[Federal Register Volume 65, Number 247 (Friday, December 22, 2000)]
[Rules and Regulations]
[Pages 80994-81079]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-31542]
[[Page 80993]]
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Part II
Department of Energy
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48 CFR Chapter 9
Department of Energy Acquisition Regulation; Rewrite of Regulations
Governing Management and Operating Contracts; Final Rule
Federal Register / Vol. 65, No. 247 / Friday, December 22, 2000 /
Rules and Regulations
[[Page 80994]]
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DEPARTMENT OF ENERGY
48 CFR Chapter 9
RIN 1991-AB46; RIN 1991-AB49
Department of Energy Acquisition Regulation; Rewrite of
Regulations Governing Management and Operating Contracts
AGENCY: Department of Energy.
ACTION: Final rule.
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SUMMARY: The Department of Energy (DOE) amends its Acquisition
Regulation to streamline the policies, procedures, provisions and
clauses that are applicable to its management and operating contracts.
This rulemaking eliminates coverage that is obsolete or that duplicates
the Federal Acquisition Regulation (FAR), and retains only coverage
that either implements or supplements the FAR for the award and
administration of the Department's management and operating contracts.
The rule also adds five new clauses and amends several existing clauses
to promote uniform application of the Department's award and
administration policies for management and operating contracts. Also,
this final rule amends the Department's Acquisition Regulation
regarding management and operating contract cost principles by adopting
the Federal Acquisition Regulation cost principles, with some
supplemental material. Finally, the Department is making technical and
administrative changes.
EFFECTIVE DATE: This final rule is effective January 22, 2001.
FOR FURTHER INFORMATION CONTACT: Michael L. Righi, Office of Policy
(MA-51), Department of Energy, 1000 Independence Avenue, SW.,
Washington, D.C. 20585; 202-586-8175 (phone); 202-586-0545 (facsimile);
or [email protected] (Internet).
SUPPLEMENTARY INFORMATION:
I. Background
II. Discussion of Public Comments
III. Procedural Requirements
A. Review of Executive Order 12866
B. Review Under Executive Order 12988
C. Review Under the Regulatory Flexibility Act
D. Review Under the Paperwork Reduction Act
E. Review Under Executive Order 13132
F. Review Under the National Environmental Policy Act
G. Unfunded Mandates Reform Act of 1995
H. Review Under Small Business Regulatory Enforcement Fairness
Act of 1996
I. Background
On March 13, 2000, the Department of Energy (DOE or Department)
published in the Federal Register (65 FR 13418) a Notice of Proposed
Rulemaking to amend the Department of Energy Acquisition Regulation
(DEAR) to streamline the policies, procedures, provisions and clauses
that are applicable to its management and operating contracts. This
Rulemaking was titled ``Rewrite of Regulations Governing Management and
Operating Contracts.'' On June 14, 2000, DOE published in the Federal
Register (65 FR 37335) a related Notice of Proposed Rulemaking to amend
the DEAR to delete those cost principles and related provisions of the
DEAR that are applicable to its management and operating contracts that
are adequately covered by the Federal Acquisition Regulation (FAR).
This Rulemaking was titled ``Changes to Department of Energy Cost
Principles and Various Clauses.'' Today, DOE publishes a final rule
based on these Notices of Proposed Rulemaking.
This rule rewrites DEAR Part 970, in its entirety, to streamline
the policies, procedures, provisions and clauses that are applicable to
the Department's management and operating (M&O) contracts. The rule
eliminates coverage that is obsolete or that unnecessarily duplicates
coverage contained in the FAR. The rule also updates and revises
prescriptions and text of certain clauses to provide greater
flexibility for DOE contracting personnel to make administrative
modifications to the text of these clauses and to eliminate the need
for commonly used deviations to such clauses. Five new clauses are
included in the DEAR. The new clauses prescribe uniform Departmental
policies concerning: (1) Cooperation between the Department and its
contractors in disseminating information to the public; (2) technical
direction provided to contractors by a designated contracting officer's
representative; (3) collaboration to identify, evaluate, and
institutionalize processes that will improve the effectiveness or
efficiency of any aspect of contract performance, and collaboration
regarding such improvements between the Department and other major site
and facility management contractors; (4) implementation of FAR 35.017
regarding the establishment, use, review, and termination of Federally
Funded Research and Development Centers which are sponsored by the
Department; and (5) outreach to the local communities in which DOE
conducts business.
Additionally, Part 970 is reorganized and renumbered so that the
coverage corresponds, to the extent practicable, with the FAR part,
subpart, section, and subsection(s) being implemented or supplemented,
as appropriate, in Part 970. Accordingly, technical and conforming
amendments to DEAR part 970 and other DEAR parts are made. Among the
renumbered provisions are the Financial Management clauses for
management and operating contracts, which were published as a final
rulemaking in the Federal Register (65 FR 21371) on April 21, 2000.
In preparing this Notice of Final Rulemaking, the Department has
made a variety of technical changes, which, with one exception, do not
warrant extended discussion. That exception is the coverage for
Contractor Employee Travel Discounts, found at 48 CFR 951.7002 and 48
CFR 952.251-70, which has been updated to conform to mandatory GSA
travel policy.
Contracting officers must apply these DEAR changes to solicitations
issued on or after the effective date of this rule.
Contracting officers may, at their discretion, include these DEAR
changes in solicitations issued before the effective date of this rule,
provided award of the resulting contract(s) occurs on or after the
effective date.
Contracting officers must apply these DEAR changes: to contracts
extended in accordance with the Department's extend/compete policies
and procedures (48 CFR 917.6, 48 CFR 970.1702-1(a), and internal
guidance); and to options exercised under competitively awarded
management and operating contracts (48 CFR 970.1702-1(b)).
Contracting officers may, after consulting with the Department of
Energy Office of Procurement and Assistance Policy of the Office of
Procurement and Assistance Management, apply these DEAR changes, with
the exception of the changes to the cost principles and related
clauses, to existing contracts.
Contracting officers should modify existing contracts to
incorporate the following clauses within one year of the effective date
of this rule: 952.204-75, Public Affairs; 952.215-70, Key Personnel;
970.5203-2, Performance Improvement and Collaboration; 970.5203-3,
Contractor's Organization; 970.5226-3, Community Commitment; and
970.5235-1, Federally funded Research and Development Center Sponsoring
Agreement.
II. Discussion of Public Comments
The major issues emerging from the public comments on the two
proposed rules that led to this final rule (the ``Rewrite of
Regulations Governing Management and Operating Contracts'' and the
``Changes to Department of Energy Cost Principles and Various
[[Page 80995]]
Clauses'') are discussed separately below. DOE received other comments
that were out of scope, speculative, or otherwise irrelevant.
Consistent with applicable law, DOE is not responding to those
comments.
Rewrite of Regulations Governing Management and Operating Contracts
Fourteen respondents submitted 43 comments covering 22 separate
topics. However, some of these comments raised issues not listed as
open for comment in the proposed rule. The Department is separately
evaluating these comments for potential rulemaking actions in the
future.
952.204-75 Public Affairs
Comment: Four respondents expressed dissatisfaction with proposed
Public Affairs clause asserting its requirements were, among other
things, unproductive, burdensome, ambiguous, and unworkable.
Response: To permit appropriate procedures at each activity that
will maximize the effectiveness of the clause and minimize the burden
on the Departments' contractors, the Department has added the following
language to paragraphs (a), (e), and (f) of the clause: ``in accordance
with procedures defined by the Contracting Officer.''
952.215-70 Key Personnel
Comment: Two respondents recommended DOE not require the contractor
to obtain DOE's approval before moving key personnel.
Response: While the Department deems it essential that it retain
the right to approve movements of key personnel in most cases, it has
amended paragraph (a) of the clause by adding language to permit a
contractor to move key personnel if the contractor deems immediate
removal or suspension of any member of its management team necessary to
fulfill its obligation to maintain satisfactory standards of employee
competency, conduct, and integrity under the clause at 48 CFR 970.5203-
3, Contractor's Organization. The Contractor must notify the
contracting officer prior to or concurrently with such action.
952.242-70 Technical Direction
Comment: Two respondents expressed dissatisfaction with the
clause's asserted lack of congruence with contracts for basic research.
Response: The use of the clause is discretionary. Nevertheless, the
Department has added to the clause prescription at 48 CFR 942.270-2
authorization to use a clause ``substantially the same as'' the
standard clause. Additionally, the Department has added to the clause
at 48 CFR 952.242-70 a new paragraph (e)(3) that gives the contracting
officer another option in responding to the contractor's assertion of
changed conditions. This option permits the contracting officer to
advise the contractor in writing within a reasonable time not to
proceed with the instruction or direction of the contracting officer's
representative.
970.0370/970.5203-2 Performance Improvement and Collaboration
Comment: One respondent recommended: (1) deleting the first and
sixth sentences in paragraph (d) of 48 CFR 970.0370-1 because they were
redundant with other coverage; and, (2) in performance-based management
contracts, replacing the requirement in the first sentence of 48 CFR
970.5203-2(d) that the contractor obtain the contracting officer's
approval where necessary with a statement that the contract would
define the requirement for the clause per DOE policy. Another
respondent, while not objecting to the clause, urged that its use ``* *
* not lead to unnecessary implementation or oversight expenses for DOE
or its contractors.''
Response: Regarding the first respondent's recommendation, the
Department does not agree that the first and sixth sentences in
paragraph (d) of 48 CFR 970.0370-1 are redundant. They state the
Department's policy and expectations clearly. Nor does the Department
agree that the suggested replacement in 48 CFR 970.5203-2(d) adds
clarity; it would remove clear-cut direction regarding the contractor's
obligation to seek approval with a vague statement that requirements
would be defined later. Regarding the second respondent's
recommendation, the Department shares the respondent's hope that the
clause will be implemented prudently.
970.2673-2/970.5226-3 Community Commitment
Comment: Seven respondents submitted comments on the proposed
community commitment clause. The gist of the comments was that DOE was
inappropriately changing existing policy for economic development
initiatives for its major site and facility contracts. Some comments
were supportive of the proposed clause and suggested additional
language to expand or clarify the proposed language.
Response: The Department has decided not to adopt any of the
respondents' proposed changes, not because the Department disagrees in
principle with the changes, but because they are unnecessary. Some
elaboration is appropriate.
In the past, a number of DOE's competitive solicitations for major
site and facility contracts included requirements that competitors
propose specific economic development initiatives as a consideration in
source selection. This type of selection factor was primarily used in
association with sites and facilities that were undergoing major
changes, such as downsizing or closure, and where the Department
envisioned the contractor to have a major role in the change-over. In
certain cases the contractor's performance against the proposed
economic development initiatives became a contract requirement subject
to assessment in making fee determinations.
The use of economic development source selection factors was,
however, neither a requirement of law, such as Section 3161 of the
National Defense Authorization Act for Fiscal Year 1993, nor a part of
DOE's implementation of worker and community transition policies. The
use of economic development contractor selection factors was, in short,
not a Departmental policy, but rather an occasional practice related to
specific considerations at the site or facility. Although DOE included
source selection factors related to economic development in past
competitive solicitations, DOE does not currently have appropriate
applications for this practice. For the most part, our sites and
facilities are stable in the sense that we do not envision radical
mission changes or downsizing.
This does not mean that the Department has lost sight of the fact
that the Department and its contractors need to be good neighbors. To
reflect the Department's policy, we are issuing a contract clause that
will require each major site and facility contractor to conduct its
business activities at the DOE facility in a manner that: (1)
recognizes the diverse interests of the region and its stakeholders;
(2) engages regional stakeholders in issues and concerns of mutual
interest; and (3) recognizes that giving back to the community is a
worthwhile business practice. This requirement has also been included
in our most recent competitive contract awards. The use of such a
contractual requirement provides a viable mechanism to ensure that DOE
contractors are responsive to local interests.
The new clause does not preclude the Department from incorporating
specific requirements in its contracts where such requirements fulfill
or support DOE's
[[Page 80996]]
mission at the site or facility. For example, DOE's major site and
facility contracts will continue to require compliance with the
Department's Section 3161 program to minimize the impact of mission
changes on the contractor workforce and the affected community.
Additionally, DOE may pursue economic development activities directly
rather than through a contract mechanism. DOE will continue to assess
the need for these activities on a case-by-case basis where such
activities are in connection with the mission of the site or facility
and can be accomplished consistent with the provisions of various
appropriations laws and other regulations. However, DOE does not intend
to use economic development requirements in solicitations and contracts
where such requirements are unrelated to the specific mission at the
site or facility.
DOE has a long-standing commitment to the regions and local
communities in which it conducts business. The Department continues to
recognize that its success in meeting critical mission needs is
dependent on active support from state, regional and local governments,
communities, and other organizations. DOE has demonstrated that
commitment through outreach and partnering initiatives in a number of
ways including: hiring preferences and preservation of benefits to
employees of successor contractors; programs for ensuring worker safety
and health; aggressive subcontracting programs for small businesses,
small disadvantaged businesses, women-owned businesses, and HUB Zone
businesses; small business mentoring programs; release of assets no
longer needed by the Department to community reuse organizations;
support to local educational institutions; and technology transfer
programs.
The Department's commitment remains strong today, and it will
continue pursuing opportunities to ensure that the Department is a
productive and conscientious partner in the areas in which it conducts
business. The Department recognizes and accepts its obligation to the
people and communities surrounding DOE sites and facilities.
970.4501-1/970.5245-1 Government Property
Comment: One respondent suggested that DOE remove the definition of
``managerial personnel'' from the property clause, implying the
definition should be in the ``Definitions'' clause of the contract.
Response: The Department does not agree that the suggested change
would be an improvement. The current property clause defines managerial
personnel and other clauses use the definition by referencing it rather
than repeating it. This has been a Department-wide practice since the
implementation of contract reform. There would be no obvious benefit to
changing this successful practice.
970.5203-3 Contractor's Organization
Comment: Seven respondents provided comments whose gist was an
objection to the ``new'' right DOE is asserting to direct the removal
of contractor employees for specified causes. The respondents raised
numerous issues, such as legal complexities, recruiting difficulties,
labor-management concerns, and employer-employee relationship concerns.
Response: The Department does not agree that this proposed clause
is essentially a new right DOE is asserting. This right has always been
standard language in the DEAR. DOE is simply removing the alternate
language, which did permit contracting officers to not assert this
right. Additionally, the FAR (at 48 CFR 52.236-5, Material and
Workmanship) and case law have supported the Government's use of this
contractual authority. The unique nature of a management and operating
contracts makes it appropriate that the Government retain this right in
this type of contract.
Notwithstanding the above, the Department recognizes that
exercising this right is an action not to be taken lightly.
Consequently, the Department has amended the proposed language by
raising the approval authority for exercising this right to the
Secretary of Energy. Further, the Department plans to provide guidance
to its personnel to emphasize that they should only consider exercising
this right if the contractor fails to fulfill its obligation under this
clause to implement a process for maintaining satisfactory standards of
employee competency, conduct, and integrity.
In addition to the change above, the Department also added an
optional phrase to the clause's prescription (48 CFR 970.0371-9) that
the chart discussed in paragraph (a) of the clause also include
managerial personnel.
970.5235-1 Federally Funded Research and Development Center Sponsoring
Agreement
Comment: Two respondents suggested editorial changes and questioned
DOE's implementation of the FAR policy regarding Federally Funded
Research and Development Center (FFRDCs), alleging, for example, that
the FAR mandates ``long term relationships'' while DOE's proposed
language does not.
Response: The Department does not agree that its proposed language
is in any way inconsistent with the FAR policy on FFRDCs. The comments
infer meanings from the FAR language that are not warranted. Language
in the FAR does not mandate ``long term relationships'' between
agencies and FFRDCs, it simply encourages them. Current DOE policy
provides for a potential 10-year relationship.
970.5244-1 Contractor Purchasing System
Comment: Two respondents commented on DOE's alternatives of using
either the Contractor Purchasing System Review or the Balanced Score
Card methodology for periodic appraisals of the Contractor's management
of the purchasing function. One suggested choosing the alternative
prior to the evaluation period. The other questioned the reintroduction
of the formal Contractor Purchasing System Review as an alternative to
the Balanced Score Card methodology.
Response: The Department disagrees that the alternative must be
established prior to the evaluation period. The proposed clause
requires the Contractor Purchasing System Review unless the contractor
can obtain the contracting officer's approval to participate in the
Balanced Score Card methodology. The Department also disagrees that it
is ``reintroducing'' the formal Contractor Purchasing System Review.
The current DEAR clause states DOE reserves the right to review/approve
the contractor's purchasing system per FAR Subpart 44.3--the Contractor
Purchasing System Review.
52.211-5 Workmanship and Materials/Material Requirements
Comment: One respondent questioned DOE's intent in replacing the
DEAR Workmanship and Materials clause at 48 CFR 970.5204-25 with the
FAR Material Requirements clause at 48 CFR 52.211-5. The respondent
asserted that the clauses were dissimilar.
Response: In its review of DEAR Part 970, the Department determined
the requirements of the DEAR Workmanship and Materials clause were
mostly subjective. The requirements, to the extent necessary, are more
suitably enforced by other, less subjective parts of the contract such
as work authorization directives. The clause requirement that only new
materials be used is provided for in 48 CFR 52.211-5. The Department
had
[[Page 80997]]
added a clause prescription at 48 CFR 970.1103-4. Additionally, the
Department has added language to 48 CFR 970.0100 and 48 CFR 970.5200 to
emphasize that management and operating contracts, as specialized
government contracts, include both FAR and DEAR clauses.
52.236-8 Other Contracts
Comment: One respondent objected to DOE's adopting the standard FAR
clause (48 CFR 52.236-8), Other Contracts, because it conflicts with
DOE's current practice of holding a facility management contractor
accountable regardless of who performs the work. The respondent
recommended authorizing tailoring of the clause.
Response: The Department does not agree that there is a conflict or
that the clause should permit tailoring. It appears the respondent is
confusing two separate contractor responsibilities: one is managing its
subcontractors; the other is cooperating with other prime contractors
on site. DOE's current practice regarding a prime contractor managing
its subcontractors (specified in the clause at 48 CFR 970.5223-1,
Integration of Environment, Safety, and Health into Work Planning and
Execution) is to hold the contractor accountable regardless of who
performs the work. DOE's current practice regarding cooperation among
prime contractors is that the prime contractor must cooperate fully
with other prime contractors (which is no different than the proposed
practice required by the standard FAR clause). These two requirements
are independent of each other.
Changes to Department of Energy Cost Principles and Various Clauses
Five respondents submitted 34 comments covering 24 separate topics.
The ``Changes to Department of Energy Cost Principles and Various
Clauses'' proposed rule did not use the organization and numbering
system that this final rule institutes. This new organization and
numbering system, which was introduced in the ``Rewrite of Regulations
Governing Management and Operating Contracts'' proposed rule, is
reflected in the comprehensive conversion table for DEAR Part 970 that
follows this section. That conversion table compares new citations,
which appear in the final rule, to current citations.
To aid the reader in tracing from the ``Changes to Department of
Energy Cost Principles and Various Clauses'' proposed rule to this
final rule, the headings within the discussion of public comments
section that follows are listed both with the current citation, which
appeared in the proposed rule, and with the new (if there is one)
citation, which appears in this final rule. The new citation appears in
parentheses.
As an additional aid to the reader, the following mini-conversion
table compares current citations, which appeared in the proposed rule,
to new citations, which appear in this final rule, for the citations
that meet the following criteria: (1) They were affected by the
``Changes to Department of Energy Cost Principles and Various Clauses''
proposed rule and they appear in this final rule; or (2) they are new
citations and they appear in this final rule.
By using the following mini-conversion table and the comprehensive
conversion table for DEAR Part 970 that follows this section, the
reader should be able to follow the transition (from the current
citations to the new citations) easily.
------------------------------------------------------------------------
Current citation New citation Title
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970.3100-1.................... 970.3101-00-70... Scope of subpart.
970.3101-3.................... 970.3102-3-70.... Home Office Expenses.
970.3101-9.................... 970.3101-9....... Advance Agreements.
970.3101-10................... 970.3101-10...... Cost Certification.
970.3102...................... 970.3102-05...... Application of Cost
Principles.
970.3102-4.................... 970.3102-05-4.... Bonding Costs.
970.3102-6.................... 970.3102-05-6.... Compensation for
Personal Services.
970.3102-18................... 970.3102-05-18... Independent research
and development and
bid and proposal
costs.
970.3102-19................... 970.3102-05-19... Insurance and
indemnification.
970.3102-22................... 970.3102-05-22... Lobbying and
political activity
costs.
970.3102-28................... 970.3102-05-28... Other business
expenses.
970.3102-30................... 970-3102-05-30... Patent costs and
technology transfer
costs.
970.3102-46................... 970-3102-05-46... Travel Costs.
N/A........................... 970.3102-05-47... Costs Related to
Legal and Other
Proceedings.
970.3102-53................... 970.3102-05-53... Prexisiting
Conditions.
N/A........................... 970.3170......... Contract Clause.
970.42........................ 970.42........... Contract
Administration.
970.4207-1.................... 970.4207-05-01... Contracting officer
determination
procedure.
N/A........................... 970.4207-03-70... Contract clause.
970.4207-2.................... 970.4207-03-02... Certificate of Costs.
970.5204-16................... 970.5232-2....... Payments and
advances.
970.5204-31................... 970.5228-1....... Insurance-litigation
and claims.
970.5204-XX................... 970.5242-1....... 970.3102-53
------------------------------------------------------------------------
970.3101-1 (No New Citation) Objectives
Comment: One respondent commented that the proposed 48 CFR
970.3101-1 Objectives unnecessarily addresses deviations to the cost
principles, since deviations are addressed at 48 CFR 970.5202 and in
written Departmental procedures.
Response: The Department concurs and has deleted the coverage from
the final rule.
970.3101-3 (970.3102-3-70) Home Office Expenses
Comment: Two respondents commented that the proposed coverage at 48
CFR 970.3101-3, Home Office Expenses, appeared at odds with the policy
articulated at 48 CFR 970.15404-4-2(b)(1), Special Considerations:
Laboratory Management and Operation, which states in part that costs
incurred in the operation of a laboratory that are allowable and
allocable under the cost principles should be classified as direct or
indirect charges to the contract and not included as proposed fee.
[[Page 80998]]
Response: The proposed coverage and the policy are not at odds. The
proposed coverage requires the laboratory management contractor to
classify allowable costs under the cost principles and other
regulations as charges to the contract and not fee. This means that
when the laboratory management contractor requests, per the regulation
at 48 CFR 970.3101-3, that the contracting officer consider some home
office expense allowable under the contract, the contractor must
propose the expense as a charge to the contract and not fee.
Nevertheless, to diminish the possibility of confusion, DOE has added
the language ``(but see 48 CFR 970.15404-1-3(b)(1) if the contract is
for the management and operation of a laboratory)'' to 48 CFR 970.3101-
3(a)(3)(i). Additionally, we have added ``(including 48 CFR 970.31)''
after ``regulations'' to 48 CFR 970.15404-1-3(b)(1) to emphasize that
the FAR cost principles, including home office expense, are
supplemented by 48 CFR 970.31 in all M&O contracts.
Comment: One respondent asserted that conventional allocation bases
are not always appropriate, since they presume significant investment
in the operations. This respondent suggests that 48 CFR 970.3101-3 be
revised to state that the nature of the M&O contracting environment
creates a unique environment and conventional home office cost
allocation bases may be inappropriate. Contracting officers should
evaluate the contractor's specific circumstances and pursue an advance
agreement covering the allowability of home office expenses.
Response: DOE fails to see where the policy at 48 CFR 970.3101-3
does not provide everything that the respondent seeks. The policy
clearly recognizes that ``the nature of the M&O contracting environment
creates a unique environment.'' And it clearly states that
``conventional home office cost allocation bases may be
inappropriate.'' It also requires the HCA's approval for any contractor
request to make some home office expense allowable under the contract.
It is clear that under the policy at 48 CFR 970.3101-3, contracting
officers will evaluate the contractor's specific circumstances.
Comment: One commenter claimed that proposed 48 CFR 970.3101-3(a)
eliminates contracting officer discretion to make home office expenses
fully allowable when circumstances warrant.
Response: While DOE agrees that the policy at 48 CFR 970.3101-3
precludes contracting officers from making home office expenses fully
allowable, DOE disagrees that this ``eliminates'' any discretion that
contracting officers formerly held. The Department's policy as stated
in the DEAR for many years has been that the contractor's fee generally
provides adequate compensation for home office expense. Under the
Department's policy, exceptions were allowed, but it included a
requirement to recognize that some home office expense had been
accounted for in the management and operating contractor's fee. The
policy at 48 CFR 970.3101-3 simply continues the Department's
traditional policy.
970.3101-9 (970.3101-9) Advance Agreements
Comment: Two respondents commented that they believed the intent of
48 CFR 970.3101-9, Advance Agreements, is to emphasize the non-
inclusive nature of the list of potential advance agreement candidates.
A respondent recommended replacing the language in the proposed rule
with:
``At any time, in accordance with the contract terms and
conditions, the contracting officer may pursue an advance agreement in
connection with any cost item under the contract.''
Response: The Department concurs and has made the change as
suggested.
970.3102-6 (970.3102-05-6) Compensation for Personal Services
Comment: Two respondents commented on the proposed coverage at 48
CFR 970.3102-6, Compensation. One stated that significant effort has
been invested in streamlining personnel matters to reduce cost and
administrative burden and a manageable personnel appendix was the
result. The respondent recommended against a requirement that would
revert to the burdensome personnel appendices of the past.
Response: There is no new language, and there are no new
requirements. DOE sites and facilities should continue to use those
policies and practices that have been jointly developed over the life
of the contract.
970.3102-18 (970.3102-05-18) Independent Research and Development and
Bid and Proposal Costs
Comment: Two responders commented that the proposed coverage at 48
CFR 970.3102-18, Independent Research and Development and Bid and
Proposal Costs, should be clarified to distinguish between bid and
proposal costs a contractor incurs to obtain new business in its non-
FFRDC operations and preparation of proposal costs incurred by FFRDCs
to perform work authorized by the sponsoring agency for others.
Additionally, the respondents recommended that contracting officer-
approved Laboratory Directed Research and Development costs be
specified as allowable costs notwithstanding any other treatment of
IR&D.
Response: DOE concurs. The coverage has been rewritten to identify
and distinguish between approved Laboratory Directed Research and
Development costs and bid and proposal costs and those costs incurred
under the rubric of the Department's various ``reimbursable programs.''
970.3102-20 (no new citation) Interest and Other Financial Costs
Comment: One commenter pointed out that proposed 48 CFR 970.3102-
20, Interest and other financial costs, is not necessary. The cost
principles at 48 CFR 31.205-10 and 48 CFR 31.205-20 provide adequate
coverage.
Response: DOE concurs and has deleted the proposed coverage.
970.3102-21 (no new citation) Fines and Penalties
Comment: The proposed rulemaking adopts the FAR coverage on fines
and penalties. Both FAR and DEAR provide exceptions to fines or
penalties when they are the result of (1) the terms and conditions of
the contract, or (2) written direction of the contracting officer.
However, the DEAR provides another exception not contained in the FAR
coverage; when such a civil fine or penalty was imposed without regard
to fault and could not have been avoided by the exercise of due care.
The respondent recommended DOE retain this exception.
Response: The language applicable to the Department's contractors
should be the same as that applied to other Federal contractors since
this type of issue is not unique to the Department's contractors. There
is already sufficient flexibility within the FAR cost principle to
authorize reimbursement of this cost category when conditions warrant.
970.3102-46 (970.3102-05-46) Travel Costs
Comment: Though Congress has mandated separate travel requirements
for DOE contractors (P.L. 106-60), one respondent stated that this
should not be a barrier to the use of FAR language. FAR language could
be incorporated into each contract and supplemented if the regulatory
climate (reasonableness standard) and the statutory climate change.
Response: Although the respondent's proposed solution is one way of
addressing the issue, the Department believes that the statutory
direction should be implemented in the
[[Page 80999]]
regulation rather than on a contract-by-contract basis.
Comment: One commenter contended that the detailed description
constrains the contractor from pursuing other travel reimbursement
policies that may be more economical overall to the Government and
still meet the intent of P.L. 106-60, Section 309.
Response: DOE disagrees. The deviation provisions contained in the
DEAR permit the consideration of modifications to a cost principle
where economies or efficiencies can be demonstrated (except for those
cost principles statutorily mandated).
