may receive under

the contract. If the contracting officer determines that all material resulting from the dismantling or

demolition work is to be retained by the Government, use the basic clause with its AlternateI.

(b) The contracting officer shall insert the clause at 52.237-5, Payment by Contractor to Government

in solicitations and contracts for dismantling, demolition, or removal of improvements whenever the

contractor is to receive title to dismantled or demolished property and a net amount of compensation

is due to the Government, except if the contracting officer determines that it would be advantageous

to the Government for the contractor to pay in increments and the Government to transfer title to

the contractor for increments of property only upon receipt of those payments.

(c) The contracting officer shall insert the clause at 52.237-6, Incremental Payment by Contractor to

Government, in solicitations and contracts for dismantling, demolition, or removal of improvements

if (l) the contractor is to receive title to dismantled or demolished property and a net amount of

compensation is due the Government, and (2) the contracting officer determines that it would be

advantageous to the Government for the contractor to pay in increments, and for the Government to

transfer title to the contractor for increments of property only upon receipt of those payments. This

determination may be appropriate, for example, if it encourages greater competition or participation

of small business concerns.