Comment: Two respondents commented that the cost principle should
not be adopted, since the source of this requirement is appropriations
law, not substantive law. The respondents recommended developing a
clause that commits the contractor to abide by any applicable
restrictions communicated by the contracting officer in providing
appropriated funds to the contractor.
Response: DOE disagrees. The Department believes that the
establishment of consistent, comprehensive policy direction is the
appropriate course of action.
970.5204-13 (no new citation) Allowable Costs and Fixed-Fee
Comment: One commenter disagreed with the proposed deletion of this
clause, arguing that contracting officers should be authorized to
develop a local allowable cost clause that adapts the relevant portions
of 48 CFR Part 31.
Response: DOE disagrees. The intent of this rulemaking is to
eliminate redundancy in the DEAR and bring the Department's cost
reimbursement practices in alignment with the rest of the federal
government, except when a different practice is specifically warranted
by the nature of the Department's activities. Local clauses are
designed to address local issues, not those that are common throughout
the Department.
970.5204-16 (970.5232-2) Payments and Advances
Comment: One respondent asserted that the proposed reference should
be to 48 CFR part 31, not to 48 CFR subpart 31.2.
Response: DOE disagrees. The activities carried out under the
Department's management and operating contracts have always been
subject to the same cost principles, regardless of whether the entity
performing the contract was a for-profit entity, a non-profit entity,
or an educational institution. Now the cost principles will be those
provided at 48 CFR Subpart 31.2.
970.5204-XX (970.5242-1) Penalties for Unallowable Costs
Comment: Paragraph (b) of the clause states ``* * * the contracting
officer shall assess a penalty * * *'' but paragraph (e) states ``The
contracting officer may waive the penalty provision * * *'' A
respondent recommended changing the ``shall'' to ``may.''
Response: The language contained in the coverage is identical to
that contained in statute, Section 2151(b) of Pub. L. 103-355.
31.205-30 (970.3102-05-30) Patent Costs
Comment: One commenter argued that use of only the FAR cost
principle would adversely affect the Laboratories' ability to carry out
DOE's and the Laboratories' technology transfer mission. The deletion
of the entire 48 CFR 970.5204-13(d)(7) without a compensating fix to
allow patent related costs is not acceptable.
Response: While DOE does not necessarily agree that the FAR cost
principle is insufficient because of the importance of the technology
transfer mission, DOE has added coverage at 48 CFR 970.3102-05-30 for
Patent costs and technology transfer costs. The coverage distinguishes
between contracts that include and contracts that do not include the
clause at 48 CFR 970.5227-3, Technology Transfer Mission.
Part 970 Rewrite Conversion Table
The following conversion table shows how this rule reorganizes and
renumbers Part 970. (The table's ``Current Citation'' column reflects
the DEAR as it was prior to: the ``Financial Management Clauses for
Management and Operating Contracts'' final rule, 65 FR 21371, April 21,
2000; the Costs Associated with ``Whistleblower Actions'' final rule,
65 FR 62299, October 18, 2000; and the ``Revision of Patent Regulations
Relating to DOE Management and Operating Contracts'' interim final
rule, 65 FR 68932, November 15, 2000.)
------------------------------------------------------------------------
New citation Current citation Title
------------------------------------------------------------------------
970.01........................ N/A.............. Management and
Operating Contract
Regulatory System.
970.0100...................... 970.0000......... Scope of Part.
N/A........................... 970.0001......... [Reserved].
970.0103...................... N/A.............. Publication and
Codification.
970.03........................ 970.03 [Note: Improper Business
Current 970.03 Practices and
is reserved].. Personal Conflicts
of Interest.
970.0309...................... 970.2274......... Whistleblower
Protection of
Contractor
Employees.
970.0309-1.................... 970.2274-1(a).... Applicability.
970.0370...................... 970.0901 (Title). Management Controls
and Improvements.
970.0370-1.................... 970.0901(a), (b), Policy.
and (c).
970.0370-2.................... N/A.............. Contract Clause.
970.0371...................... 970.2272 (Title). Conduct of Employees
of DOE Management
and Operating
Contractors.
970.0371-1.................... 970.2272(a)...... Scope of Section.
970.0371-2.................... 970.2272(b)(1)... Applicability.
970.0371-3.................... N/A.............. Definition.
970.0371-4.................... 970.2272(c)...... Gratuities.
970.0371-5.................... 970.2272(d)...... Use of Privileged
Information.
970.0371-6.................... 970.2272(g)...... Incompatibility
Between Regular
Duties and Private
Interests.
970.0371-7.................... 970.2272(e)...... Outside Employment of
Contractor
Employees.
970.0371-8.................... 970.2272(f)...... Employee Disclosure
Concerning Other
Employment Services.
970.0371-9.................... 970.2272(b)(2) Contract Clause.
and (3).
970.04........................ 970.04........... Administrative
Matters.
970.0404...................... 970.0404......... Safeguarding
Classified
Information.
970.0404-1.................... 970.0404-1....... Definitions.
970.0404-2.................... 970.0404-2....... General.
[[Page 81000]]
970.0404-3.................... 970.0404-3 (a) Responsibilities of
and (b). Contracting
970.0404-4 (d)... Officers.
970.0404-4.................... 970.0404-4 (a), Solicitation
(b) and (c). Provision and
Contract Clauses.
N/A........................... 970.0406......... [Reserved].
970.0407...................... N/A.............. Contractor Records
Retention.
970.0407-1.................... 970.0407......... Applicability.
970.0407-1-1.................. 970.0407-1....... Alternate Retention
Schedules.
970.0407-1-2.................. 970.0407-2....... Access to and
Ownership of
Records.
970.0407-1-3.................. 970.0407-3....... Contract Clause.
970.0470...................... 970.0470......... Department of Energy
Directives.
970.0470-1.................... 970.0470-1....... General.
970.0470-2.................... 970.0470-2....... Contract Clause.
970.08........................ 970.08........... Required Sources of
Supplies and
Services.
970.0801...................... 970.0801 (Title). Excess Personal
Property.
970.0801-1.................... 970.0801 (Text).. Policy.
970.0808...................... N/A.............. Acquisition of
Printing.
970.0808-1.................... N/A.............. Scope of Section.
970.0808-2.................... N/A.............. Policy.
970.0808-3.................... N/A.............. Contract Clause.
970.09........................ 970.09........... Contractor
Qualifications.
970.0905...................... 970.0905......... Organizational
Conflicts of
Interest.
970.0970...................... N/A.............. Performance
Guarantees.
970.0970-1.................... 970.0902(a), (b) Determination of
and (c). Responsibility.
970.0970-2.................... 970.0902(d)...... Solicitation
Provision.
970.11........................ 970.10........... Describing Agency
Needs
970.1100...................... N/A.............. Policy.
970.1100-1.................... 970.1001......... Performance-based
Contracting.
970.1100-2.................... 970.1002......... Additional
Considerations
970.1103-4.................... N/A.............. Contract Clause
970.15........................ 970.15........... Contracting by
Negotiation.
970.1504...................... N/A.............. Contract Pricing.
970.1504-1.................... N/A.............. Price Analysis.
970.1504-1-1.................. 970.15404-4...... Fees for Management
and Operating
Contracts.
970.1504-1-2.................. 970.15404-4-1.... Fee Policy.
970.1504-1-3.................. 970.15404-4-2.... Special
Considerations:
Laboratory
Management and
Operation.
970.1504-1-4.................. 970.15404-4-3.... Types of Contracts
and Fee
Arrangements.
970.1504-1-5.................. 970.15404-4-4.... General
Considerations and
Techniques for
Determining Fixed
Fees.
970.1504-1-6.................. 970.15404-4-5.... Calculating Fixed
Fee.
970.1504-1-7.................. 970.15404-4-6.... Fee Base.
970.1504-1-8.................. 970.15404-4-7.... Special Equipment
Purchases.
970.1504-1-9.................. 970.15404-4-8.... Special
Considerations: Cost-
plus-award-fee.
970.1504-1-10................. 970.15404-4-9.... Special
Considerations: Fee
Limitations.
970.1504-1-11................. 970.15404-4-10... Documentation.
970.1504-2.................... 970.15405........ Price Negotiation.
970.1504-3.................... N/A.............. Documentation.
970.1504-3-1.................. 970.15406-2...... Cost or Pricing Data.
970.1504-4.................... N/A.............. Special Cost or
Pricing Areas.
970.1504-4-1.................. 970.15407-2...... Make-Or-Buy Plans.
970.1504-4-2.................. 970.15407-2-1.... Policy.
970.1504-4-3.................. 970.15407-2-2.... Requirements.
970.1504-5.................... 970.15404-4-11... Solicitation
Provision and
Contract Clauses
970.15407-2-3................. 970.15407-2-3
970.17........................ 970.17........... Special Contracting
Methods
970.1706...................... N/A.............. Management and
Operating Contracts.
970.1706-1.................... 970.1702-1....... Award, Renewal, and
Extension.
970.1706-2.................... 970.1702-2....... Contract Clause.
970.19........................ 970.19........... Small, Small
Disadvantaged and
Women-owned Small
Business Concerns
970.1907...................... N/A.............. Subcontracting with
Small Business,
Small Disadvantaged
Business and Woman-
owned Small Business
Concerns.
970.1907-1.................... 970.1901......... Subcontracting Plan
Requirements.
N/A........................... 970.20........... [Reserved]
970.22........................ 970.22........... Application of Labor
Policies
970.2200...................... N/A.............. Scope of Subpart
970.2201...................... 970.2201......... Basic Labor Policies.
970.2201-1.................... N/A.............. Labor Relations.
970.2201-1-1.................. 970.2201(a)...... General.
970.2201-1-2.................. 970.2201(b)...... Policies.
970.2201-1-3.................. 970.2201(b)(5)(ii Contract Clause.
).
970.2201-2.................... 970.2275......... Overtime Management
970.2201-2-1.................. 970.2275-1....... Policy.
970.2201-2-2.................. 970.2275-2....... Contract Clause.
N/A........................... 970.2206......... Walsh-Healey Public
Contracts Act.
[[Page 81001]]
970.2204...................... N/A.............. Labor Standards for
Contracts Involving
Construction.
970.2204-1.................... N/A.............. Statutory and
Regulatory
Requirements.
970.2204-1-1.................. 970.2273......... Administrative
Controls and
Criteria for
Application of the
Davis-Bacon Act in
Operational or
Maintenance
Activities.
970.2208...................... 970.2208......... Equal Employment
Opportunity.
970.2210...................... 970.2210......... Service Contract Act.
970.2270...................... 970.2270......... Unemployment
Compensation.
970.23........................ 970.23........... Environmental,
Conservation, and
Occupational Safety
Programs
970.2303...................... 970.2303......... Hazardous Materials
Identification and
Material Safety.
970.2303-1.................... 970.2303-1....... General.
970.2303-2.................... 970.2303-2....... Clauses.
970.2304...................... 970.2304......... Use of Recovered/
Recycled Materials.
970.2304-1.................... 970.2304-1....... General.
970.2304-2.................... 970.2304-2....... Contract Clause.
970.2305...................... 970.2305......... Workplace Substance
Abuse Programs-
Management and
Operating Contracts.
970.2305-1.................... 970.2305-1....... General.
970.2305-2.................... 970.2305-2....... Applicability.
970.2305-3.................... 970.2305-3....... Definitions.
970.2305-4.................... 970.2305-4....... Solicitation
Provision and
Contract Clause.
970.2306...................... 970.2305-5....... Suspension of
Payments,
Termination of
Contract, and
Debarment and
Suspension Actions.
N/A........................... 970.25........... Foreign Acquisition.
970.26........................ 970.26........... Other Socioeconomic
Programs.
970.2670...................... 970.2601 (Title). Implementation of
Section 3021 of the
Energy Policy Act of
1992.
970.2670-1.................... 970.2601(a)...... Requirements.
970.2671...................... N/A.............. Diversity.
970.2671-1.................... 970.2601(b)...... Policy.
970.2671-2.................... 970.2602-2(b).... Contract Clause.
970.2672...................... 970.2602-1....... Implementation of
Section 3161 of the
National Defense
Authorization Act
for Fiscal Year
1993.
970.2672-1.................... 970.2602-1(a).... Policy.
970.2672-2.................... 970.2602-1(b).... Requirements.
970.2672-3.................... 970.2602-2(a).... Contract Clause.
970.2673...................... N/A.............. Regional
Partnerships.
970.2673-1.................... N/A.............. Policy.
970.2673-2.................... N/A.............. Contract Clause.
970.27........................ 970.27........... Patents, Data, and
Copyrights.
970.2701...................... 970.2701 (Title). General.
970.2701-1.................... 970.2701 (Text).. Applicability.
970.2702...................... N/A.............. Patent related
clauses.
970.2702-1.................... N/A.............. Authorization and
consent.
970.2702-2.................... N/A.............. Notice and assistance
regarding patent and
copyright
infringement.
970.2702-3.................... N/A.............. Patent indemnity.
970.2702-4.................... N/A.............. Royalties.
970.2702-5.................... N/A.............. Rights to proposal
data.
970.2702-6.................... N/A.............. Notice of right to
request patent
waiver.
970.2703...................... 970.2702 (Title). Patent Rights.
970.2703-1.................... 970.2702 (Text).. Purposes of patent
rights clauses.
970.2703-2.................... 970.2704......... Patent rights clause
provisions for
management and
operating
contractors.
970.2704...................... N/A.............. Rights in Data.
970.2704-1.................... 970.2705......... General.
970.2704-2.................... 970.2706......... Procedures.
970.2704-3.................... 970.2707......... Contract Clauses.
970.2770...................... 970.73........... Technology Transfer.
970.2770-1.................... 970.7310......... General.
970.2770-2.................... 970.7320......... Policy.
970.2770-3.................... 970.2703......... Technology Transfer
and Patent Rights.
970.2770-4.................... 970.7330......... Contract Clause.
970.28........................ 970.28........... Bonds and Insurance.
970.2803...................... N/A.............. Insurance.
970.2803-1.................... 970.2271......... Workers' Compensation
Insurance.
970.2803-2.................... 970.2830......... Contract Clause.
970.29........................ 970.29........... Taxes.
970.2902...................... N/A.............. Federal Excise Taxes.
970.2902-1.................... 970.2901......... Exemptions from
Federal Excise
Taxes.
970.2903...................... N/A.............. State and Local
Taxes.
970.2903-1.................... 970.2902......... Applicability of
State and Local
Taxes to the
Government.
970.2904...................... N/A.............. Contract Clauses.
970.2904-1.................... 970.2903......... Management and
Operating Contracts.
970.30........................ 970.30........... Cost Accounting
Standards.
970.3002...................... 970.3001......... CAS Program
Requirements.
970.3002-1.................... 970.3001-1....... Applicability.
[[Page 81002]]
N/A........................... 970.3001-2....... Limitations.
970.31........................ 970.31........... Contract Cost
Principles and
Procedures.
970.3101-00-70................ 970.3100......... Scope of Subpart.
N/A........................... 970.3100-1....... Definitions.
N/A........................... 970.3100-2....... Responsibilities.
N/A........................... 970.3100-3....... Objectives.
970.3101-9.................... 970.3101-6....... Advance Agreements.
970.3101-10................... N/A.............. Cost certification.
970.3102-3-70................. N/A.............. Home Office Expenses.
N/A........................... 970.3101-7....... Cost Certification
and Penalties on
Unallowable Costs.
N/A........................... 970.3101......... General.
N/A........................... 970.3101-1....... Actual Cost Basis.
970.3102-05................... 970.3102......... Application of Cost
Principles.
N/A........................... 970.3101-3....... General Basis for
Reimbursement of
Costs.
N/A........................... 970.3101-4....... Cost Determination
Based on Audit.
N/A........................... 970.3101-5....... Contractor's System
of Accounting.
N/A........................... 970.3101-2....... Direct and Indirect
Costs.
N/A........................... N/A.............. Selected Costs.
N/A........................... 970.3102-19..... Public Relations and
Advertising.
970.3102-05-4................. N/A.............. Bonding costs.
970.3102-05-6................. 970.3102-2....... Compensation for
Personal Services.
970.3102-05-18................ N/A.............. Independent research
and development and
bid and proposal
costs.
970.3102-05-19................ N/A.............. Insurance and
indemnification.
N/A........................... 970.3102-3....... Cost of Money.
N/A........................... 970.3102-4....... Depreciation.
N/A........................... 970.3102-5....... Employee Morale,
Health, Welfare,
Food Service, and
Dormitory Costs.
N/A........................... 970.3102-21...... Fines, Penalties.,
and Mischarging
Costs.
970.3102-05-22................ 970.3102-7....... Lobbying and
Political Activity
Costs.
970.3102-05-28................ N/A.............. Other business
expenses.
970.3102-05-30................ N/A.............. Patent costs and
technology transfer
costs.
N/A........................... 970.3102-1....... General and
Administrative
Expenses.
N/A........................... 970.3102-12...... Plant Reconversion
Costs.
N/A........................... 970.3102-13...... Precontract Costs.
N/A........................... 970.3102-9....... Professional and
Consultant Service
Costs.
N/A........................... 970.3102-16...... Relocation Costs.
N/A........................... 970.3102-8....... Trade, Business and
Professional
Activity Costs.
970.3102-05-46................ 970.3102-17...... Travel Costs.
970.3102-05-47................ 970.3102-20...... Cost Related to Legal
and Other
Proceedings.
970.3102-05-53................ N/A.............. Preexisting
conditions.
N/A........................... 970.3102-10...... Overtime, Shift, and
Holiday Premiums.
N/A........................... 970.3102-11...... Page Charges in
Scientific Journals.
N/A........................... 970.3102-14...... Preparatory and Make-
Ready Costs.
N/A........................... 970.3102-6....... Facilities (Plant and
Equipment).
N/A........................... 970.3102-18...... Special Funds in the
Construction
Industry.
N/A........................... 970.3102-15...... Procurement:
Subcontracts,
Contractor-
Affiliated Sources,
and Leases.
970.3170...................... 970.3103......... Contract Clause.
970.32........................ 970.32........... Contract Financing
970.3200...................... 970.3201......... Policy.
970.3200-1.................... 970.3272(a) and b Reduction or
Suspension of
Advance, Partial, or
Progress Payments.
970.3200-1-1.................. 970.3272 (d)..... Contract Clause.
970.3204...................... 970.3202 (Title). Advance Payments.
970.3204-1.................... 970.3202 (Text).. Applicability.
N/A........................... 970.3271......... Special Bank Account
Agreement.
970.3270...................... 970.3270......... Standard Financial
Management Clauses.
970.34........................ 970.70........... Major System
Acquisition.
970.3400...................... N/A.............. General Requirements.
970.3400-1.................... 970.7000......... Mission-oriented
Solicitation.
970.35........................ N/A.............. Research and
Development
Contracting
970.3500...................... N/A.............. Scope of Subpart.
970.3501...................... N/A.............. Federally Funded
Research and
Development Centers.
970.3501-1.................... N/A.............. Sponsoring
Agreements.
970.3501-2.................... N/A.............. Using an FFRDC.
970.3501-3.................... N/A.............. Reviewing FFRDC's.
970.3501-4.................... N/A.............. Contract Clause.
970.36........................ 970.36........... Construction and
Architect-Engineer
Contracts.
970.3605...................... N/A.............. Contract Clauses.
970.3605-1.................... 970.5204-43...... Other Contracts.
970.3605-2.................... 970.3601......... Special Construction
Clause for Operating
Contracts.
970.37........................ N/A.............. Facilities Management
Contracting.
970.3770...................... 970.72........... Facilities
Management.
970.3770-1.................... 970.7201......... Policy.
970.3770-2.................... 970.7201......... Contract Clause.
[[Page 81003]]
970.41........................ 970.41........... Acquisition of
Utility Services.
970.4102...................... N/A.............. Acquiring Utility
Services.
970.4102-1.................... 970.4100......... Policy.
970.42........................ N/A.............. Contract
Administration.
970.4207-03-02................ N/A.............. Certificate of costs.
970.4207-03-70................ N/A.............. Contract clause.
970.4207-05-01................ N/A.............. Contracting officer
determination
procedure.
970.43........................ N/A.............. Contract
Modifications.
970.4302...................... N/A.............. Changes.
970.4302-1.................... N/A.............. Contract Clause.
970.44........................ 970.71........... Management and
Operating Contractor
Purchasing.
970.4400...................... N/A.............. Scope.
970.4401...................... N/A.............. Responsibilities.
970.4401-1.................... 970.7102......... General.
970.4401-2.................... 970.7108......... Review and Approval.
970.4401-3.................... 970.7109......... Advance Notification.
970.4402...................... N/A.............. Contractor Purchasing
System.
970.4402-1.................... 970.7101......... Policy.
970.4402-2.................... 970.7103......... General Requirements.
970.4402-3.................... 970.7105......... Purchasing From
Contractor-
Affiliated Sources.
970.4402-4.................... 970.7110......... Nuclear Material
Transfers.
970.4403...................... N/A.............. Contract Clause.
970.45........................ 970.45........... Government Property.
970.4501...................... N/A.............. General.
970.4501-1.................... 970.4501......... Contract Clause.
970.49........................ 970.49........... Termination of
Contracts.
970.4905...................... N/A.............. Contract Termination
Clause.
970.4905-1.................... 970.4901 and Termination for
970.4902. Convenience of the
Government and
Default.
970.50........................ N/A.............. Extraordinary
Contractual Actions.
970.5004...................... N/A.............. Residual Powers.
970.5004-1.................... N/A.............. Contract Clause.
970.5070...................... 970.2870 (Title). Indemnification.
970.5070-1.................... 970.2870(a) and Scope and
(b). Applicability.
970.5070-2.................... 970.2870(e)...... General.
970.5070-3.................... 970.2870(c) and Contract Clauses.
(d).
N/A........................... 970.51........... Use of Government
Sources by
Contractors.
970.52........................ 970.52........... Solicitation
Provisions and
Contract Clauses for
Management and
Operating Contracts.
970.5200...................... 970.5201......... Scope of Subpart.
N/A........................... 970.5203......... Modifications and
Notes to Far
Clauses.
970.5201...................... 970.5204......... Text of Provisions
and Clauses.
970.5203-1.................... 970.5204-20...... Management Controls.
970.5203-2.................... N/A.............. Performance
Improvement and
Collaboration.
970.5203-3.................... 970.5204-12...... Contractor's
Organization.
970.5204-1.................... 970.5204-1....... Counterintelligence.
970.5204-2.................... 970.5204-78...... Laws, Regulations,
and DOE Directives.
970.5204-3.................... 970.5204-79...... Access to and
Ownership of
Records.
970.5208-1.................... 970.5204-19...... Printing.
970.5209-1.................... 970.5204-89...... Requirement for
Guarantee of
Performance.
970.5215-1.................... 970.5204-54...... Total Available Fee:
Base Fee Amount and
Performance Fee
Amount.
970.5215-2.................... 970.5204-76...... Make-or-Buy Plan.
970.5215-3.................... 970.5204-86...... Conditional Payment
of Fee, Profit, or
Incentives.
970.5215-4.................... 970.5204-87...... Cost Reduction.
970.5215-5.................... 970.5204-88...... Limitation on Fee.
970.5222-1.................... 970.5204-63...... Collective Bargaining
Agreements--Manageme
nt and Operating
Contracts.
970.5222-2.................... 970.5204-80...... Overtime Management.
970.5223-1.................... 970.5204-2....... Integration of
Environment, Safety
and Health into Work
Planning and
Execution.
970.5223-2.................... 970.5204-39...... Acquisition and Use
of Environmentally
Preferable Products
and Services.
970.5223-3.................... 970.5204-57...... Agreement Regarding
Workplace Substance
Abuse Programs at
DOE Facilities.
970.5223-4.................... 970.5204-58...... Workplace Substance
Abuse Programs at
DOE Sites.
970.5226-1.................... 970.5204-81...... Diversity Plan.
970.5226-2.................... 970.5204-77...... Workforce
Restructuring under
Section 3161 of the
National Defense
Authorization Act
for Fiscal Year
1993.
970.5226-3.................... N/A.............. Community Commitment.
970.5227-1.................... 970.5204-82...... Rights in Data-
Facilities.
970.5227-2.................... 970.5204-83...... Rights in Data-
Technology Transfer
970.5227-3.................... 970.5204-40...... Technology Transfer
Mission.
970.5227-4.................... N/A.............. Authorization and
consent.
970.5227-5.................... N/A.............. Notice and assistance
regarding patent and
copyright
infringement.
[[Page 81004]]
970.5227-6.................... N/A.............. Patent indemnity--
subcontracts.
970.5227-7.................... N/A.............. Royalty information.
970.5227-8.................... N/A.............. Refund of royalties.
970.5227-9.................... N/A.............. Notice of right to
request patent
waiver.
970.5227-10................... 970.5204-71...... Patent rights--
management and
operating contracts,
nonprofit
organization or
small business firm
contractor.
970.5227-11................... 970.5204-72...... Patent rights--
management and
operating contracts,
for-profit
contractor, non-
technology transfer.
970.5227-12................... N/A.............. Patent rights--
management and
operating contracts,
for-profit
contractor, advance
class waiver.
970.5228-1.................... 970.5204-31...... Insurance--Litigation
and Claims.
970.5229-1.................... 970.5204-23...... State and Local
Taxes.
N/A........................... 970.5204-13...... Allowable Costs and
Fee (Management and
Operating
Contracts).
970.5231-4.................... 970.5204-75...... Preexisting
Conditions.
970.5232-1.................... 970.5204-85...... Reduction or
Suspension of
Advance, Partial, or
Progress Payments
upon Finding of
Substantial Evidence
of Fraud.
970.5232-2.................... 970.5204-16...... Payments and
Advances.
970.5232-3.................... 970.5204-9....... Accounts, Records,
and Inspection.
970.5232-4.................... 970.5204-15...... Obligation of Funds.
970.5232-5.................... N/A.............. Liability with
respect to cost
accounting
standards.
970.5232-6.................... N/A.............. Work for others
funding
authorization.
970.5232-7.................... N/A.............. Financial management
system.
970.5232-8.................... N/A.............. Integrated
accounting.
970.5235-1.................... N/A.............. Federally Funded
Research and
Development Center
Sponsoring
Agreement.
970.5236-1.................... 970.5204-38...... Government Facility
Subcontract
Approval.
N/A........................... 970.5204-84...... Waiver of Limitations
on Severance
Payments to Foreign
Nationals.
970.5237-2.................... 970.5204-60...... Facilities
Management.
970.5242-1.................... N/A.............. Penalties for
unallowable costs.
970.5243-1.................... 970.5204-11...... Changes.
970.5244-1.................... 970.5204-22...... Contractor Purchasing
System.
970.5245-1.................... 970.5204-21...... Property.
N/A........................... 970.5204-3....... Buy American Act''
Construction
Materials.
N/A........................... 970.5204-4....... New Mexico Gross
Receipts and
Compensating Tax.
N/A........................... 970.5204-5....... Disclosure of
Information.
N/A........................... 970.5204-6....... Nuclear Hazards
Indemnity.
N/A........................... 970.5204-7....... Protecting the
Government's
Interest When
Subcontracting with
Contractors
Debarred, Suspended,
or Proposed for
Debarment.
N/A........................... 970.5204-8....... Indemnity Assurance
to Architect-
Engineer or Supplier
Prior to Operation
of a Nuclear
Facility.
N/A........................... 970.5204-10...... Foreign Ownership,
Control, or
Influence over
Contractors (FOCI).
N/A........................... 970.5204-14...... Allowable Costs and
Fixed-fee (Support
Contracts).
N/A........................... 970.5204-25...... Workmanship and
Materials.
N/A........................... 970.5204-27...... Consultant or Other
Comparable
Employment Services
of Contractor
Employees.
N/A........................... 970.5204-28...... Assignment.
N/A........................... 970.5204-29...... Permits or Licenses.
N/A........................... 970.5204-30...... Notice of Labor
Disputes.
N/A........................... 970.5204-33...... Priorities and
Allocations.
N/A........................... 970.5204-35...... Controls in the
National Interest
(Unclassified
Contracts with
Educational
Institutions).
N/A........................... 970.5204-36...... Preventing Conflicts
of Interest in
University Research.
N/A........................... 970.5204-37...... Statement of Work
(Management and
Operating
Contracts).
N/A........................... 970.5204-42...... Key Personnel.
N/A........................... 970.5204-43...... Other Government
Contractors.
N/A........................... 970.5204-44...... Flowdown of Contract
Requirements to
Subcontracts.
N/A........................... 970.5204-45...... Termination.
N/A........................... 970.5204-52...... Foreign Travel.
N/A........................... 970.5204-53...... Contractor Employee
Travel Discounts.
952.203-70.................... 970.5204-59...... Whistleblower
Protection for
Contractor
Employees.
N/A........................... 970.5204-71...... Patent Rights-
nonprofit Management
and Operating
Contractors.
N/A........................... 970.5204-72...... Patent Rights-profit-
making Management
and Operating
Contractors.
N/A........................... 970.5204-73...... Notice Regarding
Options.
N/A........................... 970.5204-74...... Option to Extend the
Term of the
Contract.
------------------------------------------------------------------------
III. Procedural Requirements
A. Review Under Executive Order 12866
Today's regulatory action has been determined not to be a
``significant regulatory action'' under Executive Order 12866,
``Regulatory Planning and Review,'' (58 FR 51735, October 4, 1993).
Accordingly, today's action was not subject to review under the
Executive Order by the Office of Information and Regulatory Affairs of
the Office of Management and Budget.
B. Review Under Executive Order 12988
With respect to the review of existing regulations and the
promulgation of
[[Page 81005]]
new regulations, section 3(a) of Executive Order 12988, ``Civil Justice
Reform,'' 61 FR 4729 (February 7, 1996), imposes on Executive agencies
the general duty to adhere to the following requirements: (1) Eliminate
drafting errors and ambiguity; (2) write regulations to minimize
litigation; and (3) provide a clear legal standard for affected conduct
rather than a general standard and promote simplification and burden
reduction. With regard to the review required by section 3(a), section
3(b) of Executive Order 12988 specifically requires that Executive
agencies make every reasonable effort to ensure that the regulation:
(1) Clearly specifies the preemptive effect, if any; (2) clearly
specifies any effect on existing Federal law or regulation; (3)
provides a clear legal standard for affected conduct while promoting
simplification and burden reduction; (4) specifies the retroactive
effect, if any; (5) adequately defines key terms; and (6) addresses
other important issues affecting clarity and general draftsmanship
under any guidelines issued by the Attorney General. Section 3(c) of
Executive Order 12988 requires Executive agencies to review regulations
in light of applicable standards in section 3(a) and section 3(b) to
determine whether they are met or it is unreasonable to meet one or
more of them. DOE has completed the required review and determined
that, to the extent permitted by law, the proposed regulations meet the
relevant standards of Executive Order 12988.
C. Review Under the Regulatory Flexibility Act
This rule was reviewed under the Regulatory Flexibility Act of
1980, Pub. L. 96-354, which requires preparation of a regulatory
flexibility analysis for any rule which is likely to have a significant
economic impact on a substantial number of small entities. This rule
would only apply to M&O contractors, which are all large entities. DOE
certified that the rules that are formalized today will not have a
significant economic impact on a substantial number of small entities
and, therefore, no regulatory flexibility analysis has been prepared.
DOE did not receive any comments on its certifications.
D. Review Under the Paperwork Reduction Act
No new information collection requirements subject to the Paperwork
Reduction Act, 44 U.S.C. 3501 et seq., are imposed by today's
regulatory action.
E. Review Under Executive Order 13132
Executive Order 13132 (64 FR 43255, August 4, 1999) imposes certain
requirements on agencies formulating and implementing policies or
regulations that preempt State law or that have federalism
implications. Agencies are required to examine the constitutional and
statutory authority supporting any action that would limit the
policymaking discretion of the States and carefully assess the
necessity for such actions. DOE has examined today's rule and has
determined that it does not preempt State law and does not have a
substantial direct effect on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government. No further
action is required by Executive Order 13132.
F. Review Under the National Environmental Policy Act
Pursuant to the Council on Environmental Quality Regulations (40
CFR Parts 1500-1508), the Department of Energy has established
guidelines for its compliance with the provisions of the National
Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq.).
Pursuant to appendix A of subpart D of 10 CFR part 1021, National
Environmental Policy Act Implementing Procedures (57 FR 15122, 15152,
April 24, 1992) (Categorical Exclusion A6), the Department of Energy
has determined that this rule is categorically excluded from the need
to prepare an environmental impact statement or environmental
assessment.
G. Review Under the Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 requires each
Agency to assess the effects of Federal regulatory action on State,
local, and tribal governments and the private sector. The Department
has determined that today's regulatory action does not impose a Federal
mandate on State, local, or tribal governments or on the private
sector.
H. Review Under Small Business Regulatory Enforcement Fairness Act of
1996
As required by 5 U.S.C. 801, the Department of Energy will report
to Congress promulgation of the rule prior to its effective date. The
report will state that it has been determined that the rule is not a
``major rule'' as defined by 5 U.S.C. 804(3).
List of Subjects in 48 CFR Parts 901, 902, 903, 904, 909, 911, 915,
917, 922, 923, 927, 941, 942, 947, 951, 952, and 970.
Government procurement.
Issued in Washington, D.C. on November 30, 2000.
T.J. Glauthier,
Deputy Secretary, Department of Energy.
For the reasons set out in the preamble, Chapter 9 of Title 48 of
the Code of Federal Regulations is amended as set forth below.
1. The authority citations for parts 901, 902, 903, 904, 909, 911,
915, 917, 922, 923, 941, 942, 947, 951, and 952 continue to read as
follows:
Authority: 42 U.S.C. 7254; 40 U.S.C. 486(c); 50 U.S.C. 2401 et
seq.
PART 901--FEDERAL ACQUISITION REGULATIONS SYSTEM
901.105 [Amended]
2. Section 901.105 is amended in the second sentence by revising
``(see 48 CFR (DEAR) 970.5204-76)'' to read ``(see 48 CFR 970.5215-
2)'', and by revising ``(see 48 CFR (DEAR) 970.5204-2)'' to read ``(see
48 CFR 970.5223-1).''
PART 902--DEFINITIONS OF WORDS AND TERMS
3. Section 902.200 is revised to read as follows:
902.200 Definitions clause.
As prescribed by 48 CFR Subpart 2.2, insert the clause at 48 CFR
52.202-1, Definitions, but modify the clause to limit the definition at
paragraph (a) to encompass only the Secretary, Deputy Secretary, or
Under Secretary of the Department of Energy, and the Chairman, Federal
Energy Regulatory Commission. The contracting officer shall also add a
paragraph at the end of the clause that defines ``DOE'' as meaning the
United States Department of Energy and ``FERC'' as meaning the Federal
Energy Regulatory Commission. Additional definitions may be included,
provided they are consistent with the clause, the Federal Acquisition
Regulation and this Department of Energy Acquisition Regulation.
PART 903--IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF
INTEREST
4. Subpart 903.9 is added to read as follows:
Subpart 903.9--Whistleblower Protection for Contractor Employees
[[Page 81006]]
Sec.
903.901 Scope.
903.902 Definition.
903.903 Applicability.
903.970 Remedies.
903.971 Contract clause.
Subpart 903.9--Whistleblower Protection for Contractor Employees
903.901 Scope.
This subpart implements the DOE Contractor Employee Protection
Program as set forth at 10 CFR part 708. Part 708 establishes criteria
and procedures for the investigation, hearing, and review of
allegations from DOE contractor employees of employer reprisal
resulting from employee disclosure of information to DOE, to Members of
Congress, or to the contractor; employee participation in proceedings
before Congress or pursuant to this subpart; or employee refusal to
engage in illegal or dangerous activities, when such disclosure,
participation, or refusal pertains to employer practices which the
employee believes to be unsafe; to violate laws, rules, or regulations;
or to involve fraud, mismanagement, waste, or abuse.
903.902 Definition.
Contractor, as used in this subpart, has the meaning contained in
10 CFR 708.2.
903.903 Applicability.
10 CFR part 708 is applicable to complaints of retaliation filed by
employees of contractors, and subcontractors, performing work on behalf
of DOE directly related to DOE-owned or leased facilities, if the
complaint stems from a disclosure, participation, or refusal described
in 10 CFR 708.5.
903.970 Remedies.
(a) Contractors found to have retaliated against an employee in
reprisal for such disclosure, participation or refusal are required to
provide relief in accordance with decisions issued under 10 CFR part
708.
(b) 10 CFR part 708 provides that for the purposes of the Contract
Disputes Act (41 U.S.C. 605 and 606), a final decision issued pursuant
to 10 CFR part 708 shall not be considered to be a claim by the
Government against a contractor or a decision by the contracting
officer subject to appeal. However, a contractor's disagreement and
refusal to comply with a final decision could result in a contracting
officer's decision to disallow certain costs or to terminate the
contract for default. In such case, the contractor could file a claim
under the Disputes clause of the contract regarding the disallowance of
cost or the termination of the contract.
903.971 Contract clause.
The contracting officer shall insert the clause at 952.203-70,
Whistleblower Protection for Contractor Employees, in contracts that
involve work to be done on behalf of DOE directly related to activities
at DOE-owned or leased sites.
PART 904--ADMINISTRATIVE MATTERS
5. Subpart 904.72 is added to read as follows:
Subpart 904.72--Public Affairs
Sec.
904.7200 Purpose.
904.7201 Contract clause.
Subpart 904.72--Public Affairs
904.7200 Purpose.
It is the policy of the Department of Energy to provide to the
public and the news media, accurate and timely unclassified information
on Departmental policies, programs, and activities. The Department's
contractors share the responsibility for releasing unclassified
information related to efforts under their contracts and must
coordinate the release of unclassified information with the cognizant
contracting officer and appropriate DOE Public Affairs personnel.
904.7201 Contract clause.
The contracting officer shall insert the clause at 952.204-75 in
solicitations and contracts that require the contractor to release
unclassified information related to efforts under its contract
regarding DOE policies, programs, and activities.
PART 909--CONTRACTOR QUALIFICATIONS
909.104-1 [Amended]
6. Subsection 909.104-1 is amended by revising ``48 CFR 970.5204-
57'' to read ``48 CFR 970.5223-3.''
PART 911--DESCRIBING AGENCY NEEDS
7. Section 911.604 is amended by revising paragraphs (d) and (e) to
read as follows:
911.604 Solicitation provision and contract clause.
* * * * *
(d) The contracting officer shall insert the provision at 952.211-
70, Priorities and Allocations (Domestic Energy Supplies), with its
Alternate I, in solicitations that may result in the placement of rated
orders for authorized energy programs, and in solicitations for all
management and operating contracts.
(e) The contracting officer shall insert the clause at 952.211-71,
Priorities and Allocations (Domestic Energy Supplies), with its
Alternate I, if it is believed the contract involves a program the
purpose of which is to maximize domestic energy supplies, and in all
management and operating contracts.
PART 915--CONTRACTING BY NEGOTIATION
8. Subsection 915.408-70 is added to read as follows:
915.408-70 Solicitation provision and contract clause.
The contracting officer (after deleting ``under the clause at 48
CFR 970.5203-3, Contractor's Organization'' from paragraph (a) if not a
management and operating contract) shall insert the clause at 48 CFR
952.215-70, Key Personnel, in contracts under which performance is
largely dependent on the expertise of specific key personnel.
PART 917--SPECIAL CONTRACTING METHODS
9. Section 917.600 is revised to read as follows:
917.600 Scope of subpart.
(a) This subpart implements 48 CFR subpart 17.6, Management and
Operating Contracts. Departmental policies, procedures, provisions and
clauses to be used in the award and administration of management and
operating contracts that either implement or supplement the Federal
Acquisition Regulation and parts 901 through 952 of this chapter are
contained in 48 CFR part 970.
(b) The requirements of this subpart apply to any Department of
Energy management and operating contract, including performance-based
management contracts as defined in 48 CFR 917.601. References in this
subpart to ``management and operating contracts'' include performance-
based management contracts.
10. Section 917.601 is amended by revising the definition of
performance-based contracting as follows:
917.601 Definitions.
Performance-based contracting has the meaning contained in 48 CFR
37.101.
* * * * *
11. Section 917.602 is revised to read as follows:
[[Page 81007]]
917.602 Policy.
(a) The use of a management and operating contract must be
authorized by the Secretary, Deputy Secretary or Under Secretary.
(b) It is the policy of the Department of Energy to provide for
full and open competition in the award of management and operating
contracts, including performance-based management contracts.
(c) A management and operating contract may be awarded or extended
at the completion of its term without providing for full and open
competition only when such award or extension is justified under one of
the statutory authorities identified in 48 CFR 6.302 and only when
authorized by the Head of the Agency. Documentation and processing
requirements for justifications for the use of other that full and open
competition shall be accomplished in accordance with internal agency
procedures
917.604 and 917.605 [Removed]
12. Sections 917.604 and 917.605 are removed.
PART 922--APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITION
922.71 [Removed]
13. Subpart 922.71 is removed.
PART 923--ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY AND DRUG-
FREE WORKPLACE
923.570-2 [Amended]
14. Subsection 923.570-2 is amended in paragraph (a) by revising ``
48 CFR 970.5204-57'' to read ``48 CFR 970.5223-3''; and in paragraph
(b) by revising ``970.5204-58'' to read ``48 CFR 970.5223-4.''
923.570-3 [Amended]
15. Subsection 923.570-3 is amended in paragraph (a) by revising ``
970.5204-58'' to read `` 48 CFR 970.5223-4'', and in paragraph (b)(2)
by revising ``970.5204-57'' to read `` 970.5223-3.''
PART 927--PATENTS, DATA, AND COPYRIGHTS
16. The authority citation for part 927 continues to read as
follows:
Authority: Atomic Energy Act of 1954, as amended (42 U.S.C.
2168, 2182, 2201); Federal Nonnuclear Energy Research and
Development Act of 1974 (42 U.S.C. 5908); Department of Energy
National Security and Military Applications of Nuclear Energy
Authorization Act of 1987 (42 U.S.C. 7261a.); Department of Energy
Organization Act (42 U.S.C. 7101 et seq.); National Nuclear Security
Administration Act (50 U.S.C. 4201 et seq.)
927.303 [Amended]
17. Paragraph (a)(3) of section 927.303 is amended by revising
``970.5204-71 or 970.5204-72'' to read ``970.5227-10, 970.5227-11, or
970.5227-12.''
927.402-1 [Amended]
18. Subsection 927.402-1 is amended in paragraph (b) by revising
``(see 970.2705)'' to read ``(see 48 CFR 970.2704)'', and by revising
``970.5204-82'' to read ``48 CFR 970.5227-1.''
927.404 [Amended]
19. Section 927.404 is amended in paragraph (g)(4) by revising
``970.5204-82'' to read ``48 CFR 970.5227-2.''
927.409 [Amended]
20. Section 927.409 is amended in paragraph (a)(2)(vi) by revising
``(See 970.2705)'' to read ``(see 48 CFR 970.2704).''
PART 935--RESEARCH AND DEVELOPMENT CONTRACTING
935.070 [Removed]
21. Section 935.070 is removed.
PART 941--ACQUISITION OF UTILITY SERVICES
22. Subsection 941.201-71 is amended by revising ``48 CFR
970.0803'' to read ``48 CFR 970.4102-1.''
PART 942--CONTRACT ADMINISTRATION
23. Subpart 942.2 is added as follows:
Subpart 942.2--Contract Administration Services
Sec.
942.270-1 Contracting Officer's Representatives
942.270-2 Contract Clause
Subpart 942.2--Contract Administration Services
942.270-1 Contracting Officer's Representatives.
In accordance with internal agency procedures, a contracting
officer may designate other qualified personnel to be the Contracting
Officer's Representative (COR) for the purpose of performing certain
technical functions in administering a contract. These functions
include, but are not limited to, technical monitoring, inspection,
approval of shop drawings, testing, and approval of samples. The COR
acts solely as a technical representative of the contracting officer
and is not authorized to perform any function that results in a change
in the scope, price, terms or conditions of the contract. COR
designations must be made in writing by the contracting officer, and
shall identify the responsibilities and limitations of the designation.
A copy of the COR designation must be furnished to the contractor and
the contract administration office.
942.270-2 Contract Clause.
The clause at 952.242-70, or a clause substantially the same, may
be inserted in solicitations and contracts when a designated
Contracting Officer's Representative will issue technical direction to
the contractor under the contract.
PART 947--TRANSPORTATION
24. Subpart 947.70 is added to read as follows:
Subpart 947.70--Foreign Travel
Sec.
947.7000 [Reserved]
947.7001 Policy.
947.7002 Contract clause.
Subpart 947.70--Foreign Travel
947.7000 [Reserved]
947.7001 Policy.
Contractor foreign travel shall be conducted pursuant to the
requirements contained in DOE Order 551.1, Official Foreign Travel, or
any subsequent version of the order in effect at the time of award.
947.7002 Contract clause.
When foreign travel may be required under the contract, the
contracting officer shall insert the clause at 48 CFR 952.247-70,
Foreign Travel.
PART 951--USE OF GOVERNMENT SOURCES BY CONTRACTORS
25. Subpart 951.70 is revised to read as follows:
Subpart 951.70--Contractor Employee Travel Discounts
951.7002 Responsibilities.
The contracting officer shall insert the clause at 952.251-70,
Contractor employee travel discounts, in all cost-reimbursable
solicitations and contracts when significant costs for rail travel, car
rental, or lodging will be required to perform the contract. The
contracting officer may furnish the contractor with appropriate
identification letters.
[[Page 81008]]
PART 952--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
26. Section 952.203-70 is added to read as follows:
952.203-70 Whistleblower Protection for Contractor Employees.
As prescribed in 48 CFR 903.971, insert the following clause:
Whistleblower Protection for Contractor Employees (DEC 2000)
(a) The contractor shall comply with the requirements of ``DOE
Contractor Employee Protection Program'' at 10 CFR part 708 for work
performed on behalf of DOE directly related to activities at DOE-
owned or -leased sites.
(b) The contractor shall insert or have inserted the substance
of this clause, including this paragraph (b), in subcontracts at all
tiers, for subcontracts involving work performed on behalf of DOE
directly related to activities at DOE-owned or leased sites.
(End of Clause)
27. Section 952.204-75 is added as follows:
952.204-75 Public Affairs.
As prescribed in 48 CFR 904.7201, insert the following clause.
Public Affairs (DEC 2000)
(a) The Contractor must cooperate with the Department in
releasing unclassified information to the public and news media
regarding DOE policies, programs, and activities relating to its
effort under the contract. The responsibilities under this clause
must be accomplished through coordination with the Contracting
Officer and appropriate DOE public affairs personnel in accordance
with procedures defined by the Contracting Officer.
(b) The Contractor is responsible for the development, planning,
and coordination of proactive approaches for the timely
dissemination of unclassified information regarding DOE activities
onsite and offsite, including, but not limited to, operations and
programs. Proactive public affairs programs may utilize a variety of
communication media, including public workshops, meetings or
hearings, open houses, newsletters, press releases, conferences,
audio/visual presentations, speeches, forums, tours, and other
appropriate stakeholder interactions.
(c) The Contractor's internal procedures must ensure that all
releases of information to the public and news media are coordinated
through, and approved by, a management official at an appropriate
level within the Contractor's organization.
(d) The Contractor must comply with DOE procedures for obtaining
advance clearances on oral, written, and audio/visual informational
material prepared for public dissemination or use.
(e) Unless prohibited by law, and in accordance with procedures
defined by the Contracting Officer, the Contractor must notify the
Contracting Officer and appropriate DOE public affairs personnel of
communications or contacts with Members of Congress relating to the
effort performed under the contract.
(f) In accordance with procedures defined by the Contracting
Officer, the Contractor must notify the Contracting Officer and
appropriate DOE public affairs personnel of activities or situations
that may attract regional or national news media attention and of
non-routine inquiries from national news media relating to the
effort performed under the contract.
(g) In releases of information to the public and news media, the
Contractor must fully and accurately identify the Contractor's
relationship to the Department and fully and accurately credit the
Department for its role in funding programs and projects resulting
in scientific, technical, and other achievements.
(End of Clause)
28. Section 952.215-70 is added as follows:
952.215-70 Key Personnel.
As prescribed in 48 CFR 915.408-70, the contracting officer shall
insert the following clause:
Key Personnel (DEC 2000)
(a) The personnel listed below or elsewhere in this contract
[Insert cross-reference, if applicable] are considered essential to
the work being performed under this contract. Before removing,
replacing, or diverting any of the listed or specified personnel,
the Contractor must: (1) Notify the Contracting Officer reasonably
in advance; (2) submit justification (including proposed
substitutions) in sufficient detail to permit evaluation of the
impact on this contract; and (3) obtain the Contracting Officer's
written approval. Notwithstanding the foregoing, if the Contractor
deems immediate removal or suspension of any member of its
management team is necessary to fulfill its obligation to maintain
satisfactory standards of employee competency, conduct, and
integrity under the clause at 48 CFR 970.5203-3, Contractor's
Organization, the Contractor may remove or suspend such person at
once, although the Contractor must notify Contracting Officer prior
to or concurrently with such action.
(b) The list of personnel may, with the consent of the
contracting parties, be amended from time to time during the course
of the contract to add or delete personnel.
[Insert List of Key Personnel unless listed elsewhere in the
contract]
(End of clause)
952.222-70 [Removed]
29. Section 952.222-70 is removed.
952.223-71 [Amended]
30. Section 952.223-71 is amended by revising ``970.5204-2'' to
read ``48 CFR 970.5223-1.''
31. Section 952.242-70 is added as follows:
952.242-70 Technical Direction.
As prescribed in 48 CFR 942.270-2, insert the following clause.
Technical Direction (DEC 2000)
(a) Performance of the work under this contract shall be subject
to the technical direction of the DOE Contracting Officer's
Representative (COR). The term ``technical direction'' is defined to
include, without limitation:
(1) Providing direction to the contractor that redirects
contract effort, shift work emphasis between work areas or tasks,
require pursuit of certain lines of inquiry, fill in details, or
otherwise serve to accomplish the contractual Statement of Work.
(2) Providing written information to the contractor that assists
in interpreting drawings, specifications, or technical portions of
the work description.
(3) Reviewing and, where required by the contract, approving,
technical reports, drawings, specifications, and technical
information to be delivered by the contractor to the Government.
(b) The contractor will receive a copy of the written COR
designation from the contracting officer. It will specify the extent
of the COR's authority to act on behalf of the contracting officer.
(c) Technical direction must be within the scope of work stated
in the contract. The COR does not have the authority to, and may
not, issue any technical direction that:
(1) Constitutes an assignment of additional work outside the
Statement of Work;
(2) Constitutes a change as defined in the contract clause
entitled ``Changes;''
(3) In any manner causes an increase or decrease in the total
estimated contract cost, the fee (if any), or the time required for
contract performance;
(4) Changes any of the expressed terms, conditions or
specifications of the contract; or
(5) Interferes with the contractor's right to perform the terms
and conditions of the contract.
(d) All technical direction shall be issued in writing by the
COR.
(e) The contractor must proceed promptly with the performance of
technical direction duly issued by the COR in the manner prescribed
by this clause and within its authority under the provisions of this
clause. If, in the opinion of the contractor, any instruction or
direction by the COR falls within one of the categories defined in
(c)(1) through (c)(5) of this clause, the contractor must not
proceed and must notify the Contracting Officer in writing within
five (5) working days after receipt of any such instruction or
direction and must request the Contracting Officer to modify the
contract accordingly. Upon receiving the notification from the
contractor, the Contracting Officer must:
(1) Advise the contractor in writing within thirty (30) days
after receipt of the contractor's letter that the technical
direction is within the scope of the contract effort and does not
constitute a change under the Changes clause of the contract;
(2) Advise the contractor in writing within a reasonable time
that the Government will issue a written change order; or
(3) Advise the contractor in writing within a reasonable time
not to proceed with the instruction or direction of the COR.
[[Page 81009]]
(f) A failure of the contractor and Contracting Officer either
to agree that the technical direction is within the scope of the
contract or to agree upon the contract action to be taken with
respect to the technical direction will be subject to the provisions
of the clause entitled ``Disputes.''
(End of Clause)
32. Section 952.247-70 is revised to read as follows:
952.247-70 Foreign travel.
As prescribed in 48 CFR 947.7002, insert the following clause:
Foreign Travel (DEC 2000)
Contractor foreign travel shall be conducted pursuant to the
requirements contained in DOE Order 551.1, Official Foreign Travel,
or any subsequent version of the order in effect at the time of
award.
(End of Clause)
952.250-70 [Amended]
33. Section 952.250-70 is amended in paragraph (h) by revising
``Audit and records--negotiation'', to read ``Accounts, records, and
inspection.''
34. Section 952.251-70 is revised to read as follows:
952.251-70 Contractor employee travel discounts.
As prescribed in 48 CFR 951.70, insert the following clause.
Contractor Employee Travel Discounts (DEC 2000)
(a) The contractor shall take advantage of travel discounts
offered to Federal contractor employee travelers by AMTRAK, hotels,
motels, or car rental companies, when use of such discounts would
result in lower overall trip costs and the discounted services are
reasonably available. Vendors providing these services may require
the contractor employee to furnish them a letter of identification
signed by the authorized contracting officer.
(b) Contracted airlines. Contractors are not eligible for GSA
contract city pair fares.
(c) Discount rail service. AMTRAK voluntarily offers discounts
to Federal travelers on official business and sometimes extends
those discounts to Federal contractor employees.
(d) Hotels/motels. Many lodging providers extend their discount
rates for Federal employees to Federal contractor employees.
(e) Car rentals. The Military Traffic Management Command (MTMC)
of the Department of Defense negotiates rate agreements with car
rental companies that are available to Federal travelers on official
business. Some car rental companies extend those discounts to
Federal contractor employees.
(f) Obtaining travel discounts.
(1) To determine which vendors offer discounts to Government
contractors, the contractor may review commercial publications such
as the Official Airline guides Official Traveler, Innovata, or
National Telecommunications. The contractor may also obtain this
information from GSA contract Travel Management Centers or the
Department of Defense's Commercial Travel Offices.
(2) The vendor providing the service may require the Government
contractor to furnish a letter signed by the contracting officer.
The following illustrates a standard letter of identification.
OFFICIAL AGENCY LETTERHEAD
TO: Participating Vendor
SUBJECT: OFFICIAL TRAVEL OF GOVERNMENT CONTRACTOR
(FULL NAME OF TRAVELER), the bearer of this letter is an employee of
(COMPANY NAME) which has a contract with this agency under
Government contract (CONTRACT NUMBER). During the period of the
contract (GIVE DATES), AND WITH THE APPROVAL OF THE CONTRACT VENDOR,
the employee is eligible and authorized to use available travel
discount rates in accordance with Government contracts and/or
agreements. Government Contract City Pair fares are not available to
Contractors.
SIGNATURE, Title and telephone number of Contracting Officer
35. The authority citation for Part 970 continues to read as
follows:
Authority: Sec. 161 of the Atomic Energy Act of 1954 (42 U.S.C.
2201), sec. 644 of the Department of Energy Organization Act (42
U.S.C. 7101, et seq.), National Nuclear Security Agency (50 U.S.C.
2401 et seq.)
36. Part 970 is revised to read as follows:
PART 970--DOE MANAGEMENT AND OPERATING CONTRACTS
Sec.
Subpart 970.01--Management and Operating Contract Regulatory System
970.0100 Scope of part.
970.0103 Publication and codification.
Subpart 970.03--Improper Business Practices and Personal Conflicts of
Interest
970.0309 Whistleblower protection of contractor employees.
970.0309-1 Applicability.
970.0370 Management controls and improvements.
970.0370-1 Policy.
970.0370-2 Contract clause.
970.0371 Conduct of employees of DOE management and operating
contractors.
970.0371-1 Scope of section.
970.0371-2 Applicability.
970.0371-3 Definition.
970.0371-4 Gratuities.
970.0371-5 Use of privileged information.
970.0371-6 Incompatibility between regular duties and private
interests.
970.0371-7 Outside employment of contractor employees.
970.0371-8 Employee disclosure concerning other employment
services.
970.0371-9 Contract clause.
Subpart 970.04--Administrative Matters
970.0404 Safeguarding classified information.
970.0404-1 Definitions.
970.0404-2 General.
970.0404-3 Responsibilities of contracting officers.
970.0404-4 Solicitation provision and contract clauses.
970.0407 Contractor records retention.
970.0407-1 Applicability.
970.0407-1-1 Alternate retention schedules.
970.0407-1-2 Access to and ownership of records.
970.0407-1-3 Contract clause.
970.0470 Department of Energy Directives.
970.0470-1 General.
970.0470-2 Contract clause.
Subpart 970.08--Required Sources of Supplies and Services
970.0801 Excess personal property.
970.0801-1 Policy.
970.0808 Acquisition of printing.
970.0808-1 Scope of section.
970.0808-2 Policy.
970.0808-3 Contract clause.
Subpart 970.09--Contractor Qualifications
970.0905 Organizational conflicts of interest.
970.0970 Performance guarantees.
970.0970-1 Determination of responsibility.
970.0970-2 Solicitation provision.
Subpart 970.11--Describing Agency Needs
970.1100 Policy.
970.1100-1 Performance-based contracting.
970.1100-2 Additional considerations.
970.1103-4 Contract clause.
Subpart 970.15--Contracting by Negotiation
970.1504 Contract pricing.
970.1504-1 Price analysis
970.1504-1-1 Fees for management and operating contracts.
970.1504-1-2 Fee policy.
970.1504-1-3 Special considerations: Laboratory management and
operation.
970.1504-1-4 Types of contracts and fee arrangements.
970.1504-1-5 General considerations and techniques for determining
fixed fees.
970.1504-1-6 Calculating fixed fee.
970.1504-1-7 Fee base.
970.1504-1-8 Special equipment purchases.
970.1504-1-9 Special considerations: Cost-plus-award-fee.
970.1504-1-10 Special considerations: Fee limitations.
970.1504-1-11 Documentation.
970.1504-2 Price negotiation.
970.1504-3 Documentation.
970.1504-3-1 Cost or pricing data.
970.1504-4 Special cost or pricing areas.
970.1504-4-1 Make-or-buy plans.
970.1504-4-2 Policy.
970.1504-4-3 Requirements.
970.1504-5 Solicitation provision contract clauses.
Subpart 970.17--Special Contracting Methods
970.1706 Management and operating contracts.
[[Page 81010]]
970.1706-1 Award, renewal, and extension.
970.1706-2 Contract clause.
Subpart 970.19--Small, Small Disadvantaged and Women-Owned Small
Business Concerns
970.1907 Subcontracting with Small Business, Small Disadvantaged
Business and Woman-owned Small Business Concerns.
970.1907-1 Subcontracting plan requirements.
Subpart 970.22--Application of Labor Policies
970.2200 Scope of subpart.
970.2201 Basic labor policies.
970.2201-1 Labor relations.
970.2201-1-1 General.
970.2201-1-2 Policies.
970.2201-1-3 Contract clause.
970.2201-2 Overtime management.
970.2201-2-1 Policy.
970.2201-2-2 Contract clause.
970.2204 Labor standards for contracts involving construction.
970.2204-1 Statutory and regulatory requirements.
970.2204-1-1 Administrative controls and criteria for application
of the Davis-Bacon Act in operational or maintenance activities.
970.2208 Equal Employment Opportunity.
970.2210 Service contract act.
970.2270 Unemployment compensation.
Subpart 970.23--Environmental, Conservation, and Occupational Safety
Programs
970.2303 Hazardous materials identification and material safety.
970.2303-1 General.
970.2303-2 Contract clauses.
970.2304 Use of recovered/recycled materials.
970.2304-1 General.
970.2304-2 Contract clause.
970.2305 Workplace substance abuse programs--Management and
operating contracts.
970.2305-1 General.
970.2305-2 Applicability.
970.2305-3 Definitions.
970.2305-4 Solicitation provision and contract clause.
970.2306 Suspension of payments, termination of contract, and
debarment and suspension actions.
Subpart 970.26--Other Socioeconomic Programs
970.2670 Implementation of Section 3021 of the Energy Policy Act
of 1992.
970.2670-1 Requirements.
970.2671 Diversity.
970.2671-1 Policy.
970.2671-2 Contract clause.
970.2672 Implementation of Section 3161 of the National Defense
Authorization Act for Fiscal Year 1993.
970.2672-1 Policy.
970.2672-2 Requirements.
970.2672-3 Contract clause.
970.2673 Regional partnerships.
970.2673-1 Policy.
970.2673-2 Contract clause.
Subpart 970.27--Patents, Data, and Copyrights
970.2701 General.
970.2701-1 Applicability.
970.2702 Patent related clauses.
970.2702-1 Authorization and consent.
970.2702-2 Notice and assistance regarding patent and copyright
infringement.
970.2702-3 Patent indemnity.
970.2702-4 Royalties.
970.2702-5 Rights to proposal data.
970.2702-6 Notice of right to request patent waiver.
970.2703 Patent rights.
970.2703-1 Purposes of patent rights clauses.
970.2703-2 Patent rights clause provisions for management and
operating contractors.
970.2704 Rights in data.
970.2704-1 General.
970.2704-2 Procedures.
970.2704-3 Contract clauses.
970.2770 Technology transfer.
970.2770-1 General.
970.2770-2 Policy.
970.2770-3 Technology transfer and patent rights.
970.2770-4 Contract clause.
Subpart 970.28--Bonds and Insurance
970.2803 Insurance.
970.2803-1 Workers' compensation insurance.
970.2803-2 Contract clause.
Subpart 970.29--Taxes
970.2902 Federal excise taxes.
970.2902-1 Exemptions from federal excise taxes.
970.2903 State and local taxes.
970.2903-1 Applicability of state and local taxes to the
Government.
970.2904 Contract clauses.
970.2904-1 Management and operating contracts.
Subpart 970.30--Cost Accounting Standards
970.3002 CAS Program Requirements.
970.3002-1 Applicability.
Subpart 970.31--Contract Cost Principles and Procedures
970.3101-00-70 Scope of subpart.
970.3101-9 Advance agreements.
970.3101-10 Cost certification.
970.3102-3-70 Home office expenses
970.3102-05 Application of cost principles.
970.3102-05-4 Bonding costs.
970.3102-05-6 Compensation for personal services.
970.3102-05-18 Independent research and development and bid and
proposal costs.
970.3102-05-19 Insurance and indemnification.
970.3102-05-22 Lobbying and political activity costs.
970.3102-05-28 Other business expenses.
970.3102-05-30 Patent costs and technology transfer costs.
970.3102-05-46 Travel costs.
970.3102-05-47 Costs related to legal and other proceedings.
970.3102-05-53 Preexisting conditions.
970.3170 Contract clause.
Subpart 970.32--Contract Financing
970.3200 Policy.
970.3200-1 Reduction or suspension of advance, partial, or
progress payments.
970.3200-1-1 Contract clause.
970.3204 Advance payments.
970.3204-1 Applicability.
970.3270 Standard financial management clauses.
Subpart 970.34--Major System Acquisition
970.3400 General requirements.
970.3400-1 Mission-oriented solicitation.
Subpart 970.35--Research and Development Contracting
970.3500 Scope of subpart.
970.3501 Federally funded research and development centers.
970.3501-1 Sponsoring agreements.
970.3501-2 Using an FFRDC.
970.3501-3 Reviewing FFRDC's.
970.3501-4 Contract Clause.
Subpart 970.36--Construction and Architect-Engineer Contracts.
970.3605 Contract clauses.
970.3605-1 Other contracts.
970.3605-2 Special construction clause for operating contracts.
Subpart 970.37--Facilities Management Contracting
970.3770 Facilities management.
970.3770-1 Policy.
970.3770-2 Contract clause.
Subpart 970.41--Acquisition of Utility Services
970.4102 Acquiring utility services.
970.4102-1 Policy.
Subpart 970.42--Contract Administration
970.4207-03-02 Certificate of costs.
970.4207-03-70 Contract clause.
970.4207-05-01 Contracting officer determination procedure.
Subpart 970.43--Contract Modifications
970.4302 Changes.
970.4302-1 Contract Clause.
Subpart 970.44--Management and Operating Contractor Purchasing
970.4400 Scope.
970.4401 Responsibilities.
970.4401-1 General.
970.4401-2 Review and approval.
970.4401-3 Advance notification.
970.4402 Contractor purchasing system.
970.4402-1 Policy.
970.4402-2 General requirements.
970.4402-3 Purchasing from contractor-affiliated sources.
970.4402-4 Nuclear material transfers.
970.4403 Contract clause.
Subpart 970.45--Government Property
970.4501 General.
970.4501-1 Contract clause.
Subpart 970.49--Termination of Contracts
970.4905 Contract termination clause.
970.4905-1 Termination for convenience of the government and
default.
[[Page 81011]]
Subpart 970.50--Extraordinary Contractual Actions
970.5004 Residual powers.
970.5004-1 Contract clause.
970.5070 Indemnification.
970.5070-1 Scope and applicability.
970.5070-2 General.
970.5070-3 Contract clauses.
Subpart 970.52--Solicitation Provisions and Contract Clauses for
Management and Operating Contracts
970.5200 Scope of subpart.
970.5201 Text of provisions and clauses.
970.5203-1 Management controls.
970.5203-2 Performance improvement and collaboration.
970.5203-3 Contractor's organization.
970.5204-1 Counterintelligence.
970.5204-2 Laws, regulations, and DOE directives.
970.5204-3 Access to and ownership of records.
970.5208-1 Printing.
970.5209-1 Requirement for guarantee of performance.
970.5215-1 Total Available Fee: Base fee amount and performance
fee amount.
970.5215-2 Make-or-Buy Plan.
970.5215-3 Conditional payment of fee, profit, or incentives.
970.5215-4 Cost reduction.
970.5215-5 Limitation on fee.
970.5222-1 Collective bargaining agreements--management and
operating contracts.
970.5222-2 Overtime management.
970.5223-1 Integration of environment, safety, and health into
work planning and execution.
970.5223-2 Acquisition and use of environmentally preferable
products and services.
970.5223-3 Agreement regarding workplace substance abuse programs
at DOE facilities.
970.5223-4 Workplace Substance Abuse Programs at DOE sites.
970.5226-1 Diversity plan.
970.5226-2 Workforce restructuring under Section 3161 of the
National Defense Authorization Act for Fiscal Year 1993.
970.5226-3 Community commitment.
970.5227-1 Rights in data--facilities.
970.5227-2 Rights in data--technology transfer.
970.5227-3 Technology transfer mission.
970.5227-4 Authorization and consent.
970.5227-5 Notice and assistance regarding patent and copyright
infringement.
970.5227-6 Patent indemnity--subcontracts.
970.5227-7 Royalty information.
970.5227-8 Refund of royalties.
970.5227-9 Notice of right to request patent waiver.
970.5227-10 Patent rights--management and operating contracts,
nonprofit organization or small business firm contractor.
970.5227-11 Patent rights--management and operating contracts,
for-profit contractor, non-technology transfer.
970.5227-12 Patent rights--management and operating contracts,
for-profit contractor, advance class waiver.
970.5228-1 Insurance--Litigation and claims.
970.5229-1 State and local taxes.
970.5231-4 Preexisting conditions.
970.5232-1 Reduction or suspension of advance, partial, or
progress payments upon finding of substantial evidence of fraud.
970.5232-2 Payments and advances.
970.5232-3 Accounts, records, and inspection.
970.5232-4 Obligation of funds.
970.5232-5 Liability with respect to cost accounting standards.
970.5232-6 Work for others funding authorization.
970.5232-7 Financial management system.
970.5232-8 Integrated accounting.
970.5235-1 Federally funded research and development center
sponsoring agreement.
970.5236-1 Government facility subcontract approval.
970.5237-2 Facilities management.
970.5242-1 Penalties for unallowable costs.
970.5243-1 Changes.
970.5244-1 Contractor purchasing system.
970.5245-1 Property.
Subpart 970.01--Management and Operating Contract Regulatory System
970.0100 Scope of part.
This part provides Departmental policies, procedures, provisions,
and clauses that implement and supplement the Federal Acquisition
Regulation (FAR) and other parts of the Department of Energy
Acquisition Regulation (DEAR) for the award and administration of the
Department's management and operating contracts, as defined at 48 CFR
subpart 17.6. The FAR and other parts of the DEAR apply to management
and operating contracts. See 48 CFR 970.5200 for guidance regarding
which provisions and clauses (from FAR, DEAR Part 970, or other parts
of the DEAR) to include in management and operating contracts.
970.0103 Publication and codification.
(a) Organization of Part 970. (1) To the extent possible, the
titles and text of the subparts, sections, and subsections of this part
are numbered to correspond with related material that is contained in
the FAR.
(2) The number to the left of the decimal point represents the DEAR
part number (i.e., 970). The numbers to the right of the decimal point
and to the left of the dash represent, in order, the DEAR subpart
(first two digits), and the DEAR section number (second two digits).
The numbers to the right of the dash represent the DEAR subsection. A
second dash may follow the DEAR subsection number. As applicable,
numbers to the right of the second dash represent subordinate
subsections.
(3) To the extent practicable, the subpart number corresponds with
the FAR part which contains related coverage, and the section number
corresponds with the FAR subpart which contains related coverage (e.g.,
the coverage contained in DEAR 970.0309 corresponds with material
contained in FAR 3.9).
(4) Where the FAR does not contain related coverage on a particular
subject, the DEAR section number will be numbered using numbers of 70
and up (e.g., 970.0370).
(b) Special Note Regarding Clause Numbering. The section number for
clauses prescribed in part 970 are numbered to correspond with the
subpart in which the clause is prescribed (e.g., 970.5203-1 is
prescribed for use at subpart 970.03).
Subpart 970.03--Improper Business Practices and Personal Conflicts
of Interest
970.0309 Whistleblower Protection of Contractor Employees.
970.0309-1 Applicability.
The contracting officer shall refer to 48 CFR subpart 903.9
regarding the applicability of the DOE Employee Protection Program to
management and operating contracts.
970.0370 Management Controls and Improvements.
970.0370-1 Policy.
(a) Management and operating contractors shall develop and maintain
systems of management and quality control to discourage waste, fraud
and abuse; and to ensure that components, products, and services that
are provided to DOE satisfy the contractor's obligations under the
contract.
(b) As a part of the required overall management structure, the
contractor must maintain management control systems which, in
compliance with the requirements of the clause at 48 CFR 970.5203-1:
(1) Are documented and satisfactory to DOE;
(2) Ensure that all levels of management are accountable for
effective management systems and internal controls within their areas
of assigned responsibility;
(3) Cover both programmatic and administrative functions;
(4) Provide reasonable assurance that Government resources are
safeguarded against theft, fraud, waste, and unauthorized use;
(5) Promote efficient and effective operations;
(6) Ensure that all obligations and costs incurred are in
compliance with
[[Page 81012]]
the intended purposes and the terms and conditions of the contract;
(7) Properly record, manage, and report all revenues, expenditures,
transactions and assets;
(8) Maintain financial, statistical and other reports necessary to
maintain accurate, reliable, and timely accountability and management
controls;
(9) Are periodically reviewed to ensure that the systems provide
reasonable assurance that the objectives of the system are being
accomplished and that these controls are working effectively;
(10) Are in accordance with the Comptroller General's standards for
internal controls, as set forth in the General Accounting Office Policy
and Procedures Manual For Guidance To Federal Agencies, (Oct 1984), as
amended.
(c) Management and operating contractors shall also develop and
maintain a baseline program of quality assurance that will implement
documented performance and quality standards, and management controls
and assessment techniques to ensure components, services, and products
meet DOE's, design criteria and other governing and applicable
specifications.
(d) DOE expects all its contractors to seek to identify
improvements in any aspect of performance. Management and operating
contracts are very large and complex; therefore, the opportunities to
identify changes in performance that will increase the effectiveness or
efficiency of contract performance are more prevalent than under other
contracts. The clause at 48 CFR 970.5203-2 requires DOE management and
operating contractors to affirmatively seek to identify, evaluate, and
institute, where appropriate, processes that will improve the
effectiveness or efficiency of any aspect of contract performance. It
further requires the contractor to communicate any such improvements to
DOE, other management and operating contractors, and DOE major
facilities contractors. The contractor is required to participate in
efforts by those contractors to address common problems or the
institution of improvements. It allows the contractor to enlist the aid
of the DOE contracting officer where necessary to institute or
communicate the improvements. The obligations under the clause in no
way affect the contractor's obligations under other provisions of the
contract to notify or acquire the approval of the contracting officer.
970.0370-2 Contract clause.
(a) The contracting officer shall insert the clause at 970.5203-1,
Management Controls, in all management and operating contracts.
(b) The contracting officer shall insert the clause at 970.5203-2,
Performance Improvement and Collaboration, in all management and
operating contracts.
970.0371 Conduct of employees of DOE management and operating
contractors.
970.0371-1 Scope of section.
This section establishes the policies for maintaining satisfactory
standards of conduct on the part of individuals employed by DOE
management and operating contractors.
970.0371-2 Applicability.
The policies in this section are applicable to all DOE management
and operating contractors.
970.0371-3 Definition.
Employees, as used in this section, are defined to mean individuals
employed by the contractor, both full and part-time, who are assigned
to work under a DOE management and operating contract.
970.0371-4 Gratuities.
Employees of a management and operating contractor shall not, under
circumstances which might reasonably be interpreted as an attempt to
influence the recipients in the conduct of their duties, accept any
gratuity or special favor from individuals or organizations with whom
the contractor is doing business, or proposing to do business, in
accomplishing the work under the contract. Reference is made to the
requirements prescribed in 48 CFR 3.502.
970.0371-5 Use of privileged information.
Management and operating contractor employees shall not use
privileged information for personal gain, or make other improper use of
privileged information which is acquired in connection with their
employment on contract work. For the purposes of this subsection, the
term ``privileged information'' includes but is not limited to,
unpublished information relating to technological and scientific
developments; medical, personnel, or security records of individuals;
anticipated materials' requirements or pricing action; possible new
sites for DOE program operations; internal DOE decisions; policy
development; and knowledge of selections of contractors or
subcontractors in advance of official announcement.
970.0371-6 Incompatibility between regular duties and private
interests.
(a) Employees of a management and operating contractor shall not be
permitted to make or influence any decisions on behalf of the
contractor which directly or indirectly affect the interest of the
Government, if the employee's personal concern in the matter may be
incompatible with the interest of the Government. For example: An
employee of a contractor will not negotiate, or influence the award of,
a subcontract with a company in which the individual has an employment
relationship or significant financial interest; and an employee of a
contractor will not be assigned the preparation of an evaluation for
DOE or for any DOE contractor of some technical aspect of the work of
another organization with which the individual has an employment
relationship, or significant financial interest, or which is a
competitor of an organization (other than the contractor who is the
individual's regular employer) in which the individual has an
employment relationship or significant financial interest.
(b) The contractor shall be responsible for informing employees
that they are expected to disclose any incompatibilities between duties
performed for the contractor and their private interests and to refer
undecided questions to the contractor.
970.0371-7 Outside employment of contractor employees.
Employees of a management and operating contractor are entitled to
the same rights and privileges with respect to outside employment as
other citizens. Therefore, there is no general prohibition against
contractor employees having outside employment. However, no employee of
a contractor performing work on a full or part-time basis under a DOE
management and operating contract may engage in employment outside
official hours of duty or while on leave if such employment will:
(a) In any manner interfere with the proper and effective
performance of the duties of the position;
(b) Appear to create a conflict-of-interest situation, or
(c) Appear to subject DOE or the contractor to public criticism or
embarrassment.
970.0371-8 Employee disclosure concerning other employment services.
(a) Management and operating contractors are responsible for
requiring its employees to file with the contractor, a written
disclosure statement
[[Page 81013]]
concerning outside employment services which involve the use of
information in the area of the employee's employment with the
contractor. The disclosure shall contain such information concerning
the outside employment as the contractor may prescribe. As a minimum,
the employee's disclosure shall:
(1) Acknowledge that the employee has read and is familiar with:
(i) The requirements and restrictions prescribed in this section,
(ii) DOE publication entitled, ``Reporting Results of Scientific
and Technical Work Funded by DOE'', and
(iii) The requirements of the contractor's contract with DOE
relating to patents.
(2) Include information concerning any rate of remuneration
significantly in excess of the employee's regular rate of remuneration;
(3) Identify any actual or potential conflicts with DOE's policies
regarding conduct of employees of DOE's contractors set forth in this
section;
(4) Address any potential impacts that such employment may have on
the contractor's responsibility to report fully and promptly to DOE all
significant research and development information; and
(5) Identify any potential conflicts such employment may have with
the patent provisions of the contractor's contract with DOE.
(b) The contractor shall provide a copy of all disclosures to the
contracting officer.
970.0371-9 Contract clause.
The contracting officer shall insert the clause at 970.5203-3,
Contractor's Organization, in all management and operating contracts.
The approval authority of the Secretary of Energy required in paragraph
(c) may not be delegated. In paragraph (a) the words ``and managerial
personnel (see 48 CFR 970.5245-1(j))'' may be inserted after ``(see 48
CFR 952.215-70)''.
Subpart 970.04--Administrative Matters
970.0404 Safeguarding classified information.
970.0404-1 Definitions.
Classified Information means any information or material that is
owned by or produced for, or is under the control of the United States
Government, and determined pursuant to provisions of Executive Order
12356 of April 2, 1982 (3 CFR, 1982 Comp., p. 166), or prior orders, or
as authorized under the Atomic Energy Act of 1954, as amended, to
require protection against unauthorized disclosure, and is so
designated.
Counterintelligence means information gathered and activities
conducted to protect against espionage, other intelligence activities,
sabotage, or assassinations conducted for or on behalf of foreign
powers, organizations or persons, or international terrorist
activities, but not including personnel, physical, document or
communication security programs.
Restricted data means data which is defined, in section 11, of the
Atomic Energy Act of 1954, as amended, as ``all data concerning:
(1) Design, manufacture, or utilization of atomic weapons;
(2) The production of special nuclear material; or
(3) The use of special nuclear material in the production of
energy, but shall not include data declassified or removed from the
Restricted Data category pursuant to section 142.''
970.0404-2 General.
(a) The basis of DOE's security requirements is the Atomic Energy
Act of 1954, as amended.
(b) DOE regulations concerning national security information are
codified at 10 CFR parts 1045 and 710. Supplemental security material
is found in the DOE Directives system. Foreign ownership, control, or
influence over contractors as it relates to security is discussed at 48
CFR 904.70 also applies to management and operating contracts.
Regulations pertaining to the protection of restricted data are found
under 10 CFR part 1016.
(c) Statutory requirements to be observed in connection with the
release of Restricted Data to foreign governments are contained in the
Atomic Energy Act of 1954, Sections 141 and 144 (42 U.S.C. 2161 and
2164).
(d) Section 148 of the Atomic Energy Act (42 U.S.C. 2168) prohibits
the unauthorized dissemination of unclassified nuclear information with
respect to the atomic energy defense programs pertaining to:
(1) The design of production facilities or utilization facilities;
(2) Security measures (including security plans, procedures, and
equipment) for the physical protection of:
(i) Production or utilization facilities,
(ii) Nuclear material contained in such facilities, or
(iii) Nuclear materials in transit; or
(3) The design, manufacture, or utilization of any atomic weapon or
component if the design, manufacture, or utilization of such weapon or
component was contained in any information declassified or removed from
the Restricted Data category pursuant to section 142 of the Atomic
Energy Act (42 U.S.C. 2162).
(e) Executive Order 12333, United States Intelligence Activities,
provides for the organization and control of United States foreign
intelligence and counterintelligence activities. In accordance with
this Executive Order, DOE has established a counterintelligence program
which is described in DOE Order 5670.3 (as amended). All DOE elements,
including management and operating contractors and other contractors
managing DOE-owned facilities which require access authorizations,
should undertake the necessary precautions to ensure that DOE and
covered contractor personnel, programs and resources are properly
protected from foreign intelligence threats and activities.
970.0404-3 Responsibilities of contracting officers.
(a) If access to Restricted Data may be required during the
solicitation process for a management and operating contract, security
clearances shall be obtained in accordance with applicable DOE
Directives in the safeguards and security series.
(b) Management and operating contracts which may require the
processing or storage of Restricted Data or Special Nuclear Material
require application of the applicable DOE Directives in the safeguards
and security series.
(c) The contracting officer shall refer to 48 CFR 904.71 for
guidance concerning the prohibition on award of a DOE contract under a
national security program to a company owned by an entity controlled by
a foreign government when access to proscribed information is required
to perform the contract.
970.0404-4 Solicitation provision and contract clauses.
(a) The contracting officer shall insert the clause at 970.5204-1,
Counterintelligence, into all management and operating contracts and
other contracts for the management of DOE-owned facilities which
include the security and classification/declassification clauses.
(b) The contracting officer shall refer to 48 CFR 904.404 and 48
CFR 904.7103 for the prescription of solicitation provisions and
contract clauses relating to safeguarding classified information and
foreign ownership, control, or influence over contractors.
[[Page 81014]]
970.0407 Contractor records retention.
970.0407-1 Applicability.
970.0407-1-1 Alternate retention schedules.
Records produced under the Department's contracts involving
management and operation responsibilities relative to DOE-owned or -
leased facilities are to be retained and disposed of in accordance with
the guidance contained in DOE G 1324.5B, Records Management Program and
DOE Records Schedules (see current version), rather than those set
forth at 48 CFR subpart 4.7, Contractor Records Retention.
970.0407-1-2 Access to and ownership of records.
Contracting officers may agree to contractor ownership of certain
categories of records designated in the instruction contained in
paragraph (b) of the clause at 48 CFR 970.5204-3, Access to and
Ownership of Records, provided the Government's rights to inspect,
copy, and audit these records are not limited. These rights must be
retained by the Government in order to carry out the Department's
statutory responsibilities required by the Atomic Energy Act and other
statutes for oversight of its contractors, including compliance with
the Department's health, safety and reporting requirements, and
protection of the public interest.
970.0407-1-3 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5204-
3, Access to and Ownership of Records, in management and operating
contracts.
970.0470 Department of Energy Directives.
970.0470-1 General.
(a) The contractor is required to comply with the requirements of
applicable Federal, State and local laws and regulations, unless relief
has been granted by the appropriate authority. For informational
purposes, the contracting officer may append the contract with a list
of applicable laws or regulations (see 970.5204-2, Laws, Regulations,
and DOE Directives, paragraph (a)).
(b) The Department of Energy Directives System is a system of
instructions, including orders, notices, manuals, guides, and
standards, for Departmental elements. In certain circumstances,
requirements contained in these directives may apply to a contractor
through operation of a contract clause. Program and requirements
personnel are responsible for identifying requirements in the
Directives System which are applicable to a contract, and for
developing a list of applicable requirements and providing it to the
contracting officer for inclusion in the contract.
(c) Where directives requirements are established using either the
Standards/Requirements Identification Process or the Work Smart
Standards Process, the applicable process should also be used to
establish the environment, safety, and health portion of the list
identified in paragraph (b) of this section.
(d) Environmental, safety, and health (ES&H) requirements
appropriate for work conducted under a management and operating
contract may be determined by a DOE approved process to evaluate the
work and the associated hazards, and identify an appropriately tailored
set of standards, practices, and controls, such as a tailoring process
included in a DOE approved Safety Management System implemented under
48 CFR 970.5223-1, Integration of Environment, Safety, and Health into
Work Planning and Execution. When such a process is used, the
contracting officer shall ensure that the set of tailored requirements,
as approved by DOE pursuant to the process, is incorporated into the
list identified in paragraph (b) of this section. These requirements
shall supersede, in whole or in part, the contractual environmental,
safety, and health requirements previously made applicable to the
contract by List B. If the tailored set of requirements identifies an
alternative requirement which varies from an ES&H requirement of an
otherwise applicable law or regulation, the contractor must request an
exemption or other appropriate regulatory relief that may be specified
in the governing regulation.
970.0470-2 Contract clause.
The contracting officer shall insert the clause at DEAR 970.5204-2,
Laws, Regulations, and DOE Directives, in management and operating
contracts. The contracting officer may modify the clause to indicate
the location in the contract of List A, List B, or both.
Subpart 970.08--Required sources of supplies and services
970.0801 Excess personal property.
970.0801-1 Policy.
The provisions of 48 CFR subpart 8.1 (Federal Acquisition
Regulation), 41 CFR 101-43 (Federal Property Management Regulation),
and 41 CFR 109-43 (DOE Property Management Regulation) apply to DOE's
management and operating contracts.
970.0808 Acquisition of printing.
970.0808-1 Scope of section.
This section prescribes the Department's policy concerning
duplicating or printing services which may be required in the
performance of management and operating contracts.
970.0808-2 Policy.
Management and operating contractors shall provide or secure
duplication and printing services in accordance with the Government
Printing and Binding Regulations, Title 44 of the U.S. Code, and
applicable DOE Directives.
970.0808-3 Contract clause.
The contracting officer shall insert the clause at 970.5208-1,
Printing, in all management and operating contracts.
Subpart 970.09--Contractor qualifications
970.0905 Organizational conflicts of interest.
Management and operating contracts shall contain an organizational
conflict of interest clause substantially similar to the clause at 48
CFR 952.209-72, Organizational Conflicts of Interest, and which is
appropriate to the statement of work of the individual contract. In
addition, the contracting officer shall assure that the clause contains
appropriate restraints on intra-corporate relations between the
contractor's organization and personnel operating the Department's
facility and its parent corporate body and affiliates. Such restraints
shall include personnel access to the facility, technical transfer of
information from the facility, and the availability from the facility
of other advantages flowing from performance of the contract. The
contracting officer is responsible for ensuring that M&O contractors
adopt policies and procedures in the award of subcontracts that will
meet the Department's need to safeguard against a biased work product
and an unfair competitive advantage. To this end, the organizational
conflicts of interest clause in management and operating contracts
shall include Alternate I.
970.0970 Performance guarantees.
970.0970-1 Determination of responsibility.
(a) In the award of a management and operating contract, the
contracting officer shall determine that the prospective contractor is
a responsible contractor and is capable of providing all necessary
financial, personnel, and other resources in performance of the
contract.
[[Page 81015]]
(b) DOE contracts with entities that have been created solely for
the purpose of performing a specific management and operating contract.
Generally, such newly created entities will have very limited financial
and other resources. In such instances, when making the determination
of responsibility required under this section, the contracting officer
may evaluate the financial resources of other entities only to the
extent that those entities are legally bound, jointly and severally if
more than one, by means of a performance guarantee or other equivalent
enforceable commitment to supply the necessary resources to the
prospective contractor and to assume all contractual obligations of the
prospective contractor. A performance guarantee should be the means
used unless an equivalent degree of commitment can be obtained by an
alternative means.
(c) The guaranteeing corporate entity(ies) must be found to have
sufficient resources in order to satisfy its guarantee.
970.0970-2 Solicitation provision.
The contracting officer shall insert the provision at 48 CFR
970.5209-1, Requirement for Guarantee of Performance, in solicitations
when the awardee will be required to be organized solely for
performance of the requirement.
Subpart 970.11--Describing Agency Needs
970.1100 Policy.
970.1100-1 Performance-based contracting.
(a) It is the policy of the Department of Energy to use, to the
maximum extent practicable, performance-based contracting methods in
its management and operating contracts. Office of Federal Procurement
Policy Letter 91-2 provides guidance concerning the development and use
of performance-based contracting concepts and methodologies that may be
generally applied to management and operating contracts. Performance-
based contracts: Describe performance requirements in terms of results
rather than methods of accomplishing the work; use measurable (i.e.,
terms of quality, timeliness, quantity) performance standards and
objectives and quality assurance surveillance plans; provide
performance incentives (positive or negative) where appropriate; and
specify procedures for award or incentive fee reduction when work
activities are not performed or do not meet contract requirements.
(b) The use of performance-based statements of work, where
feasible, is the preferred method for establishing work requirements.
Such statements of work and other documents used to establish work
requirements (such as work authorization directives) should describe
performance requirements and expectations in terms of outcome, results,
or final work products, as opposed to methods, processes, or design.
(c) Contract performance requirements and expectations should be
consistent with the Department's strategic planning goals and
objectives, as made applicable to the site or facility through
Departmental programmatic and financial planning processes. Measurable
performance criteria, objective measures, and where appropriate,
performance incentives, shall be structured to correspond to the
performance requirements established in the statement of work and other
documents used to establish work requirements.
(d) Quality assurance surveillance plans shall be developed to
facilitate the assessment of contractor performance and ensure the
appropriateness of any award or incentive fee payment. Such plans shall
be tailored to the contract performance objectives, criteria, and
measures, and shall, to the maximum extent practicable, focus on the
level of performance required by the performance objectives rather than
the methodology used by the contractor to achieve that level of
performance.
970.1100-2 Additional considerations.
(a) While it is not feasible to set forth standard language which
would apply to every contract situation, language must be designed for
inclusion in a management and operating contract to describe clearly
the work being undertaken; the controls, as appropriate, to be
exercised by DOE over the performance of that work; and the
relationship contemplated between the parties.
(b) The language shall also include the following with respect to
subcontracting performance of the work described pursuant to paragraph
(a) of this section: ``The contractor shall, when directed by DOE and
may, but only when authorized by DOE, enter into subcontracts for the
performance of any part of the work under this clause.''
(c) The provisions required in paragraphs (a) and (b) of this
section shall be set forth in the statement of work of the contract.
970.1103-4 Contract clause.
Insert the clause at 48 CFR 52.211-5, Material Requirements, in
solicitations and contracts.
Subpart 970.15--Contracting by Negotiation
970.1504 Contract pricing.
970.1504-1 Price analysis.
970.1504-1-1 Fees for management and operating contracts.
This subsection sets forth the Department's policies on fees for
management and operating contracts and may be applied to other
contracts as determined by the Procurement Executive, or designee.
970.1504-1-2 Fee policy.
(a) DOE management and operating contractors may be paid a fee in
accordance with the requirements of this subsection.
(b) There are three basic principles underlying the Department's
fee policy:
(1) The amount of available fee should reflect the financial risk
assumed by the contractor.
(2) It is the policy of the Department, when work elements cannot
be fixed price, incentive fees (including award fees) tied to objective
measures should be used to the maximum extent appropriate.
(3) When work elements cannot be fixed price and award fees are
employed, they should be tied to either objective or subjective
measures. Each measure should, to the maximum extent appropriate, be
directly tied to a specific portion of the fee pool.
(c) Fee objectives and amounts are to be determined for each
contract. Standard fees or across-the-board fee agreements will not be
used or made. Due to the nature of funding management and operating
contracts, it is anticipated that fee shall be established in
accordance with the annual funding cycle; however, with the prior
approval of the Procurement Executive, or designee, a longer period may
be used where necessary to incentivize performance objectives that span
funding cycles or to optimize cost reduction efforts.
(d) Annual fee amounts shall be established in accordance with this
subsection. Annual amounts shall not exceed maximum amounts derived
from the appropriate fee schedule (and Classification Factor, if
applicable) unless approved in advance by the Procurement Executive, or
designee. In no event shall any fee exceed statutory limits imposed by
41 U.S.C. 254(b).
(e)(1) Contracting Officers shall include negative fee incentives
in contracts when appropriate. A negative fee incentive is one in which
the contractor will not be paid the full target fee amount when the
actual
[[Page 81016]]
performance level falls below the target level established in the
contract.
(2) Negative fee incentives may only be used when:
(i) A target level of performance can be established, which the
contractor can reasonably be expected to reach;
(ii) The value of the negative incentive is commensurate with the
lower level of performance and any additional administrative costs;
(iii) Factors likely to prevent attainment of the target level of
performance are clearly within the control of the contractor; and
(iv) The contract indicates clearly a level below which performance
is not acceptable.
(f) Prior to the issuance of a competitive solicitation or the
initiation of negotiations for an extension of an existing contract,
the HCA shall coordinate the maximum available fee, as allowed by 48
CFR 970.1504-1-1, and the fee amount targeted for negotiation, if less,
with the Procurement Executive, or designee. Solicitations shall
identify maximum available fee under the contract and may invite
offerors to propose fee less than the maximum available.
(g) When a contract subject to this subsection requires a
contractor to use its own facilities or equipment, or other resources
to make its own cost investment for contract performance, (e.g., when
there is no letter-of-credit financing) consideration may be given,
subject to approval by the Procurement Executive, or designee, to
increasing the total available fee amount above that otherwise provided
by this subsection.
(h) Multiple fee arrangements should be used in accordance with 48
CFR 970.1504-1-4.
970.1504-1-3 Special considerations: Laboratory management and
operation.
(a) For the management and operation of a laboratory, the
contracting officer shall consider whether any fee is appropriate.
Considerations should include:
(1) The nature and extent of financial or other liability or risk
assumed or to be assumed under the contract;
(2) The proportion of retained earnings (as established under
generally accepted accounting methods) that are utilized to fund the
performance of work related to the DOE contracted effort;
(3) Facilities capital or capital equipment acquisition plans;
(4) Other funding needs, to include contingency funding, working
capital funding, and provision for funding unreimbursed costs deemed
ordinary and necessary;
(5) The utility of fee as a performance incentive; and
(6) The need for fee to attract qualified contractors,
organizations, and institutions.
(b) In the event fee is considered appropriate, the contracting
officer shall determine the amount of fee in accordance with this
subsection.
(1) Costs incurred in the operation of a laboratory that are
allowable and allocable under the cost principles (i.e., commercial
using 48 CFR 31.2, nonprofit using OMB Circular A-122, or university-
affiliated using OMB Circular A-21), regulations (including 48 CFR
970.31), or statutes applicable to the operating contractor should be
classified as direct or indirect (overhead or G&A) charges to the
contract and not included as proposed fee. Exceptions must be approved
by the Procurement Executive, or designee.
(2) Except as specified in 48 CFR 970.1504-1-3(c)(3), the maximum
total amount of fee shall be calculated in accordance with 48 CFR
970.1504-1-5 or 48 CFR 970.1504-1-9, as appropriate. The total amount
of fee under any laboratory management and operating contract or other
designated contract shall not exceed, and may be significantly less
than, the result of that calculation. In determining the total amount
of fee, the contracting officer shall consider the evaluation of the
factors in paragraph (a) of this subsection as well as any benefits the
laboratory operator will receive due to its tax status.
(c) In the event fee is considered appropriate, the contracting
officer shall establish the type of fee arrangement in accordance with
this subsection.
(1) The amount of fee may be established as total available fee
with a base fee portion and a performance fee portion. Base fee, if
any, shall be an amount in recognition of the risk of financial
liability assumed by the contractor and shall not exceed the cost risk
associated with those liabilities or the amount calculated in
accordance with 48 CFR 970.1504-1-5, whichever is less. The total
available fee, excepting any base fee, shall normally be associated
with performance at or above the target level of performance as defined
by the contract. If performance in either of the two general work
categories appropriate for laboratories (science/technology and
support) is rated at less than the target level of performance, the
total amount of the available fee shall be subject to downward
adjustment. Such downward adjustment shall be subject to the terms of
the clause at 48 CFR 970.5215-3, Conditional Payment of Fee, Profit, or
Incentives, if contained in the contract.
(2) The amount of fee may be established as a fixed fee in
recognition of the risk of financial liability to be assumed by the
contractor, with such fixed fee amount not exceeding the cost risk
associated with the liabilities assumed or the amount of fee calculated
in accordance with 48 CFR 970.1504-1-5, whichever is less.
(3) If the fixed fee or total available fee exceeds 75% of the fee
that would be calculated per 48 CFR 970.1504-1-5 or 48 CFR 970.1504-1-
9; or if a fee arrangement other than one of those set forth in
paragraphs (c) (1) or (2) of this subsection is considered appropriate,
the approval of the Procurement Executive, or designee, shall be
obtained prior to its use.
(4) Fee, if any, as well as the type of fee arrangement, will
normally be established for the life of the contract. It will be
established at time of award, as part of the extend/compete decision,
at the time of option exercise, or at such other time as the parties
can mutually reach agreement, e.g., negotiations. Such agreement shall
require the approval of the Procurement Executive, or designee.
(5) Fee established for longer than one year shall be subject to
adjustment in the event of a significant change (greater than +/-10% or
a lessor amount if appropriate) to the budget or work scope.
(6) Retained earnings (reserves) shall be identified and a plan for
their use and disposition developed.
(7) The use of retained earnings as a result of performance of
laboratory management and operation may be restricted if the operator
is an educational institution.
970.1504-1-4 Types of contracts and fee arrangements.
(a) Contract types and fee arrangements suitable for management and
operating contracts may include cost, cost-plus-fixed-fee, cost-plus-
award-fee, cost-plus-incentive-fee, fixed-price incentive, firm-fixed-
price or any combination thereof (see 48 CFR 16.1). In accordance with
48 CFR 970.1504-1-2(b)(1), the fee arrangement chosen for each work
element should reflect the financial risk for project failure that
contractors are willing to accept. Contracting officials shall
structure each contract and the elements of the work in such a manner
that the risk is manageable and, therefore, assumable by the
contractor.
(b) Consistent with the concept of a performance-based management
contract, those contract types which incentivize performance and cost
[[Page 81017]]
control are preferred over a cost-plus-fixed-fee arrangement.
Accordingly, a cost-plus-fixed-fee contract in instances other than
those set forth in 48 CFR 970.1504-1-3(c)(2) may only be used when
approved in advance by the Procurement Executive, or designee.
(c) A cost-plus-award-fee contract is generally the appropriate
contract type for a management and operating contract.
(1) Where work cannot be adequately defined to the point that a
fixed price contract is acceptable, the attainment of acquisition
objectives generally will be enhanced by using a cost-plus-award-fee
contract or other incentive fee arrangement to effectively motivate the
contractor to superior performance and to provide the Department with
flexibility to evaluate actual performance and the conditions under
which it was achieved.
(2) The construct of fee for a cost-plus-award-fee management and
operating contract is that total available fee will equal a base fee
amount and a performance fee amount. The total available fee amount
including the performance fee amount the contractor may earn, in whole
or in part during performance, shall be established annually (or as
otherwise agreed to by the parties and approved by the Procurement
Executive, or designee), in an amount sufficient to motivate
performance excellence.
(3) However, consistent with concepts of performance-based
contracting, it is Departmental policy to place fee at risk based on
performance. Accordingly, a base fee amount will be available only when
approved in advance by the Procurement Executive, or designee, except
as permitted in 48 CFR 970.1504-1-3(c)(1). Any base fee amount shall be
fixed, expressed as a percent of the total available fee at inception
of the contract, and shall not exceed that percent during the life of
the contract.
(4) The performance fee amount may consist of an objective fee
component and a subjective fee component. Objective performance
measures, when appropriately applied, provide greater incentives for
superior performance than do subjective performance measures and should
be used to the maximum extent appropriate. Subjective measures should
be used when it is not feasible to devise effective predetermined
objective measures applicable to cost, technical performance, or
schedule for particular work elements.
(d) Consistent with performance-based contracting concepts,
performance objectives and measures related to performance fee should
be as clearly defined as possible and, where feasible, expressed in
terms of desired performance results or outcomes. Specific measures for
determining performance achievement should be used. The contract should
identify the amount and allocation of fee to each performance result or
outcome.
(e) Because the nature and complexity of the work performed under a
management and operating contract may be varied, opportunities may
exist to utilize multiple contract types and fee arrangements.
Consistent with paragraph (a) of this subsection and 48 CFR 16.1, the
contracting officer should apply that contract type or fee arrangement
most appropriate to the work component. However, multiple contract
types or fee arrangements:
(1) Must conform to the requirements of 48 CFR part 915 and 48 CFR
parts 15 and 16, and
(2) Where appropriate to the type, must be supported by:
(i) Negotiated costs subject to the requirements of the Truth in
Negotiations Act,
(ii) A pre-negotiation memorandum, and
(iii) A plan describing how each contract type or fee arrangement
will be administered.
(f) Cost reduction incentives are addressed in the clause at 48 CFR
970.5215-4, Cost Reduction. This clause provides for incentives for
quantifiable cost reductions associated with contractor proposed
changes to a design, process, or method that has an established cost,
technical, and schedule baseline, is defined, and is subject to a
formal control procedure. The clause is to be included in management
and operating contracts as appropriate. Proposed changes must be:
Initiated by the contractor, innovative, applied to a specific project
or program, and not otherwise included in an incentive under the
contract. Such cost reduction incentives do not constitute fee and are
not subject to statutory or regulatory fee limitations; however, they
are subject to all appropriate requirements set forth in this subpart.
(g) Operations and field offices shall take the lead in developing
and implementing the most appropriate pricing arrangement or cost
reduction incentive for the requirements. Pricing arrangements which
provide incentives for performance and cost control are preferred over
those that do not. The operations and field offices are to ensure that
the necessary resources and infrastructure exist within both the
contractor's and government's organizations to prepare, evaluate, and
administer the pricing arrangement or cost reduction incentive prior to
its implementation.
970.1504-1-5 General considerations and techniques for determining
fixed fees.
(a) The Department's fee policy recognizes that fee is remuneration
to contractors for the entrepreneurial function of organizing and
managing resources, the use of their resources (including capital
resources), and, as appropriate, their assumption of the risk that some
incurred costs (operating and capital) may not be reimbursed.
(b) Use of a purely cost-based structured approach for determining
fee objectives and amounts for DOE management and operating contracts
is inappropriate considering the limited level of contractor cost,
capital goods, and operating capital outlays for performance of such
contracts. Instead of being solely cost-based, the desirable approach
calls for a structure that allows evaluation of the following eight
significant factors, as outlined in order of importance, and the
assignment of appropriate fee values (subject to the limitations on
fixed fee in 48 CFR 970.1504-1-6):
(1) The presence or absence of financial risk, including the type
and terms of the contract;
(2) The relative difficulty of work, including specific performance
objectives, environment, safety and health concerns, and the technical
and administrative knowledge, and skill necessary for work
accomplishment and experience;
(3) Management risk relating to performance, including:
(i) Composite risk and complexity of principal work tasks required
to do the job;
(ii) Labor intensity of the job;
(iii) Special control problems; and
(iv) Advance planning, forecasting and other such requirements;
(4) Degree and amount of contract work required to be performed by
and with the contractor's own resources, as compared to the nature and
degree of subcontracting and the relative complexity of subcontracted
efforts, subcontractor management and integration;
(5) Size and operation (number of locations, plants, differing
operations, etc.);
(6) Influence of alternative investment opportunities available to
the contractor (i.e., the extent to which undertaking a task for the
Government displaces a contractor's opportunity to make a profit with
the same staff and equipment in some other field of activity);
(7) Benefits which may accrue to the contractor from gaining
experience and
[[Page 81018]]
knowledge of how to do something, from establishing or enhancing a
reputation, or from having the opportunity to hold or expand a staff
whose loyalties are primarily to the contractor; and
(8) Other special considerations, including support of Government
programs such as those relating to small and minority business
subcontracting, energy conservation, etc.
(c) The total fee objective for a particular annual fixed fee
negotiation is established by evaluating the factors in this
subsection, assigning fee values to them, and totaling the resulting
amounts (subject to limitations on total fixed fee in 48 CFR 970.1504-
1-6).
970.1504-1-6 Calculating fixed fee.
(a) In recognition of the complexities of the fee determination
process, and to assist in promoting a reasonable degree of consistency
and uniformity in its application, the following fee schedules set
forth the maximum amounts of fee that contracting activities are
allowed to award for a particular fixed fee transaction calculated
annually.
(b) Fee schedules representing the maximum allowable annual fixed
fee available under management and operating contracts have been
established for the following management and operating contract
efforts:
(1) Production;
(2) Research and Development; and
(3) Environmental Management.
(c) The schedules are:
PRODUCTION EFFORTS
----------------------------------------------------------------------------------------------------------------
Incr.
Fee base (dollars) Fee (dollars) Fee (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Up to $1 Million................................................ .............. .............. 7.66
1,000,000....................................................... $76,580 7.66 6.78
3,000,000....................................................... 212,236 7.07 6.07
5,000,000....................................................... 333,670 6.67 4.90
10,000,000...................................................... 578,726 5.79 4.24
15,000,000...................................................... 790,962 5.27 3.71
25,000,000...................................................... 1,161,828 4.65 3.35
40,000,000...................................................... 1,663,974 4.16 2.92
60,000,000...................................................... 2,247,076 3.75 2.57
80,000,000...................................................... 2,761,256 3.45 2.34
100,000,000..................................................... 3,229,488 3.23 1.45
150,000,000..................................................... 3,952,622 2.64 1.12
200,000,000..................................................... 4,510,562 2.26 0.61
300,000,000..................................................... 5,117,732 1.71 0.53
400,000,000..................................................... 5,647,228 1.41 0.45
500,000,000..................................................... 6,097,956 1.22 ..............
Over $500 Million............................................... 6,097,956 .............. 0.45
----------------------------------------------------------------------------------------------------------------
RESEARCH AND DEVELOPMENT EFFORTS
----------------------------------------------------------------------------------------------------------------
Incr.
Fee base (dollars) Fee (dollars) Fee (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Up to $1 Million................................................ .............. .............. 8.42
1,000,000....................................................... 84,238 8.42 7.00
3,000,000....................................................... 224,270 7.48 6.84
5,000,000....................................................... 361,020 7.22 6.21
10,000,000...................................................... 671,716 6.72 5.71
15,000,000...................................................... 957,250 6.38 4.85
25,000,000...................................................... 1,441,892 5.77 4.22
40,000,000...................................................... 2,075,318 5.19 3.69
60,000,000...................................................... 2,813,768 4.69 3.27
80,000,000...................................................... 3,467,980 4.33 2.69
100,000,000..................................................... 4,006,228 4.01 1.69
150,000,000..................................................... 4,850,796 3.23 1.14
200,000,000..................................................... 5,420,770 2.71 0.66
300,000,000..................................................... 6,083,734 2.03 0.58
400,000,000..................................................... 6,667,930 1.67 0.50
500,000,000..................................................... 7,172,264 1.43 ..............
Over $500 Million............................................... 7,172,264 .............. 0.50
----------------------------------------------------------------------------------------------------------------
ENVIRONMENTAL MANAGEMENT EFFORTS
----------------------------------------------------------------------------------------------------------------
Incr.
Fee base (dollars) Fee (dollars) Fee (percent) (percent)
----------------------------------------------------------------------------------------------------------------
Up to $1 Million................................................ .............. .............. 7.33
$1,000,000...................................................... 73,298 7.33 6.49
3,000,000....................................................... 203,120 6.77 5.95
5,000,000....................................................... 322,118 6.44 5.40
10,000,000...................................................... 592,348 5.92 4.83
15,000,000...................................................... 833,654 5.56 4.03
25,000,000...................................................... 1,236,340 4.95 3.44
40,000,000...................................................... 1,752,960 4.38 3.29
60,000,000...................................................... 2,411,890 4.02 3.10
80,000,000...................................................... 3,032,844 3.79 2.49
[[Page 81019]]
100,000,000..................................................... 3,530,679 3.53 1.90
150,000,000..................................................... 4,479,366 2.99 1.48
200,000,000..................................................... 5,219,924 2.61 1.12
300,000,000..................................................... 6,337,250 2.11 0.88
400,000,000..................................................... 7,219,046 1.80 0.75
500,000,000..................................................... 7,972,396 1.59 0.58
750,000,000..................................................... 9,423,463 1.26 0.55
1,000,000,000................................................... 10,786,788 1.08 ..............
Over $1.0 billion............................................... 10,786,788 .............. 0.55
----------------------------------------------------------------------------------------------------------------
970.1504-1-7 Fee Base.
(a) The fee base is an estimate of necessary allowable costs, with
some exclusions. It is used in the fee schedules to determine the
maximum annual fee for a fixed fee contract. That portion of the fee
base that represents the cost of the Production, Research and
Development, or Environmental Management work to be performed, shall be
exclusive of the cost of source and special nuclear materials;
estimated costs of land, buildings and facilities whether to be leased,
purchased or constructed; depreciation of Government facilities; and
any estimate of effort for which a separate fee is to be negotiated.
(b) Such portion of the fee base, in addition to the adjustments in
paragraph (a) of this subsection, shall exclude:
(1) Any part of the estimated cost of capital equipment (other than
special equipment) which the contractor procures by subcontract or
other similar costs which is of such magnitude or nature as to distort
the technical and management effort actually required of the
contractor;
(2) At least 20% of the estimated cost or price of subcontracts and
other major contractor procurements;
(3) Up to 100% of the estimated cost or price of subcontracts and
other major contractor procurements if they are of a magnitude or
nature as to distort the technical and management effort actually
required of the contractor;
(4) Special equipment as defined in 48 CFR 970.1504-1-8;
(5) Estimated cost of Government-furnished property, services and
equipment;
(6) All estimates of costs not directly incurred by or reimbursed
to the operating contractor;
(7) Estimates of home office or corporate general and
administrative expenses that shall be reimbursed through the contract;
(8) Estimates of any independent research and development cost or
bid and proposal expenses that may be approved under the contract;
(9) Any cost of work funded with uncosted balances previously
included in a fee base of this or any other contract performed by the
contractor;
(10) Cost of rework attributable to the contractor; and
(11) State taxes.
(c) In calculating the annual fee amounts associated with the
Production, Research and Development, or Environmental Management work
to be performed, the fee base is to be allocated to the category
reflecting the work to be performed and the appropriate fee schedule
utilized.
(d) The portion of the fee base associated with the Production,
Research and Development, or Environmental Management work to be
performed and the associated schedules in this part are not intended to
reflect the portion of the fee base or related compensation for unusual
architect-engineer, construction services, or special equipment
provided by the management and operating contractor. Architect-engineer
and construction services are normally covered by special agreements
based on the policies applying to architect-engineer or construction
contracts. Fees paid for such services shall be calculated using the
provisions of 48 CFR 91504-1-5 relating to architect-engineer or
construction fees and shall be in addition to the operating fees
calculated for the Production, Research and Development, or
Environmental Management work to be performed. Special equipment
purchases shall be addressed in accordance with the provisions of 48
CFR 970.1504-1-8 relating to special equipment.
(e) No schedule set forth in 48 CFR 915.404-4-71-5 or 48 CFR
970.1504-1-6 shall be used more than once in the determination of the
fee amount for an annual period, unless prior approval of the
Procurement Executive, or designee, is obtained.
970.1504-1-8 Special equipment purchases.
(a) Special equipment is sometimes procured in conjunction with
management and operating contracts. When a contractor procures special
equipment, the DOE negotiating official shall determine separate fees
for the equipment which shall not exceed the maximum fee allowable as
established using the schedule in 48 CFR 915.404-4-71-5(h).
(b) In determining appropriate fees, factors such as complexity of
equipment, ratio of procurement transactions to volume of equipment to
be purchased and completeness of services should be considered. Where
possible, the reasonableness of the fees should be checked by their
relationship to actual costs of comparable procurement services.
(c) For purposes of this subsection, special equipment is equipment
for which the purchase price is of such a magnitude compared to the
cost of installation as to distort the amount of technical direction
and management effort required of the contractor. Special equipment is
of a nature that requires less management attention. When a contractor
procures special equipment, the DOE negotiating official shall
determine separate fees for the equipment using the schedule in 48 CFR
915.404-4-71-5(h). The determination of specific items of equipment in
this category requires application of judgment and careful study of the
circumstances involved in each project. This category of equipment
would generally include:
(1) Major items of prefabricated process or research equipment; and
(2) Major items of preassembled equipment such as packaged boilers,
generators, machine tools, and large electrical equipment. In some
cases, it would also include special apparatus or devices such as
reactor vessels and reactor charging machines.
970.1504-1-9 Special considerations: Cost-plus-award-fee.
(a) When a management and operating contract is to be awarded on a
cost-plus-award-fee basis, several special considerations are
appropriate.
[[Page 81020]]
(b) All annual performance incentives identified under these
contracts are funded from the annual total available fee, which
consists of a base fee amount (which may be zero) and a performance fee
amount (which typically will consist of an incentive fee component for
objective performance requirements, an award fee component for
subjective performance requirements, or both).
(c) The annual total available fee for the contract shall equal the
product of the fee(s) that would have been calculated for an annual
fixed fee contract and the classification factor(s) most appropriate
for the facility/task. If more than one fee schedule is applicable to
the contract, the annual total available fee shall be the sum of the
available fees derived proportionately from each fee schedule;
consideration of significant factors applicable to each fee schedule;
and application of a Classification Factor(s) most appropriate for the
work.
(d) Classification Factors applied to each Facility/Task Category
are:
------------------------------------------------------------------------
Classification
Facility/task category factor
------------------------------------------------------------------------
A....................................................... 3.0
B....................................................... 2.5
C....................................................... 2.0
D....................................................... 1.25
------------------------------------------------------------------------
(e) The contracting officer shall select the Facility/Task Category
after considering the following:
(1) Facility/Task Category A. The main focus of effort performed is
related to:
(i) The manufacture, assembly, retrieval, disassembly, or disposal
of nuclear weapons with explosive potential;
(ii) The physical cleanup, processing, handling, or storage of
nuclear radioactive or toxic chemicals with consideration given to the
degree the nature of the work advances state of the art technologies in
cleanup, processing or storage operations and/or the inherent
difficulty or risk of the work is significantly demanding when compared
to similar industrial/DOE settings (i.e., nuclear energy processing,
industrial environmental cleanup);
(iii) Construction of facilities such as nuclear reactors, atomic
particle accelerators, or complex laboratories or industrial units
especially designed for handling radioactive materials;
(iv) Research and development directly supporting paragraphs
(e)(1)(i), (ii), or (iii) of this subsection and not conducted in a
laboratory, or
(v) As designated by the Procurement Executive, or designee.
(Classification factor 3.0)
(2) Facility/Task Category B. The main focus of effort performed is
related to:
(i) The safeguarding and maintenance of nuclear weapons or nuclear
material;
(ii) The manufacture or assembly of nuclear components;
(iii) The physical cleanup, processing, handling, or storage of
nuclear radioactive or toxic chemicals, or other substances which pose
a significant threat to the environment or the health and safety of
workers or the public, if the nature of the work uses state of the art
technologies or applications in such operations and/or the inherent
difficulty or risk of the work is more demanding than that found in
similar industrial/DOE settings (i.e., nuclear energy, chemical or
petroleum processing, industrial environmental cleanup);
(iv) The detailed planning necessary for the assembly/disassembly
of nuclear weapons/components;
(v) Construction of facilities involving operations requiring a
high degree of design layout or process control;
(vi) Research and development directly supporting paragraphs
(e)(2)(i), (ii), (iii), (iv) or (v) of this subsection and not
conducted in a laboratory; or
(vii) As designated by the Procurement Executive, or designee.
(Classification factor 2.5)
(3) Facility/Task Category C. The main focus of effort performed is
related to:
(i) The physical cleanup, processing, or storage of nuclear
radioactive or toxic chemicals if the nature of the work uses routine
technologies in cleanup, processing or storage operations and/or the
inherent difficulty or risk of the work is similar to that found in
similar industrial/DOE settings (i.e., nuclear energy, chemical
processing, industrial environmental cleanup);
(ii) Plant and facility maintenance;
(iii) Plant and facility security (other than the safeguarding of
nuclear weapons and material);
(iv) Construction of facilities involving operations requiring
normal processes and operations; general or administrative service
buildings; or routine infrastructure requirements;
(v) Research and development directly supporting paragraphs
(e)(3)(i), (ii), (iii) or (iv) of this subsection and not conducted in
a laboratory; or
(vi) As designated by the Procurement Executive, or designee.
(Classification factor 2.0)
(4) Facility/Task Category D. The main focus of the effort
performed is research and development conducted at a laboratory.
(Classification factor 1.25)
(f) Where the Procurement Executive, or designee, has approved a
base fee, the Classification Factors shall be reduced, as approved by
the Procurement Executive, or designee.
(g) Any risks which are indemnified by the Government (for example,
by the Price-Anderson Act) will not be considered as risk to the
contractor.
(h) All management and operating contracts awarded on a cost-plus-
award-fee basis shall set forth in the contract, or the Performance
Evaluation and Measurement Plan(s) required by the contract clause at
48 CFR 970.5215-1, Total Available Fee: Base Fee Amount and Performance
Fee Amount, a site specific method of rating the contractor's
performance of the contract requirements and a method of fee
determination tied to the method of rating.
(i) Prior approval of the Procurement Executive, or designee, is
required for an annual total available fee amount exceeding the
guidelines in paragraph (c) of this subsection.
(j) DOE Operations/Field Office Managers must ensure that all
important areas of contract performance are specified in the contract
or Performance Evaluation and Measurement Plan(s), even if such areas
are not assigned specific weights or percentages of available fee.
970.1504-1-10 Special considerations: Fee limitations.
In situations where the objective performance incentives are of
unusual difficulty or where the successful completion of the
performance incentives would provide extraordinary value to the
Government, fees in excess of those allowed under 48 CFR 970.1504-1-5
and 48 CFR 970.1504-1-9 may be allowed with the approval of the
Procurement Executive, or designee. Requests to allow fees in excess of
those provided under other provisions of this fee policy must be
accompanied by a written justification with detailed supporting
rationale as to how the specific circumstances satisfy the two criteria
listed in this subsection.
970.1504-1-11 Documentation.
The contracting officer shall tailor the documentation of the
determination of fee prenegotiation objective based on 48 CFR 15.406-1,
Prenegotiation objectives, and the determination of the negotiated fee
in accordance with 48 CFR 15.406-3, Documenting the negotiation. The
contracting officer shall include as part of the documentation: the
rationale for the allocation of cost and the assignment of Facility/
Task Categories; a discussion of the calculations described in 48 CFR
970.1504-1-5; and discussion of any
[[Page 81021]]
other relevant provision of this subsection.
970.1504-2 Price negotiation.
(a) Management and operating contract prices (fee) and DOE
obligations to support contract performance shall be governed by:
(1) The level of activity authorized and the amount of funds
appropriated for DOE approved programs by specific program legislation;
(2) Congressional budget and reporting limitations;
(3) The amount of funds apportioned to DOE;
(4) The amount of obligational authority allotted to program
officials and Approved Funding Program limitations; and
(5) The amount of funds actually available to the DOE operating
activity as determined in accordance with applicable financial
regulations and directives.
(b) Funds shall be obligated and made available by contract
provision or modification after the funds become available for
obligation for payment to support performance of DOE approved projects,
tasks, work authorizations, or services.
(c) Contractor expenditures shall be limited to the overall amount
of funds available and obligated on the contract. As prescribed at 48
CFR 970.3270(b), the clause at 48 CFR 970.5232-4, Obligation of Funds,
is used for this purpose.
970.1504-3 Documentation.
970.1504-3-1 Cost or pricing data.
(a) The certification requirements of 48 CFR 15.406-2 are not
applied to DOE cost-reimbursement management and operating contracts.
(b) The contracting officer shall ensure that management and
operating contractors and their subcontractors obtain cost or pricing
data prior to the award of a negotiated subcontract or modification of
a subcontract in accordance with 48 CFR 15.406-2, and incorporate
appropriate contract provisions similar to those set forth at 48 CFR
52.215-10 and 48 CFR 52.215-11 that provide for the reduction of a
negotiated subcontract price by any significant amount that the
subcontract price was increased because of the submission of defective
cost or pricing data by a subcontractor at any tier.
(c) The clauses at 48 CFR 52.215-12 and 48 CFR 52.215-13 shall be
included in management and operating contracts.
970.1504-4 Special cost or pricing areas.
970.1504-4-1 Make-or-buy plans.
970.1504-4-2 Policy.
(a) Contracting officers shall require management and operating
contractors to develop and implement make-or-buy plans that establish a
preference for providing supplies or services (including construction
and construction management) on a least-cost basis, subject to program
specific make-or-buy criteria. The emphasis of this make-or-buy
structure is to eliminate bias for in-house performance where an
activity may be performed at less cost or otherwise more efficiently
through subcontracting.
(b) A work activity, supply or service is provided at ``least
cost'' when, after consideration of a variety of appropriate
programmatic, business, and financial factors, it is concluded that
performance by either ``in-house'' resources or by contracting out is
likely to provide the property or service at the lowest overall cost.
Programmatic factors include, but are not limited to, program specific
make-or-buy criteria established by the Department of Energy, the
impact of a ``make'' or a ``buy'' decision on mission accomplishment,
and anticipated changes to the mission of the facility or site.
Business factors pertain to such elements as market conditions, past
experience in obtaining similar supplies or services, and overall
operational efficiencies that might be available through either in-
house performance or contracting out. Among the financial factors that
may be considered to determine a least-cost alternative in a make-or-
buy analysis are both recurring and one-time costs attributable to
either retaining or contracting out a particular item, financial risk,
and the anticipated contract price.
(c) In developing and implementing its make-or-buy plan, a
contractor shall be required to assess subcontracting opportunities and
implement subcontracting decisions in accordance with the following:
(1) The contractor shall conduct internal productivity improvement
and cost-reduction programs so that in-house performance options can be
made more efficient and cost-effective.
(2) The contractor shall consider subcontracting opportunities with
the maximum practicable regard for open communications with potentially
affected employees and their representatives. Similarly, a contractor
will communicate its plans, activities, cost-benefit analyses, and
decisions with those stakeholders likely to be affected by such
decisions, including representatives of the community and local
businesses.
970.1504-4-3 Requirements.
(a) Development of program-specific make-or-buy criteria.
(1) Program specific make-or-buy criteria are those factors that
reflect specific mission or program objectives (including operational
efficiency, contractor diversity, environment, safety and health, work
force displacement and restructuring, and collective bargaining
agreements) and that, upon their application to a specific work effort,
would override a decision based on a purely economic rationale. These
criteria are to be used to assess each work effort identified in a
facility's or site's make-or-buy plan to determine the appropriateness
of a contractor's make-or-buy decisions.
(2) Heads of Contracting Activities shall ensure that program
specific make-or-buy criteria are developed and provided to the
contractor for use in its make-or-buy plan administration activities
for the facility, site, or specific program, as appropriate. Although
the Head of the Contracting Activity has the responsibility for
ensuring that the program-specific make-or-buy criteria are developed
and provided to the contractor, the actual development of the program
specific make or buy criteria should be accomplished by the appropriate
collaboration of headquarters and field office program, technical, and
business specialists. Accordingly, these organizations and individuals
should be relied on for the development of the program specific make or
buy criteria so that they appropriately reflect program considerations
applicable to the contractor's make-or-buy decisions.
(b) Make-or-buy plan property and services. Supplies or services
estimated to cost less than one (1) percent of the estimated total
operating cost for a year or $1 million for the same year, whichever is
less, need not be included in the contractor's make-or-buy plan.
However, adjustments may be made to these thresholds where programmatic
or cost considerations would indicate that a particular supply or
service should be included in the make-or-buy plan.
(c) Competitive solicitation requirements.
(1) To the extent practicable, a competitive solicitation for the
management and operation of a Department of Energy facility or site
should:
(i) Identify those programs, projects, work areas, functions or
services that the Department intends for the
[[Page 81022]]
successful offeror to include in any make-or-buy plan; and
(ii) Require the submission of a preliminary make-or-buy plan for
the period of performance of the contract from each offeror as part of
its proposal submitted in response to the competitive solicitation.
(2) If the requirement for each offeror to submit a preliminary
make-or-buy plan as part of its proposal is impractical or otherwise
incompatible with the acquisition strategy, consideration should be
given to structuring the evaluation criteria for the competitive
solicitation in such a manner as to permit the evaluation of an
offeror's approach to conducting its make-or-buy program within the
context of the contractual requirements.
(3) The successful offeror's preliminary make-or-buy plan shall be
submitted for final approval within 180 days after contract award,
consistent with the requirements of 48 CFR 970.5215-2(c), Make-or-Buy
Plan.
(d) Evaluation of the contractor's make-or-buy plan. In evaluating
the contractor's make-or-buy plan, the contracting officer shall
consider the following factors:
(1) The program specific make-or-buy criteria (such as operational
efficiency, contractor diversity, environment, safety and health, work
force displacement and restructuring, and collective bargaining
agreements) with particular attention to the effect of a ``buy''
decision on the contractor's ability to maintain core competencies
needed to accomplish mission-related programs and projects;
(2) The impact of a ``make'' or ``buy'' decision on contract cost,
schedule, and performance and financial risk;
(3) The potential impact of a ``make'' or ``buy'' decision on known
future mission or program activities at the facility or site;
(4) Past experience at the facility or site regarding ``make-or-
buy'' decisions for the same, or similar, supplies or services;
(5) Consistency with the contractor's approved subcontracting plan,
as required by the clause entitled ``Small, Small Disadvantaged and
Women-Owned Small Business Subcontracting Plan'' (48 CFR 52.219-9), and
implementation of section 3021 of the Energy Policy Act of 1992.
(6) Local market conditions, including contractor work force
displacement and the availability of firms that can meet the work
requirements with regard to quality, quantity, cost, and timeliness;
(7) Where the construction of new or additional facilities is
required, that the cost of such facilities is in the Government's best
interest when compared to subcontracting or privatization alternatives;
and
(8) Whether all relevant requirements and costs of performing the
work by the contractor and through subcontracting are considered and
any different requirements for the same work are reconciled.
(e) Approval. The contracting officer shall approve all plans and
revisions thereto. Once approved, a make-or-buy plan shall remain
effective for the term of the contract (up to a period of five years),
unless circumstances warrant a change.
(f) Administration. The contractor's performance against the
approved make-or-buy plan shall be monitored to ensure that:
(1) The contractor is complying with the plan;
(2) Items identified for deferral decisions are addressed in a
timely manner; and
(3) The contractor periodically updates the make-or-buy plan based
on changed circumstances or significant new work.
970.1504-5 Solicitation provision contract clauses.
(a) The contracting officer shall insert the clause at 48 CFR
970.5215-1, Total Available Fee: Base Fee Amount and Performance Fee
Amount, in management and operating contracts, and other contracts
determined by the Procurement Executive, or designee, that include
cost-plus-award-fee arrangements.
(1) The contracting officer shall include the clause with its
Alternate I when the award fee cycle consists of two or more evaluation
periods.
(2) The contracting officer shall include the clause with its
Alternate II when the award fee cycle consists of one evaluation
period.
(3) The contracting officer shall include the clause with its
Alternate III when the DOE Operations/Field Office Manager, or
designee, requires the contractor to submit a self-assessment.
(4) The contracting officer shall include the clause with its
Alternate IV when the DOE Operations/Field Office Manager, or designee,
permits the contractor to submit a self-assessment at the contractor's
option.
(b) The contracting officer shall insert the clause at 48 CFR
970.5215-2, Make-or-Buy Plan, in management and operating contracts.
The contracting officer may add a sentence at the end of paragraph (d)
of the clause to identify where in the contract the make-or-buy plan is
located.
(c) The contracting officer shall insert the clause at 48 CFR
970.5215-3, Conditional Payment of Fee, Profit, or Incentives, in
management and operating contracts, and other contracts determined by
the Procurement Executive, or designee. The contracting officer shall
include the clause with its Alternate I in contracts awarded on cost-
plus-award-fee, multiple fee, or incentive fee basis which may include
various types of fee and incentive arrangements.
(d) The contracting officer shall insert the clause at 48 CFR
970.5215-4, Cost Reduction, in management and operating contracts, and
other contracts determined by the Procurement Executive, or designee,
if cost savings programs are contemplated.
(e) The Contracting officer shall insert the provision at 48 CFR
970.5215-5, Limitation on Fee, in solicitations for management and
operating contracts, and other contracts determined by the Procurement
Executive, or designee.
Subpart 970.17--Special Contracting Methods
970.1706 Management and operating contracts.
970.1706-1 Award, renewal, and extension.
(a) Contract term. Effective work performance under a management
and operating contract is facilitated by the use of a relatively long
contract term of up to ten (10) years. Accordingly, management and
operating contracts shall provide for a basic contract term not to
exceed five (5) years and may include an option(s) to extend the term
for additional periods; provided, that no one option period exceeds
five (5) years in duration and the total term of the contract,
including any options exercised, does not exceed ten (10) years. The
specific term of the base period and of any options periods shall be
determined at the time of the authorization to compete or extend the
contract. The term ``option'' as used in this subpart means a
unilateral right in the contract by which the Government can extend the
term of the contract. Accordingly, except as may be provided for
through the inclusion of an option(s) in the contract to extend the
term, any extension to continue the contract with the incumbent
contractor beyond its term shall only occur when such extension can be
justified under one of the statutory authorities identified in 48 CFR
6.302 and when authorized by the Head of the Agency.
(b) Exercise of option. As part of the review required by 48 CFR
17.605(b), the contracting officer shall assess whether competing the
contract will produce a more advantageous offer than
[[Page 81023]]
exercising the option. The incumbent contractor's past performance
under the contract, the extent to which performance-based management
contract provisions are present, or can be negotiated into, the
contract, and the impact of a change in a contractor on the
Department's discharge of its programs are considerations that shall be
addressed in the contracting officer's decision that the exercise of
the option is in the Government's best interest. The contracting
officer's decision shall be approved by the Procurement Executive and
the cognizant Assistant Secretary(s).
(c) Conditional Authorization of Non-competitive Extension Made
Pursuant to Authority Under CICA. Authorization to extend a management
and operating contract by the Head of the Agency shall be considered
conditional upon the successful negotiation of the contract to be
extended in accordance with the Department's negotiation objectives.
The Head of the Contracting Activity shall advise the Procurement
Executive no later than 6 months after receipt of the conditional
authorization as to whether the Department's objectives will be met
and, if not, the contracting activity's plans for competing the
requirement.
970.1706-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 52.217-9,
Option to Extend the Term of the Contract, in all management and
operating contracts when the inclusion of an option is appropriate.
Subpart 970.19--Small, Small Disadvantaged and Women-Owned Small
Business Concerns
970.1907 Subcontracting with Small Business, Small Disadvantaged
Business and Woman-Owned Small Business Concerns.
970.1907-1 Subcontracting plan requirements.
Pursuant to the clause at 48 CFR 52.219-9, Small Business
Subcontracting Plan, which is required for all management and operating
contracts, each management and operating contract shall include a
subcontracting plan which is effective for the term of the contract.
Goals for the contract shall be negotiated annually when revised
funding levels are determined. The plan should include provisions for
revising the goals or any other sections of the plan. Such revisions
shall be in writing, approved by the contracting officer, and shall be
specifically made a material part of the contract.
Subpart 970.22--Application of Labor Policies
970.2200 Scope of subpart.
This subpart prescribes Department of Energy labor policies
pertaining to the award and administration of management and operating
contracts.
970.2201 Basic labor policies.
970.2201-1 Labor relations.
970.2201-1-1 General.
Contracting officers shall, in appropriate circumstances, follow
the guidance in 48 CFR Subpart 22.1, as supplemented in this section,
in the award and administration of management and operating contracts.
970.2201-1-2 Policies.
(a) The extent of Government ownership of the nation's energy plant
and materials, and the overriding concerns of national defense and
security, impose special conditions on personnel and labor relations in
the energy program. Such special conditions include the need for
continuity of vital operations at DOE installations; retention by DOE
of absolute authority on all questions of security; and DOE review of
labor expenses under management and operating contracts as a part of
its responsibility for assuring judicious expenditure of public funds.
It is the intent of DOE that personnel and labor policies throughout
the energy program reflect the best experience of American industry in
aiming to achieve the type of stable labor-management relations that
are essential to the proper development of the energy program. The
following enunciates the principles upon which the DOE policy is based:
(1) Employment standards. (i) Management and operating contractors
are expected to bring experienced, proven personnel from their private
operations to staff key positions on the contract work and to recruit
other well-qualified personnel as needed. Such personnel should be
employed and treated during employment without discrimination by reason
of race, color, religion, sex, or national origin. Contractors shall be
required to take affirmative action to achieve these objectives.
(ii) The job qualifications and suitability of prospective
employees should be established by the contractor prior to employment
by careful personnel investigations. Such personnel investigations
should include, as appropriate: A credit check; verification of high
school degree/diploma or degree/diploma granted by an institution of
higher learning within the last 5 years; contacts with listed personal
references; contacts with listed employers for the past 3 years
(excluding employment of less than 60 days duration, part-time
employments, and craft/union employments); and local law enforcement
checks when such checks are not prohibited by State or local law or
regulation, and when the individual resides in the jurisdiction where
the contractor is located. When a DOE access authorization (security
clearance) will be required, the aforementioned preemployment checks
must be conducted and the applicant's job qualifications and
suitability must be established before a request is made to the DOE to
process the applicant for access authorization. Evidence must be
furnished to the DOE with the applicant's security forms that specify:
The date each check was conducted, the entity contacted that provided
information concerning the applicant, a synopsis of the information
provided as a result of each contact, and a statement that all
information available has been reviewed and favorably adjudicated in
accordance with the contractor's personnel policies. When an applicant
is being hired specifically for a position which requires a DOE access
authorization, the applicant shall not be placed in that position prior
to the access authorization being granted by the DOE unless an
exception has been obtained from the Head of the Contracting Activity,
or designee. If an applicant is placed in that position prior to access
authorization being granted by the DOE, the applicant may not be
afforded access to classified matter or special nuclear materials (in
categories requiring access authorization) until the DOE notifies the
employer that access authorization has been granted. Management and
operating contractors and other contractors operating DOE facilities
may include the requirements set forth in this subsection in
subcontracts (appropriately modified to identify the parties) wherein
subcontract employees will be required to hold DOE access authorization
in order to perform on-site duties, such as protective force
operations.
(iii) Consistent with the policies set forth in this subpart, the
contractor is responsible for maintaining satisfactory standards for
employee qualifications, performance, conduct, and business ethics
under its own personnel policies.
(2) Security. On all matters of security at its facilities, DOE
retains absolute authority and neither the regulations and policies
pertaining to security, nor their administration, are matters for
collective bargaining between the
[[Page 81024]]
contractor's management and labor. Insofar as DOE security regulations
affect the collective bargaining process, the security policies and
regulations will be made known to both parties. To the fullest extent
feasible, DOE will consult with representatives of the contractor's
management and labor when formulating security regulations and policies
that may affect the collective bargaining process.
(3) Wages, salaries, and employee benefits. (i) Wages, salaries,
and employee benefits shall be administered in a manner designated to
adapt the normal practices and conditions of industry or institutions
of higher education to the contract work, and to provide for
appropriate review by DOE. Area practices, valid patterns, and well-
established commercial or academic practices of the contractors, as
appropriate, form the criteria for the establishment and adjustment of
compensation schedules.
(ii) The aspects of wages, hours, and working conditions which are
the substance of collective bargaining in normal organized industries
will be left to the orderly processes of negotiation and agreement
between DOE contractor management and employee representatives with
maximum possible freedom from Government interference.
(4) Employee relations. The handling of employee relations on
contract work, including such matters as the conduct and discipline of
the work force and the handling of employee grievances, is part of the
normal management responsibility of the contractor.
(5) Collective bargaining. (i) DOE review of collective bargaining
practices will be premised on the view that management's trusteeship
for the operation of the Government facilities includes the duty to
adopt practices which are fundamental to the friendly adjustment of
disputes, and which experience has shown, promote orderly collective
bargaining relationships. Practices inconsistent with this view may be
objected to if not found to be otherwise clearly warranted.
(ii) Consistent with the policy of assuring continuity of operation
of vital facilities, all collective bargaining agreements at DOE-owned
facilities should provide that grievances and disputes involving the
interpretation or application of the agreement will be settled without
resorting to strike, lockout, or other interruption of normal
operations. For this purpose, each collective bargaining agreement
entered into during the period of performance of this contract should
provide an effective grievance procedure with arbitration as its final
step, unless the parties mutually agree upon some other method of
assuring continuity of operation for the term of the collective
bargaining agreement.
(iii) DOE expects its management and operating contractors and the
unions representing the contractor's employees to cooperate fully with
the Federal Mediation and Conciliation Service.
(6) Personnel training. DOE encourages and supports personnel
training programs aimed at improving work efficiency or developing
needed skills which are not otherwise obtainable.
(7) Working conditions. Accident, fire, health, and occupational
hazards associated with DOE activities will be held to a practical
minimum level and controlled in the interest of maintenance of health
and prevention of accidents. Subject to DOE control, contractors shall
be required to maintain comprehensive continuous preventive and
protective programs appropriate to the particular activities throughout
all operations. Appropriate financial protection in case of
occupational disability must be provided to employees on DOE projects.
(b) Title to payroll and associated records under certain contracts
for the management and operation of DOE facilities, and for necessary
miscellaneous construction incidental to the function of these
facilities, shall vest in the Government. Such records are to be
disposed of in accordance with DOE directions. For such contracts, the
Solicitor of Labor has granted a tolerance from the Department of Labor
Regulations to omit from the prescribed labor clauses the requirement
for the retention of payrolls and associated records for a period of
three years after completion of the contract. Under this tolerance, the
records retention requirements for all labor clauses in the contract
and the Fair Labor Standards Act are satisfied by disposal of such
records in accordance with applicable DOE directives.
970.2201-1-3 Contract clause.
In addition to the clause at 48 CFR 52.222-1, Notice to the
Government of Labor Disputes, the contracting officer shall insert the
clause at 970.5222-1, Collective Bargaining Agreements--Management and
Operating Contracts, in all management and operating contracts.
970.2201-2 Overtime management.
970.2201-2-1 Policy.
Contracting officers shall ensure that management and operating
contractors manage overtime cost effectively and use overtime only when
necessary to ensure performance of work under the contract.
970.2201-2-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5222-
2, Overtime Management, in management and operating contracts.
970.2204 Labor standards for contracts involving construction.
970.2204-1 Statutory and regulatory requirements.
970.2204-1-1 Administrative controls and criteria for application of
the Davis-Bacon Act in operational or maintenance activities.
(a) Particular work items falling within one or more of the
following criteria normally will be classified as noncovered by the
Davis-Bacon Act, hereinafter referred to in this section as the
``Act.''
(1) Individual work items estimated to cost $2,000 or less. The
total dollar amount of the management and operating contract is not a
factor to be considered and bears no relation to individual work items
classified as construction, alteration and/or repair, including
painting and decorating. However, no item of work, the cost of which is
estimated to be in excess of $2,000, shall be artificially divided into
portions less than $2,000 for the purpose of avoiding the application
of the Act.
(2) Work and services that are a part of operational and
maintenance activities or which, being very closely and directly
involved therewith, are more in the nature of operational activities
than construction, alteration, and/or repair work. This includes work
and services which would involve a material risk to continuity of
operations, to life or property, or to DOE operating requirements, if
performed by persons other than the contractor's regular production and
maintenance forces. However, any decision that contracts or work items
are noncovered for these reasons must be made by the Head of the
Contracting Activity without power of delegation.
(3) Assembly, modification, setup, installation, replacement,
removal, rearrangement, connection, testing, adjustment, and
calibration of machinery and equipment. However, it is noted that these
activities are covered if they are part of, or would be a logical part
of, the construction of a facility, or if construction-type work which
is not ``incidental'' to the overall effort is involved.
(4) Experimental development of equipment, processes, or devices,
[[Page 81025]]
including assembly, fitting, installation, testing, reworking, and
disassembly. This refers to equipment, processes, and devices which are
assembled for the purpose of conducting a test or experiment. The
design may be only conceptual in character, and professional personnel
who are responsible for the experiment participate in the assembly.
Specifically excluded from the category of experimental development are
buildings and building utility services, as distinguished from
temporary connections thereto. Also specifically excluded from this
category is equipment to be used for continuous testing (e.g., a
machine to be continuously used for testing the tensile strength of
structural members).
(5) Experimental work in connection with peaceful uses of nuclear
energy. This refers to equipment, processes and devices which are
assembled and/or set in place and interconnected for the purpose of
conducting a test or experiment. The nature of the test or experiment
is such that professional personnel who are responsible for the test or
experiment and/or data to be derived therefrom must, by necessity,
participate in the assembly and interconnections. Specifically excluded
from experimental work are buildings, building utility services,
structural changes, drilling, tunneling, excavation, and back-filling
work which can be performed according to customary drawings and
specifications, and utility services of modifications to utility
services, as distinguished from temporary connections thereto. Work in
this category may be performed in mines or in other locations
specifically constructed for tests or experiments.
(6) Emergency work to combat the effects of fire, flood,
earthquake, equipment failure, accident, or other casualties, and to
restart the operational activity following the casualty. Work which is
not directly related to restarting the activity or which involves
rebuilding or replacement of a structure, structural components, or
equipment is excluded from this category.
(7) Decontamination, including washing, scrubbing, and scraping to
remove contamination; removal of contaminated soil or other material;
and painting or other resurfacing, provided that such painting or
resurfacing is an integral part of the decontamination activity and
performed by the employees of the contractors performing the
decontamination.
(8) Burial of contaminated soil waste or contained liquid; however,
initial preparatory work readying the burial ground for use (e.g., any
grading or excavating that is a part of initial site preparation,
fencing, drilling wells for continued monitoring of contamination,
construction of guard or other office space) is covered. Work performed
subsequent to burial which involves the placement of concrete or other
like activity is also covered.
(b) The classification of a contract as a contract for operational
or maintenance activities does not necessarily mean that all work and
activities at the contract location are classifiable as outside
coverage of the Act since it may be necessary to separate work which
should be classified as covered. Therefore, the Heads of Contracting
Activities shall establish and maintain controls for the careful
scrutiny of proposed work assignments under such contracts to assure
that:
(1) Contractors whose contracts do not contemplate the performance
of work covered by the Act with the contractor's own forces are neither
asked nor authorized to perform work within the scope of the Act. If
the actual work assignments do involve covered work, the contract
should be modified to include applicable provisions of the Act.
(2) Where covered work is performed by a contractor whose contract
contains provisions required by the Act, such work is performed as
required by law and the contract. After the contractor has been
informed, as provided in paragraph (b)(3) of this subsection, that
certain work is covered, the responsibilities of the Head of the
Contracting Activity to assure compliance is the same as it would be if
the work were being performed under a separate construction contract.
(3) Controls provided for above include consideration by the Head
of the Contracting Activity and the contractor, before work is begun or
contracted out, of the relation of the Act to the annual programming of
work; the contractor's work orders; and work contracted out in excess
of $2,000. The Head of the Contracting Activity may, if consistent with
DOE's responsibilities as described in this subsection, prescribe from
time to time classes of work as to which applicability or
nonapplicability of the Act is clear, for which the Head of the
Contracting Activity will require no further DOE determination on
coverage in advance of the work. For all work, controls to be
established by the Head of the Contracting Activity should provide for
notification to the contractor before work is begun as to whether such
work is covered. The Head of the Contracting Activity is responsible
for submitting to the Wage and Hours Division, Employment Standards
Administration, Department of Labor, Washington, D.C. 20210, all DOE
requests for project area or installation wage determinations, or
individual determinations, or extensions or modification thereto.
Requests for such determinations shall be made on Standard Form 308, at
least 30 calendar days before they are required for use in advertising
for bids or requests for proposals.
(c) Experimental installations. Within DOE programs, a variety of
experiments are conducted involving materials, fuels, coolants, and
processing equipment. Certain types of situations where tests and
experiments have presented coverage questions are described as follows:
(1) Set-ups of device and/or processes. The proving out of
investigative findings and theories of a scientific and technical
nature may require the set-up of various devices and/or processes at an
early, pre-prototype stage of development. These may range from
laboratory bench size to much larger set-ups. As a rule, these set-ups
are made within established facilities (normally laboratories),
required utility connections are made to services provided as a part of
the basic facilities, and the activity as a whole falls within the
functional purpose of the facility. Such set-ups are generally not
covered. However, the erection of structures which are public works is
covered if construction type work, other than incidental work, is
involved. Preparatory work for the set-up requiring structural changes
or modifications of basic utility services, as distinguished from
connections thereto, is covered. The following are illustrations of
noncovered set-ups of devices and/or processes:
(i) Assembly of piping and equipment within existing ``hot cell''
facilities for proving out a conceptual design of a chemical processing
unit;
(ii) Assembly of equipment, including adaptation and modification
thereof, in existing ``hot cell'' facilities to prove out a conceptual
design for remotely controlled machining equipment;
(iii) Assembly of the first graphite pile in a stadium at Stagg
Field in Chicago;
(iv) Assembly of materials and equipment for particular aspects of
the direct current thermonuclear experiments to explore feasibility and
to study other ramifications of the concept of high energy injection
and to collect data thereon.
(2) Loops. Many experiments are carried on in equipment assemblies,
called loops, in which liquids or gases are circulated under monitored
and
[[Page 81026]]
controlled conditions. For purposes of determining coverage under the
Act, loops may be classed as loop facilities or as loop set-ups. Both
of these classes of loops can include in-reactor loops and out-of-
reactor loops. In differentiating between clearly identified loop set-
ups and loop facilities, an area exists in which there have been some
questions of coverage, such as certain loops at the Material Test
Reactor and at Engineering Test Reactor and the Idaho National
Engineering and Environmental Laboratory site. Upon clarification of
this area, further illustrations will be added. In the meantime, the
differentiation between loop set-ups and loop facilities must be made
on a case-by-case basis, taking into account the total criteria set
forth in this subpart.
(i) Loop set-ups. The assembly, erection, modification, and
disassembly of a loop set-up is noncovered. A noncontroversial example
of a loop set-up is one which is assembled in a laboratory, e.g., Oak
Ridge National Laboratory, Argonne National Laboratory, or Lawrence
Livermore National Laboratory, for a particular test and thereafter
disassembled. However, preparatory work for a loop set-up requiring
structural changes or modifications of basic utility services as
distinguished from connections thereto is covered, as are material and
equipment that are installed for a loop set-up which is a permanent
part of the facility or which is use for a succession of experimental
programs.
(ii) Loop facilities. A loop facility differs from a loop set-up in
that it is of a more permanent character. It is usually, but not
always, of greater size. It normally involves the building or
modification of a structure. Sometimes it is installed as a part of
construction of the facility. It may be designed for use in a
succession of experimental programs over a longer period of time.
Examples of loop facilities are the in-reactor ``K'' loops at Hanford
and the large Aircraft Nuclear Propulsion loop at the Idaho National
Engineering and Environmental Laboratory site. The on-site assembly and
erection of such loop facilities are covered. However, once a loop
facility is completed and becomes operational, the criteria set forth
in this paragraph for operational and maintenance activities apply.
(3) Reactor component experiments. Other experiments are carried on
by insertion of experimental components within reactor systems without
the use of a loop assembly. An example of reactor facilities erected
for such experimental purposes are the special power excursion test
reactors (SPETRs) at the National Reactor Test Site which are designed
for studying reactor behavior and performance characteristics of
certain reactor components. Such a facility may consist of a reactor
vessel, pressurizing tank, coolant loops, pumps, heat exchangers, and
other auxiliary equipment as needed. The facility also may include
sufficient shielding to permit work on the reactor to proceed following
a short period of power interruption, and buildings as needed to house
the reactor and its auxiliary equipment. The erection and on-site
assembly of such a reactor facility is covered, but the components
whose characteristics are under study are excluded from coverage. To
illustrate, one of the SPETRs planned for studies of nuclear reactor
safety is designed to accommodate various internal fuel and control
assemblies. The internal structure of the pressure vessel is designed
so that cores of different shapes and sizes may be placed in the vessel
for investigation, or the entire internal structure may be easily
removed and replaced by a structure which will accept a different core
design. Similarly, the control rod assembly is arranged to provide for
flexibility in the removal of instrument leads and experimental
assemblies from within the core.
(4) Tests or experiments in peaceful uses of nuclear energy. These
tests or experiments are varied in nature and some are only in a
planning stage. They consist of one or more nuclear or nonnuclear
detonations for the purposes of acquiring data. The data can include
seismic effects, radiation effects, amount of heat generated, amount of
material moved and so forth. Some of these tests are conducted in
existing mines, while others are conducted in facilities specifically
constructed for the tests or experiments. In general, all work which
can be performed in accordance with customary drawings and
specifications, as well as other work in connection with preparation of
facilities is treated as covered work. Such work includes tunneling,
drilling, excavation and back-filling, erection of buildings or other
structures, and installation of utilities. The installation of the
nonnuclear material or nuclear device to be detonated, and the
instrumentation and connection between such material or device and the
instrumentation are treated as noncovered work.
(5) Tests or experiments in military uses of nuclear energy. As in
970.2204-1-1(c)(4), these tests or experiments can be varied in nature.
However, under this category it is intended to include only detonation
of nonnuclear material or nuclear devices. The material or devices can
be detonated either underground, at ground level, or above the ground.
These tests or experiments have been conducted in, on, or in connection
with facilities specifically constructed for such tests or experiments.
As in tests or experiments in peaceful uses of nuclear energy, all work
which can be performed in accord with customary drawings and
specifications, as well as other work in connection with preparation of
facilities are treated as covered work. Such work includes building
towers or similar structures, tunneling, drilling, excavation and
backfilling, erection of buildings or other structures, and
installation of utilities. The installation of the nonnuclear material
or nuclear devices and instrumentation are treated as noncovered work.
(d) Construction site contiguous to an established manufacturing
facility. As DOE-owned property sometimes encompasses several thousand
acres of real estate, a number of separate facilities may be located in
areas contiguous to each other on the same property. These facilities
may be built over a period of years, and established manufacturing
activities may be regularly carried on at one site at the same time
that construction of another facility is underway at another site. On
occasion, the regular manufacturing activities of the operating
contractor at the first site may include the manufacture, assembly, and
reconditioning of components and equipment which in other industries
would normally be done in established commercial plants. While the
manufacture of components and equipment in the manufacturing plant is
noncovered, the installation of any such manufactured items on a
construction job is covered.
970.2208 Equal employment opportunity.
The equal employment opportunity provisions of 48 CFR subpart 22.8
and subpart 922.8 of this chapter, including Executive Order 11246 and
41 CFR part 60, are applicable to DOE management and operating
contracts.
970.2210 Service Contract Act.
The Service Contract Act of 1965 is not applicable to contracts for
the management and operation of DOE facilities, but it is applicable to
subcontracts under such contracts (see 48 CFR 970.5244-1).
970.2270 Unemployment compensation.
(a) Each state has its own unemployment compensation system to
provide payments to workers who
[[Page 81027]]
become unemployed involuntarily and through no fault of their own.
Funds are provided for unemployment compensation benefits through a
payroll tax on employers. Most DOE contractors are subject to the
unemployment compensation tax laws of the states in which they are
located. It is the policy to assure, both in the negotiation and
administration of cost-reimbursement type contracts, that economical
and practical arrangements are made and practiced with respect to
unemployment compensation.
(b) Contract exempt from state laws. (1) Some contractors are
exempt from state unemployment compensation laws, usually on grounds
that they are nonprofit organizations or subdivisions of State
governments. Most states, however, permit such employers to elect
unemployment compensation coverage on a voluntary basis. Under such
circumstances, all existing or prospective cost-reimbursement
contractors shall be encouraged to provide unemployment compensation
coverage or equivalent substitutes.
(2) It is also DOE policy that, prior to the award or extension of
a management and operating contract, exempt contractors or prospective
contractors shall be required to submit to the contracting officer a
statement that they will either elect coverage or provide equivalent
substitutes for unemployment compensation, or in the alternative,
submit evidence that it is impractical to do so. If any exempt
contractor or prospective contractor submits that it is impractical to
elect coverage or to provide an equivalent substitute, appropriate
Office of Contract and Resource Management, within the Headquarters
procurement organization, staff shall review that position prior to
recommending an award or extension of the contract. If there are
substantial reasons for not electing coverage or for not providing
equivalent substitutes, a contract may be awarded or extended.
Headquarters' staff review and recommendation shall be based on such
factors as:
(i) The specific provisions of the unemployment compensation law of
the State;
(ii) The extent to which the establishment of special conditions on
DOE work may have an adverse effect on the contractor's general
policies and operating costs in its private operations;
(iii) The numerical relationship between the contractor's private
work force and its employees performing only work for DOE;
(iv) The contractor's record with respect to work force stability
and the general outlook with respect to future work force stability;
(v) In a replacement contractor situation, whether or not the prior
contractor had coverage or suitable substitutes; and
(vi) The particular labor relations implications involved.
Subpart 970.23--Environmental, Conservation, and Occupational
Safety Programs
970.2303 Hazardous materials identification and material safety.
970.2303-1 General.
(a) The Department of Energy regulates the nuclear safety of its
major facilities under its own statutory authority derived from the
Atomic Energy Act and other legislation. The Department also regulates,
under certain specific conditions, the use by its contractors of
radioactive materials and ionizing radiation producing machines.
(b) The inclusion of environmental, safety and health clauses in
DOE contracts shall be made by the contracting officer in accordance
with this subpart and in consultation with appropriate environmental,
safety and health program management personnel.
970.2303-2 Contract clauses.
(a) When work under management and operating contracts and
subcontracts thereunder is to be performed at a facility where DOE will
exercise its statutory authority to enforce occupational safety and
health standards applicable to the working conditions of the contractor
and subcontractor employees at such facility, the clause at 48 CFR
970.5223-1, Integration of Environment, Safety and Health into Work
Planning and Execution, shall be used in such contract or subcontract
and made applicable to the work if conditions in paragraphs (a)(1)
through (3) of this section, are satisfied:
(1) DOE work is segregated from the contractor's or subcontractor's
other work;
(2) The operation is of sufficient size to support its own safety
and health services; and
(3) The facility is government-owned, or leased by or for the
account of the government.
(b) The clause set forth in 952.223-72, Radiation Protection and
Nuclear Criticality, shall be included in those contracts or
subcontracts for, and be made applicable to, work to be performed at a
facility where DOE does not elect to assert its statutory authority to
enforce occupational safety and health standards applicable to the
working conditions of contractor and subcontractor employees, but does
need to enforce radiological safety and health standards pursuant to
provisions of the contract or subcontract rather than by reliance upon
Nuclear Regulatory Commission licensing requirements (including
agreements with States under section 274 of the Atomic Energy Act).
970.2304 Use of recovered/recycled materials.
970.2304-1 General.
The policy for the acquisition and use of environmentally
preferable products and services is described at 48 CFR subpart 923.4.
970.2304-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5223-
2, Acquisition and Use of Environmentally Preferable Products and
Services, in management and operating contracts.
970.2305 Workplace substance abuse programs--management and operating
contracts.
970.2305-1 General.
(a) The Department of Energy (DOE), as part of its overall
responsibilities to protect the environment, maintain public health and
safety, and safeguard the national security, has established policies,
criteria, and procedures for management and operating contractors to
develop and implement programs that help maintain a workplace free from
the use of illegal drugs.
(b) Regulations concerning DOE's management and operating
contractor workplace substance abuse programs are promulgated at 10 CFR
part 707, Workplace Substance Abuse Programs at DOE Sites.
970.2305-2 Applicability.
(a) All management and operating contracts awarded under the
authority of the Atomic Energy Act of 1954, as amended, are required to
implement the policies, criteria, and procedures of 10 CFR part 707,
Workplace Substance Abuse Programs at DOE Sites.
(b) Except as otherwise provided for in this subpart, management
and operating contracts subject to the requirements of 10 CFR part 707
and this subpart shall not be subject to 48 CFR 23.5, Drug Free
Workplace.
970.2305-3 Definitions.
Terms and words relating to DOE's Workplace Substance Abuse
Programs, as used in this section, have the same meanings assigned to
such terms and words in 10 CFR part 707.
[[Page 81028]]
970.2305-4 Solicitation provision and contract clause.
(a) The contracting officer shall insert the provision at 48 CFR
970.5223-3, Agreement Regarding Workplace Substance Abuse Programs at
DOE Sites, in solicitations for the management and operation of DOE-
owned or -controlled sites operated under the authority of the Atomic
Energy Act of 1954, as amended.
(b) The contracting officer shall insert the clause at 970.5223-4,
Workplace Substance Abuse Programs at DOE Sites, in contracts for the
management and operation of DOE-owned or -controlled sites operated
under the authority of the Atomic Energy Act of 1954, as amended.
970.2306 Suspension of payments, termination of contract, and
debarment and suspension actions.
(a) The contracting officer shall comply with the procedures of 48
CFR 23.506 regarding the suspension of contract payments, the
termination of the contract for default, and the debarment and
suspension of a contractor relative to failure to comply with the
clause at 48 CFR 970.5223-4, Workplace Substance Abuse Programs at DOE
Sites.
(b) For purposes of 10 CFR part 707, the specific causes for
suspension of contract payments, termination of the contract for
default, and debarment and suspension of the contractor are:
(1) The contractor fails to either comply with the requirements of
10 CFR part 707 or perform in a manner consistent with its approved
program;
(2) The contractor has failed to comply with the terms of the
provision at 48 CFR 970.5223-3, Agreement Regarding Workplace Substance
Abuse Programs at DOE Sites;
(3) Such a number of contractor employees having been convicted of
violations of criminal drug statutes for violations occurring on the
DOE-owned or -controlled site, as to indicate that the contractor has
failed to make a good faith effort to provide a drug free workplace;
or,
(4) The offeror has submitted a false certification in response to
the provision at 48 CFR 970.5223-3, Agreement Regarding Workplace
Substance Abuse Programs at DOE Sites.
Subpart 970.26--Other Socioeconomic Programs
970.2670 Implementation of Section 3021 of the Energy Policy Act of
1992.
970.2670-1 Requirements.
The goal requirements of section 3021 of the Energy Policy Act of
1992, and the attendant reporting requirements shall be included in the
subcontracting plan for the management and operating contract and shall
apply to the annual dollar obligations specifically provided to the
contractor for competitively awarded subcontracts that fulfill Energy
Policy Act requirements.
970.2671 Diversity.
970.2671-1 Policy.
Department of Energy policy recognizes that full utilization of the
talents and capabilities of a diverse work force is critical to the
achievement of its mission. The principal goals of this policy are to
foster and enhance partnerships with small, small disadvantaged, women-
owned small businesses, and educational institutions; to match
capabilities with existing opportunities; to track small, small
disadvantaged, women-owned small business, and educational activity;
and to develop innovative strategies to increase opportunities.
970.2671-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5226-
1, Diversity Plan, in all management and operating contracts.
970.2672 Implementation of Section 3161 of the National Defense
Authorization Act for Fiscal Year 1993.
970.2672-1 Policy.
Consistent with the objectives of section 3161 of the National
Defense Authorization Act for Fiscal Year 1993, 42 U.S.C. 7274h, in
instances where the Department of Energy has determined that a change
in work force at a DOE Defense Nuclear Facility is necessary, DOE
contractors and subcontractors at DOE Defense Nuclear Facilities shall
accomplish work force restructuring or displacement so as to mitigate
social and economic impacts and in a manner consistent with any DOE
work force restructuring plan in effect for the facility or site. In
all cases, mitigation shall include the requirement for hiring
preferences for employees whose positions have been terminated (except
for termination for cause) as a result of changes to the work force at
the facility due to restructuring accomplished under the requirements
of section 3161. Where applicable, contractors may take additional
actions to mitigate consistent with the Department's Workforce
Restructuring Plan for the facility or site.
970.2672-2 Requirements.
The requirements set forth in 48 CFR 926.71, Implementation of
Section 3161 of the National Defense Authorization Act for Fiscal Year
1993, for contractors and subcontractors to provide a hiring preference
for employees under Department of Energy contracts whose employment in
positions at a Department of Energy Defense Nuclear Facility is
terminated (except for a termination for cause) applies to management
and operating contracts.
970.2672-3 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5226-
2, Workforce Restructuring Under Section 3161 of the National Defense
Authorization Act for Fiscal Year 1993, in contracts for the management
and operation of Department of Energy Defense Nuclear Facilities and,
as appropriate, in other contracts that include site management
responsibilities at a Department of Energy Defense Nuclear Facility.
970.2673 Regional partnerships.
970.2673-1 Policy.
It is the policy of the DOE to be a constructive partner in the
geographic region in which DOE conducts its business. The basic
elements of this policy include:
(a) Recognizing the diverse interests of the region and its
stakeholders,
(b) Engaging regional stakeholders in issues and concerns of mutual
interest, and
(c) Recognizing that giving back to the community is a worthwhile
business practice.
970.2673-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5226-
3, Community Commitment, in all management and operating contracts.
Subpart 970.27--Patents, Data, and Copyrights
970.2701 General.
970.2701-1 Applicability.
This subpart applies to negotiation of patent rights, rights in
technical data provisions and other related provisions for the
Department of Energy contracts for the management and operation of
DOE's major sites or facilities, including the conduct of research and
development and nuclear weapons production, and contracts which involve
major, long-term or continuing activities conducted at a DOE site.
970.2702 Patent related clauses.
970.2702-1 Authorization and consent.
Contracting officers must use the clause at 970.5227-4,
Authorization and Consent, instead of the clause at 48 CFR 52.227-1.
[[Page 81029]]
970.2702-2 Notice and assistance regarding patent and copyright
infringement.
Contracting officers must use the clause at 970.5227-5, Notice and
Assistance Regarding Patent and Copyright Infringement, instead of the
clause at 48 CFR 52.227-2.
970.2702-3 Patent indemnity.
(a) Contracting officers must use the clause at 970.5227-6, Patent
Indemnity--Subcontracts to assure that subcontracts appropriately
address patent indemnity.
(b) Normally, the clause at 48 CFR 52.227-3 would not be
appropriate for an M&O contract; however, if there is a question, such
as when the mission of the contractor involves production, the
contracting officer must consult with local patent counsel and use the
clause where appropriate.
970.2702-4 Royalties.
Contracting officers must use the solicitation provision at
970.5227-7, Royalty Information, and the clause at 970.5227-8, Refund
of Royalties instead of the provision at 48 CFR 52.227-8 and the clause
at 48 CFR 52.227-9, respectively.
970.2702-5 Rights to proposal data.
Contracting officers must include the clause at 48 CFR 52.227-23,
Rights to Proposal Data, in all solicitations and contracts for the
management and operation of DOE sites and facilities.
970.2702-6 Notice of right to request patent waiver.
Contracting officers must include the provision at 970.5227-9 in
all solicitations for contracts for the management and operation of DOE
sites or facilities.
970.2703 Patent rights.
970.2703-1 Purposes of patent rights clauses.
(a) DOE sites and facilities are managed and operated on behalf of
the Department of Energy by a contractor, pursuant to management and
operating contracts that are generally awarded for a five (5) year
term, with the possibility for renewal. Special provisions relating to
patent rights are appropriately incorporated into an M&O contract
because of the unique circumstances and responsibilities of managing
and operating a Government-owned facility, as compared to other
federally funded research and development contracts.
(b)(1) Technology transfer mission clause. In accordance with
Public Law 101-189, section 3133(d), DOE may grant technology transfer
authority to M&O contractors operating a DOE facility. Generally, M&O
contractors have the right to elect to retain title to inventions made
under the contract, whether a nonprofit or educational organizations,
as a result of 35 U.S.C. 200 et seq. (Bayh-Dole Act), or a large
business, as a result of a class patent waiver issued pursuant to 10
CFR part 784. Under such contracts, the M&O contractor assumes
responsibilities for commercializing retained inventions, in accordance
with the Technology Transfer Mission clause provided at 970.5227-3.
That clause also governs such activities as the distribution of
royalties earned from inventions made under the contract and the
transfer of patent rights in inventions made under the contract to
successor contractors.
(2) If the M&O contractor is a nonprofit organization or small
business firm having technology transfer authority, the following
clauses are inserted into the M&O contract: 970.5227-3 and 970.5227-10.
(3) If the M&O contract has technology transfer as a mission and is
to be performed by a for-profit, large business firm that has been
granted an advance class waiver, the following clauses are inserted
into the M&O contract: 970.5227-3 and 970.5227-12. The terms of the
clause at 970.5227-12 are subject to modification to conform to the
terms of the class waiver.
(4) If the M&O contract does not have a technology transfer mission
and is to be performed by a for-profit, large business firm and does
not have advance class waiver under 10 CFR part 784, the patent rights
clause at 970.5227-11 is inserted into the M&O contract, and the
Technology Transfer Mission clause is inapplicable.
(5) If the contractor is an educational institution, a non-profit
organization or a small business firm and is conducting privately
funded technology transfer activities, involving the use of private
funds to conduct licensing and marketing activities related to
inventions made under the contract in accordance with the Bayh-Dole
Act, DOE may modify the patent rights clause (970.5227-10) to address
issues such as the disposition of royalties earned under the privately
funded technology transfer program, the transfer of patent rights to a
successor contractor, allowable cost restrictions concerning privately
funded technology transfer activities, and the Government's freedom
from any liability related to licensing under the contractor's
privately funded technology transfer program.
(c) Contracting officers must consult with DOE patent counsel
assisting the contracting activity or the Assistant General Counsel for
Technology Transfer and Intellectual Property for assistance in
selecting for use in the solicitation, negotiating, or approving
appropriate patent rights clauses for a M&O contract. It may be
appropriate to include more than one patent rights clause in a
solicitation if the successful contractor could, for instance, be
either an educational or a large business. If a large business may be
selected for performance of a contract that will include a technology
transfer clause, the solicitation must include the clause at 970.5227-
12 to reflect the waiver that will likely be granted. If the
solicitation includes more than one patent clause, it must include an
explanation of the circumstances under which the appropriate clause
will be used. The final award must contain only one patent rights
clause.
970.2703-2 Patent rights clause provisions for management and
operating contractors.
(a) Allocation of Principal Rights: Bayh-Dole provisions. If the
management and operating contractor is an educational institution or
nonprofit organization, the patent rights clause provided at 970.5227-
10 must be inserted into the M&O contract. Such entities are
beneficiaries of Bayh-Dole Act, including the paramount right of the
contractor to elect to retain title to inventions conceived or first
actually reduced to practice in performance of work under the contract,
except in DOE-exempted areas of technology or in operation of DOE
facilities primarily dedicated to naval nuclear propulsion or weapons
related programs.
(b) Allocation of Principal Rights: Government title. (1) The
patent rights clause provided at 970.5227-11 must be incorporated into
the M&O contract if the contractor is a for-profit, large business firm
and the contract does not have a technology transfer mission or if,
without regard to the type of contractor, the contract is for the
operation of a DOE facility primarily dedicated to naval nuclear
propulsion or weapons related programs. That clause provides for DOE's
statutory obligation to take title to inventions conceived or first
actually reduced to practice in the course of or under an M&O contract,
and does not contemplate an advance class waiver of Government rights
in inventions, or participation by the contractor in technology
transfer activities.
(2) While only in rare circumstances does a for-profit large
business contractor whose contract contains no technology transfer
mission receive
[[Page 81030]]
rights in or title to inventions made under the contract, the
contractor does have the right to request a license or foreign patent
rights in inventions made under the contract, and may petition for a
waiver of Government rights in identified inventions. The patent rights
clause 970.5227-11 does not include many of the provisions of patent
rights clauses 970.5227-10 and 970.5227-12, related to the filing of
patent applications by the contractor, the granting of rights in
inventions by the contractor to third parties (preference for United
States industry), and conditions allowing the Government to grant
licenses to third parties in inventions retained by the contractor
(march-in rights). Any instrument granting rights in inventions made
under a contract governed by patent rights clause 970.5227-11 must
include these additional provisions within its terms and conditions.
(c) Allocation of Principal Rights: Contractor right to elect title
under an advance class waiver. If the M&O contractor is a for-profit,
large business firm and the Government has granted an advance class
waiver of Government rights in inventions made in the course of or
under the M&O contract, under the authority of the Atomic Energy Act of
1954 (42 U.S.C. 2182) and the Federal Nonnuclear Energy Act of 1974 (42
U.S.C. 5908(c)), the patent rights clause provided at 970.5227-12 must
be inserted into the M&O contract, unless the terms and conditions of
such an approved waiver alter or replace the patent rights clause
provisions pursuant to 10 CFR part 784.
(d) Extensions of time--DOE discretion. The patent rights clauses
for M&O contracts require the contractor to take certain actions within
prescribed time periods to comply with the contract and preserve its
rights in inventions. The M&O contractor may request extensions of time
in which to take such actions by submitting written justification to
DOE, and DOE may grant the contractor's requests, on a case-by-case
basis. If the time period expired due to negligence by the contractor,
DOE may grant a request for an extension of time upon a showing by the
contractor that corrective procedures are in place to avoid such
negligence in the future. If a contractor is requesting an extension of
time in which to elect to retain title to an invention, DOE may grant
the request if the extension allows the contractor to conduct further
experimentation, market research, or other analysis helpful to
determine contractor interest in electing title to the invention, among
other considerations. Generally, the extensions of time are for periods
of between six (6) months to one (1) year.
(e) Facilities license. These include the rights to make, use,
transfer, or otherwise dispose of all articles, materials, products, or
processes embodying inventions or discoveries used or embodied in the
facility regardless of whether or not conceived or first actually
reduced to practice under or in the course of such a contract. The
patent rights clauses, 970.5227-10, 970.5227-11, 970.5227-12, each
contain a provision granting the Government this facilities license.
(f) Deletion of classified inventions provision. If DOE determines
that the research, development, demonstration or production work to be
performed during the course of a management and operating contract most
probably will not involve classified subject matter or result in any
inventions that require security classification, DOE patent counsel may
advise the contracting officer to delete the patent rights clause
provision entitled, ``Classified Inventions'' from the M&O contract.
(g) Alternate 1--Weapons Related Research or Production. If DOE
grants technology transfer authority to a DOE facility, pursuant to
Public Law 101-189, section 3133(d), and the DOE owned facility is
involved in weapons related research and development, or production,
then Alternate 1 of the patent rights clauses must be inserted into the
M&O contract. Alternate 1 defines weapons related subject inventions
and restricts the contractor's rights with respect to such inventions.
970.2704 Rights in data.
970.2704-1 General.
(a) Rights in data relating to the performance of the contract and
to all facilities are significant in assuring continuity of the
management and operation of DOE facilities. It is crucial in assuring
DOE's continuing ability to perform its statutory missions that DOE
obtain rights to all data produced or specifically used by its
management and operating contractors and appropriate subcontractors. In
order to obtain the necessary rights in technical data, DOE contracting
officers shall assure that management and operating contracts contain
either the Rights in Data clause at 48 CFR 970.5227-1, Rights in Data--
Facilities, or the clause at 48 CFR 970.5227-2, Rights in Data--
Technology Transfer. Selection of the appropriate clause is dependent
upon whether technology transfer is a mission of the management and
operating contract pursuant to the National Competitiveness Technology
Transfer Act of 1989, Public Law 101-189, (15 U.S.C. 3711 et seq., as
amended). If technology transfer is not a mission of the management and
operating contract, the clause at 48 CFR 970.5227-1, Rights in Data--
Facilities, shall be used. In those instances in which technology
transfer is a mission of the contract, the clause at 48 CFR 970.5227-2,
Rights in Data--Technology Transfer, shall be used.
(b) Employees of the management and operating contractor may not be
used to assist in the preparation of a proposal or bid for services
which are similar or related to those being performed under the
contract, which are to be performed by the contractor or its parent or
affiliate organization for commercial customers unless the employee has
been separated from work under the DOE contract for such period as the
Head of the Contracting Activity or designee shall have directed.
970.2704-2 Procedures.
(a) The clauses at 48 CFR 970.5227-1, Rights in Data-Facilities,
and 48 CFR 970.5227-2, Rights in Data--Technology Transfer, both
provide generally for Government ownership and for unlimited rights in
the Government for all data first produced in the performance of the
contract and unlimited rights in data specifically used in the
performance of the contract. Both clauses provide that, subject to
patent, security, and other provisions of the contract, the contractor
may use contract data for its private purposes. The contractor, under
either clause, must treat any data furnished by DOE or acquired from
other Government agencies or private entities in the performance of
their contracts in accordance with any restrictive legends contained
therein.
(b) Since both clauses secure access to and, if requested, delivery
of technical data used in the performance of the contract, there is
generally no need to use the Additional Technical Data Requirements
clause at 48 CFR 52.227-16 in the management and operating contract.
(c)(1) Paragraph (d) of the clause at 48 CFR 970.5227-1, Rights in
Data--Facilities, and paragraph (f) of the clause at 48 CFR 970.5227-2,
Rights in Data--Technology Transfer, provide for the inclusion in
subcontracts of the Rights in Technical Data--General clause at 48 CFR
52.227-14, with Alternate V, and modified in accordance with DEAR
927.409. Those clauses also provide for the inclusion in appropriate
subcontracts Alternates II, III, and IV to the clause at 48 CFR 52.227-
14 with DOE's prior approval and the inclusion
[[Page 81031]]
of the Additional Technical Data Requirements clause at 48 CFR 52.227-
16 in all subcontracts for research, development, or demonstration and
all other subcontracts having special requirements for the production
or delivery of data. In subcontracts, including subcontracts for
related support services, involving the design or operation of any
plants or facilities or specially designed equipment for such plants or
facilities that are managed or operated by the contractor under its
contract with DOE, the management and operating contractor shall use
the Rights in Data--Facilities clause at 48 CFR 970.5227-1.
(2) Where, however, a subcontract is to be awarded by the
management and operating contractor in connection with a program, as
discussed at 927.404-70, which provides statutory authority to protect
from public disclosure, data first produced under contracts awarded
pursuant to the program, contracting officers shall ensure that the
management and operating contractor includes in that subcontract the
rights in data clause provided by DOE Patent Counsel, consistent with
any accompanying guidance.
(3) Management and operating contractors and higher-tier
subcontractors shall not use their power to award subcontracts as
economic leverage to acquire rights in a subcontractor's limited rights
data or restricted computer software for their private use, nor may
they acquire rights in a subcontractor's limited rights data or
restricted computer software except through the use of Alternate II or
III to the clause at 48 CFR 52.227-14, respectively, without the prior
approval of DOE Patent Counsel.
(d)(1) Paragraphs (e) and (f) of the clause at 48 CFR 970.5227-1,
Rights in Data--Facilities, and paragraphs (g) and (h) of the clause at
48 CFR 970.5227-2, Rights in Data--Technology Transfer, provide for the
contractor's granting a nonexclusive license in any limited rights data
and restricted computer software specifically used in performance of
the contract.
(2) In certain instances the objectives of DOE would be frustrated
if the Government did not obtain, at the time of contracting, limited
license rights on behalf of responsible third parties and the
Government, and to limited rights data or restricted computer software
or both necessary for the practice of subject inventions or data first
produced or delivered in the performance of the contract. This
situation may arise in the performance of management and operating
contracts and contracts for the management or operation of a DOE
facility or site. Contracting officers should consult with program
officials and Patent Counsel. No such rights should be obtained from a
small business or non-profit organization, unless similar rights in
background inventions of the small business or non-profit organization
have been authorized in accordance with 35 U.S.C. 202(f). Where such a
background license is in DOE's interest, a provision that provides
substantially as Alternate VI at 48 CFR 952.227-14 should be added to
the appropriate clause, 48 CFR 970.5227-1, Rights in Data--Facilities,
or 48 CFR 970.5227-2, Rights in Data--Technology Transfer.
(e) The Rights in Data--Technology Transfer clause at 48 CFR
970.5227-2 differs from the clause at 48 CFR 970.5227-1, Rights in
Data--Facilities, in the context of its more detailed treatment of
copyright. In management and operating contracts that have technology
transfer as a mission, the right to assert copyright in data first
produced under the contract will be a valuable right, and
commercialization of such data, including computer software, will
assist the management and operating contractor in advancing the
technology transfer mission of the contract. The clause at 48 CFR
970.5227-2, Rights in Data--Technology Transfer, provides for DOE
approval of DOE's taking a limited copyright license for a period of
five years, and, in certain rare cases, specified longer periods in
order to contribute to commercialization of the data.
(f) Contracting officers should consult with Patent Counsel to
assure that requirements regarding royalties and conflicts of interest
associated with asserting copyright in data first produced under the
contract are appropriately addressed in the Technology Transfer Mission
clause (48 CFR 970.5227-3) of the management and operating contract.
Where it is not otherwise clear which DOE program funded the
development of a computer software package, such as where the
development was funded out of a contractor's overhead account, the DOE
program which was the primary source of funding for the entire contract
is deemed to have administrative responsibility. This issue may arise,
among others, in the decision whether to grant the contractor
permission to assert copyright. See paragraph (e) of the Rights in
Data--Technology Transfer clause at 970.5227-2.
(g) In management and operating contracts involving access to DOE-
owned Category C-24 restricted data, as set forth in 10 CFR part 725,
DOE has reserved the right to receive reasonable compensation for the
use of its inventions and discoveries, including its related restricted
data and technology. Alternate I to each clause shall be used where
access to Category C-24 restricted data is contemplated in the
performance of a contract.
970.2704-3 Contract clauses.
(a) The contracting officer shall insert the clause at 48 CFR
970.5227-1, Rights in Data--Facilities, in management and operating
contracts which do not contain the clause at 48 CFR 970.5227-2, Rights
in Data--Technology Transfer. The contracting officer shall include the
clause with its Alternate I in contracts where access to Category C-24
restricted data, as set forth in 10 CFR part 725, is to be provided to
contractors.
(b) The contracting officer shall insert the clause at 970.5227-2,
Rights in Data--Technology Transfer, in management and operating
contracts which contain the clause at 970.5227-3, Technology Transfer
Mission. The contracting officer shall include the clause with its
Alternate I in contracts where access to Category C-24 restricted data,
as set forth in 10 CFR part 725, is to be provided to contractors.
970.2770 Technology Transfer.
970.2770-1 General.
This subpart prescribes policies and procedures for implementing
the National Competitiveness Technology Transfer Act of 1989, Public
Law 101-189, (15 U.S.C. 3711 et seq., as amended). The Act requires
that technology transfer be established as a mission of each
Government-owned laboratory operated under contract by a non-Federal
entity. The National Defense Authorization Act for Fiscal Year 1994
expanded the definition of ``laboratory'' to include weapon production
facilities that are operated for national security purposes and are
engaged in the production, maintenance, testing, or dismantlement of a
nuclear weapon or its components.
970.2770-2 Policy.
All new awards for or extensions of existing DOE laboratory or
weapon production facility management and operating contracts shall
have technology transfer, including authorization to award Cooperative
Research and Development Agreements (CRADAs), as a laboratory or
facility mission under Section 11(a)(1) of the Stevenson-Wydler
Technology Innovation Act of 1980, Public Law 96-480 (15 U.S.C. 3701 et
seq., as amended). A management and operating contractor for a facility
not deemed to be a laboratory or weapon production
[[Page 81032]]
facility may be authorized on a case-by-case basis to support the DOE
technology transfer mission including, but not limited to,
participating in CRADAs awarded by DOE laboratories and weapon
production facilities.
970.2770-3 Technology transfer and patent rights.
The National Competitiveness Technology Transfer Act of 1989
(NCTTA) established technology transfer as a mission for Government-
owned, contractor-operated laboratories, including weapons production
facilities, and authorizes those laboratories to negotiate and award
cooperative research and development agreements with public and private
entities for purposes of conducting research and development and
transferring technology to the private sector. In implementing the
NCTTA, DOE has negotiated technology transfer clauses with the
contractors managing and operating its laboratories. Those technology
transfer clauses must be read in concert with the patent rights clause
required by this subpart. Thus, each management and operating
contractor holds title to subject inventions for the benefit of the
laboratory or facility being managed and operated by that contractor.
970.2770-4 Contract clause.
(a) The contracting officer shall insert the clause at 970.5227-3,
Technology Transfer Mission, in each solicitation for a new or an
extension of an existing laboratory or weapon production facility
management and operating contract.
(b) If the contractor is a nonprofit organization or small business
eligible under 35 U.S.C. 200 et seq., to receive title to any
inventions under the contract and proposes to fund at private expense
the maintaining, licensing, and marketing of the inventions, the
contracting officer shall use the basic clause with its Alternate I.
(c) If the facility is operated for national security purposes and
engaged in the production, maintenance, testing, or dismantlement of a
nuclear weapon or its components, the contracting officer shall use the
basic clause with its Alternate II.
Subpart 970.28--Bonds and Insurance
970.2803 Insurance.
970.2803-1 Workers' Compensation Insurance.
(a) Policies and requirements. (1) Workers' compensation insurance
protects employers against liability imposed by workers' compensation
laws for injury or death to employees arising out of, or in the course
of, their employment. This type of insurance is required by state laws
unless employers have acceptable programs of self-insurance.
(2) Special requirements. Certain workers' compensation laws
contain provisions which result in limiting the protection afforded
persons subject to such laws. The policy with respect to these
limitations as they affect persons employed by management and operating
contractors is set forth as follows:
(i) Elective provisions. Some worker's compensation laws permit an
employer to elect not to be subject to its provisions. It is DOE policy
to require these contractors to be subject to workers' compensation
laws in jurisdictions permitting election.
(ii) Statutory immunity. Under the provisions of some workers'
compensation laws, certain types of employers; e.g., nonprofit
educational institutions, are relieved from liability. If a contractor
has a statutory option to accept liability, it is DOE policy to require
the contractor to do so.
(iii) Limited medical benefits. Some workers' compensation laws
limit the liability of the employer for medical care to a maximum
dollar amount or to a specified period of time. In such cases, a
contractor's workers' compensation insurance policy should contain a
standard extrastatutory medical coverage endorsement.
(iv) Limits on occupational disease coverage and employers'
liability. Some workers' compensation laws do not provide coverage for
all occupational diseases. In such situations, a contractor's workers'
compensation insurance policy should contain voluntary coverage for all
occupational diseases.
(3) Contractor ``employees' benefit plan''--self-insurers. The
policies and requirements set forth in paragraph (a)(2) of this section
apply where management and operating contractors purchase workers'
compensation insurance. With respect to self-insured contractors, the
objectives specified in paragraph (a)(2) also shall be met through
primary or excess workers' compensation and employers' liability
insurance policy(ies) or an approved combination thereof. ``Employees''
benefit plans'' which were established in prior years may be continued
to contrast termination at existing benefit levels.
(b) Assignment of responsibilities. (1) Office of Contract and
Resource Management, within the Headquarters procurement organization,
other officials, and the Heads of Contracting Activities, consistent
with their delegations of responsibility, shall assure management and
operating contracts are consistent with the policies and requirements
of paragraph (a) of this section.
(2) In discharging assigned responsibility, the Heads of
Contracting Activities shall:
(i) Periodically review workers' compensation insurance programs of
management and operating contractors in the light of applicable
workers' compensation statutes to assure conformance with the
requirements of paragraph (a) of this section.
(ii) Evaluate the adequacy of coverage of ``self-insured''
workers'' compensation programs;
(iii) Provide arrangements for the administration of any existing
``employees'' benefit plans until such plans'' are terminated; and
(iv) Submit to the Office of Contract and Resource Management,
within the Headquarters procurement organization, all proposals for the
modification of existing ``employees' benefit plans.''
(3) The Office of Contract and Resource Management, within the
Headquarters procurement organization, is responsible for approving
management and operating contractor ``employees' benefit plans.''
970.2803-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5228-
1, Insurance--Litigation and Claims, in all management and operating
contracts. Paragraphs (h)(3) and (j)(2) of that clause apply to a
nonprofit contractor only to the extent specifically provided in the
individual contract.
Subpart 970.29--Taxes
970.2902 Federal excise taxes.
970.2902-1 Exemptions from Federal excise taxes.
(a) The exemption respecting taxes on communication services or
facilities has been held to extend to such services when furnished to
DOE management and operating contractors who pay for such services or
facilities from advances made to them by DOE under their contracts.
(b) Where it is considered that a request for an additional
exemption in the performance of a management and operating contract
would be justified, a recommendation that such a request be made should
be forwarded to the Chief Financial Officer, Headquarters.
(c) Where tax exemption certificates are required in connection
with the taxes cited in this section, the Head of the Contracting
Activity will supply standard Government forms (SF 1094,
[[Page 81033]]
U.S. Tax Exemption Certificate) on request.
970.2903 State and local taxes.
970.2903-1 Applicability of state and local taxes to the government.
It is DOE policy to secure those immunities or exemptions from
state and local taxes to which it is entitled under the Federal
Constitution or state laws. In carrying out this policy, the Heads of
Contracting Activities shall:
(a) Take all necessary steps to preclude payment of any taxes for
which any of the immunities or exemptions cited in this subpart are
available. Advice of Counsel should be sought as to the availability of
such immunities or exemptions;
(b) Acquire directly and furnish to contractors as Government
furnished property, equipment, material, or services when, in the
opinion of the Head of the Contracting Activity:
(1) Such direct acquisition will result in substantial savings to
the Government, taking into consideration any additional administrative
costs;
(2) Such direct acquisition will not have a substantial adverse
effect on the relationship between DOE and its contractor; and
(3) Such direct acquisition will not have a substantial adverse
effect on the DOE program or schedules.
970.2904 Contract clauses.
970.2904-1 Management and operating contracts.
(a) Pursuant to 48 CFR 29.401-6(b), the clause at 48 CFR 52.229-10,
State of New Mexico Gross Receipts and Compensating Tax, is applicable
to management and operating contracts that meet the three conditions
stated. The contracting officer shall modify paragraph (b) of the
clause to replace the phrase ``Allowable Cost and Payment clause'' with
the phrase ``Payments and advances.''
(b) Contracting officers shall include the clause at 48 CFR
970.5229-1, State and Local Taxes, in management and operating
contracts.
Subpart 970.30--Cost Accounting Standards
970.3002 CAS program requirements.
970.3002-1 Applicability.
The provisions of 48 CFR part 30 and 48 CFR chapter 99 (FAR
Appendix) shall be followed for management and operating contracts.
Subpart 970.31--Contract Cost Principles and Procedures
970.3101-00-70 Scope of subpart.
(a) The Procurement Executive is responsible for developing and
revising the policy and procedures for the determination of allowable
costs reimbursable under a management and operating contract, and for
coordination with other Headquarters' offices having joint interests.
(b) The Head of the Contracting Activity is responsible for
following the policy, principles and standards set forth in this
subpart in establishing the compensation and reimbursement provisions
of contracts and subcontracts and for submission of deviations for
Headquarters consideration and approval.
970.3101-9 Advance agreements (DOE coverage-paragraph (i)).
(i) At any time, in accordance with the contract terms and
conditions, the contracting officer may pursue an advance agreement in
connection with any cost item under a contract.
970.3101-10 Cost certification.
(a) Certain contracts require certification of the costs proposed
for final payment purposes. Section 48 CFR 970.4207-03-02 states the
administrative procedures for the certification provisions and the
related contract clause prescription.
(b) If unallowable costs are included in final cost settlement
proposals, penalties may be assessed. Section 48 CFR 970.4207-03-02
states the administrative procedures for penalty assessment provisions
and the related clause prescription.
970.3102-3-70 Home office expenses.
(a) For on-site work, DOE's fee for management and operating
contracts, determined under the policy of and calculated per the
procedures in 48 CFR 970.1504-1-3, generally provides adequate
compensation for home or corporate office general and administrative
expenses incurred in the general management of the contractor's
business as a whole.
(1) DOE recognizes that some Home Office Expenses are incurred for
the benefit of a management and operating contract. DOE has elected to
recognize that benefit through fee due to the difficulty of determining
the dollar value applicable to any management and operating contract.
The difficulty arises because:
(i) The general construct of a management and operating contract
results in minimal Home Office involvement in the contract work, and
(ii) Conventional Home Office Expense allocation techniques that
use bases such as total operating costs, labor dollars, hours etc., are
not appropriate because they inherently assume significant contractor
investment (in terms of its own resources, such as, labor, material,
overhead, etc.). Contractor investments are minimal under DOE's
operating and management contracts. The contracts are totally financed
by DOE advance payments, and DOE provides government-owned facilities,
property, and other needed resources.
(2) From time to time, the fee for a management and operating
contract may not be adequate compensation for Home Office Expenses
incurred for the benefit of the contract. An indication that such a
case exists is the need for significant home office support to deal
with issues at the site that occur without the fault or negligence of
the contractor, for example, the need for home office legal support to
deal with third party, environmental, safety, or health issues.
(3) In such a case, the contracting officer, after obtaining the
HCA's approval, may consider a contractor request for additional
compensation. The contractor may request:
(i) Fee in addition to its normal fee (but see 48 CFR 970.1504-1-
3(b)(1) if the contract is for the management and operation of a
laboratory); or
(ii) Compensation on the basis of actual cost.
(4) Because the contract's fee provides some compensation for Home
Office Expenses, the contractor's request for additional compensation
must always be for an amount less than the Home Office Expenses that
are incurred for the benefit of the management and operating contract.
(b) For off-site work, the DOE allows Home Office Expenses under
architect-engineer, supply and research contracts with commercial
contractors performing the work in their own facilities. Home Office
Expenses may, however, be included for reimbursement under such DOE
off-site architect-engineer, supply and research contracts, only to the
extent that they are determined, after careful examination, to be
allowable, reasonable, and properly allocable to the work. Work
performed in a contractor's own facilities under a management and
operating or construction contract may likewise be allowed to bear the
properly allocable portion of allowable Home Office Expenses.
[[Page 81034]]
970.3102-05 Application of cost principles.
970.3102-05-4 Bonding costs. (DOE coverage-paragraph (d))
(d) The allowability of bonding costs shall be determined pursuant
to 48 CFR 970.5228-1, Insurance-litigation and claims.
970.3102-05-6 Compensation for personal services. (DOE coverage-
paragraphs (a) and (p))
(a)(6) In determining the reasonableness of compensation, the
compensation of each individual contractor employee normally need not
be subjected to review and approval. Generally, the compensation paid
individual employees should be left to the judgment of contractors
subject to the limitations of DOE-approved compensation policies,
programs, classification systems, and schedules, and amounts of money
authorized for wage and salary increases for groups of employees.
However, the contracting officer shall designate a compensation
threshold appropriate for the particular situation. The contract shall
specifically provide that contracting officer approval is required for
compensating an individual contractor employee above the threshold if a
total of 50 percent or more of such compensation is reimbursed under
DOE cost-type contracts. For purposes of designating the threshold,
total compensation includes only the employee's salary and cash bonus
or incentive compensation.
(7)(i) Reimbursable costs for compensation for personal services
are to be set forth in a personnel appendix which is a part of the
contract. This personnel appendix shall be negotiated using the
principles and policies of 48 CFR 31.205-6, Compensation, as
supplemented by this section, 970.3102-05-6, and other pertinent parts
of the DEAR. Costs that are unallowable under other contract terms
shall not be allowable as compensation for personnel services.
(ii) The personnel appendix sets forth in detail personnel costs
and related expenses allowable under the contract and documents
personnel policies, practices and plans which have been found
acceptable by the contracting officer. The contractor will advise DOE
of any proposed changes in any matters covered by these policies,
practices or plans which relate to personnel costs. The personnel
appendix may be modified from time to time in writing by mutual
agreement of the contractor and DOE without execution of an amendment
to the contract. Such modifications shall be evidenced by execution of
written numbered approval letters from the contracting officer or his
representative. Types of personnel costs and related expenses addressed
in the personnel appendix, or amendments thereto, are as follows:
Salaries and wages; bonuses and incentive compensation; overtime, shift
differential, holiday, and other premium pay for time worked; welfare
benefits and retirement programs; paid time off, and salaries and wages
to employees in their capacity as union stewards and committeemen for
time spent in handling grievances, or serving on labor management
(contractor) committees provided, however, that the contracting
officer's approval is required in each instance of total compensation
to an individual employee above an annual rate as specified in the
personnel appendix.
(p)(1) Notwithstanding the costs cited in this subsection, incurred
for compensation of a senior executive in excess of the benchmark
compensation amount determined applicable for the contractor fiscal
year by the Administrator, Office of Federal Procurement Policy, are
unallowable. Allowable costs of executive compensation shall be
determined pursuant to Federal Acquisition Regulation 31.205-6(p).
970.3102-05-18 Independent research and development and bid and
proposal costs. (DOE coverage-paragraphs (c)).
(c) Independent Research and Development and Bid and Proposal costs
are unallowable. However, contracting officer approved Laboratory
Directed Research and Development costs and those costs incurred in
support of the Department's various reimbursable programs are
allowable.
970.3102-05-19 Insurance and indemnification.
The supplemental material on the costs of insurance and
indemnification is found in 48 CFR 970.5228-1, Insurance-Litigation and
Claims.
970.3102-05-22 Lobbying and political activity costs. (DOE coverage-
paragraph(b)).
(b) Costs of the following activities are excepted from 48 CFR
31.205-22, Lobbying and political activity costs, coverage, provided
that the resultant costs are reasonable and otherwise fall into the
following exceptions:
(1) Providing Members of Congress, their staff members or staff of
cognizant legislative committees, in response to a request (written or
oral, prior or contemporaneous) from Members of Congress, their staff
members or staff of cognizant legislative committees, or as otherwise
directed by the Contracting Officer, information or expert advice of a
factual, technical, or scientific nature, with respect to topics
directly related to the performance of the contract or proposed
legislation. In providing this information or expert advice, the
contractor shall indicate to the recipient that it is not presenting
the views of DOE. Reasonable costs for transportation, lodging or meals
incurred by contractor employees for the purpose of providing such
information or expert advice shall also be reimbursable, provided the
request for such information or expert advice is a prior written
request signed by a Member of Congress.
(2) Providing State legislatures or subdivisions thereof, their
staff members, or staff of cognizant legislative committees, in
response to a prior written request from a State legislator, or as
otherwise directed by the Contracting Officer, information or expert
advice of a factual, technical, or scientific nature, with respect to
topics directly related to the performance of the contract or proposed
legislation. In providing this information or expert advice, the
contractor shall indicate to the recipient that it is not presenting
the views of DOE. Reasonable costs for transportation, lodging, or
meals incurred by contractor employees shall be reimbursable.
970.3102-05-28 Other business expenses. (DOE coverage-paragraph (i)).
(i) Reasonable costs associated with the establishment and
maintenance of financial institution accounts in connection with the
work hereunder are allowable, including, but not limited to, service
charges, the cost of disbursing cash, necessary guards, cashiers, and
paymasters. If payments to employees are made by check, facilities and
arrangements for cashing checks may be provided without expense to the
employees, subject to the approval of the contracting officer.
970.3102-05-30 Patent costs and technology transfer costs.
(a) For management and operating contracts that do not include the
clause at 970.5227-3, Technology Transfer Mission, the cost principle
at 48 CFR 31.205-30 applies.
(b) For management and operating contracts that do include the
clause at 970.5227-3, Technology Transfer Mission, the following patent
and technology transfer costs are allowable:
(1) Costs of preparing invention disclosures, reports, and other
patent related documents required by the contract;
[[Page 81035]]
(2) Costs of searching the art relating to invention disclosures;
(3) Costs incurred in connection with the filing and prosecution of
patent applications for subject inventions, except where those costs
are incurred as part of a privately funded technology transfer program
recognized under the contract; and
(4) Other costs incurred in accordance with the patent rights
clause and the Technology Transfer Mission clause included in the
contract.
970.3102-05-46 Travel costs.
(a) Costs for transportation, lodging, meals, and incidental
expenses.
(1) Costs incurred by contractor personnel on official company
business are allowable, subject to the limitations contained in this
subsection. Costs for transportation may be based on mileage rates,
actual costs incurred, or on a combination thereof, provided the method
used results in a reasonable charge. Costs for lodging, meals, and
incidental expenses may be based on per diem, actual expenses, or a
combination thereof, provided the method used results in a reasonable
charge.
(2) Except as provided in paragraph (a)(3) of this subsection,
costs incurred for lodging, meals, and incidental expenses (as defined
in the regulations cited in paragraphs (a)(2)(i) through (iii) of this
subsection) shall be considered to be reasonable and allowable only to
the extent that they do not exceed on a daily basis the maximum per
diem rates in effect at the time of travel as set forth in the--
(i) Federal Travel Regulation, prescribed by the General Services
Administration (41 CFR chapters 300 through 304), for travel in the
conterminous 48 United States, available on a subscription basis from
the Superintendent of Documents, U.S. Government Printing Office,
Washington, DC 20402, Stock No. 922-002-00000-2;
(ii) Joint Travel Regulations, DoD Civilian Personnel, Appendix A,
prescribed by the Department of Defense, for travel in Alaska, Hawaii,
The Commonwealth of Puerto Rico, and territories and possessions of the
United States, available on a subscription basis from the
Superintendent of Documents, U.S. Government Printing Office,
Washington, DC 20402, Stock No. 908-010-00000-1; or
(iii) Standardized Regulations (Government Civilians, Foreign
Areas), section 925, ``Maximum Travel Per Diem Allowances for Foreign
Areas,'' prescribed by the Department of State, for travel in areas not
covered in paragraphs (a)(2)(i) and (ii) of this subsection, available
on a subscription basis from the Superintendent of Documents, U.S.
Government Printing Office, Washington, DC 20402, Stock No. 744-008-
00000-0.
(3) In special or unusual situations, actual costs in excess of the
maximum per diem rates are allowable provided that such amounts do not
exceed the higher amounts authorized for Federal civilian employees as
permitted in the regulations referenced in paragraphs (a)(2)(i), (ii),
or (iii) of this subsection. For such higher amounts to be allowable,
all of the following conditions must be met:
(i) One of the conditions warranting approval of the actual expense
method, as set forth in the regulations referred to in paragraphs
(a)(2)(i), (ii), or (iii) of this subsection, must exist.
(ii) A written justification for use of the higher amounts must be
approved by an officer of the contractor's organization or designee to
ensure that the authority is properly administered and controlled to
prevent abuse.
(iii) If it becomes necessary to exercise the authority to use the
higher actual expense method repetitively or on a continuing basis in a
particular area, the contractor must obtain advance approval from the
contracting officer.
(iv) Documentation to support actual costs incurred shall be in
accordance with the contractor's established practices, subject to
paragraph (a)(7) of this subsection, and provided that a receipt is
required for each expenditure of $75.00 or more. The approved
justification required by paragraph (a)(3)(ii) and, if applicable,
paragraph (a)(3)(iii) of this subsection must be retained.
(4) Paragraphs (a)(2) and (a)(3) of this subsection do not
incorporate the regulations cited in paragraphs (a)(2)(i), (ii), and
(iii) of this subsection in their entirety. Only the maximum per diem
rates, the definitions of lodging, meals, and incidental expenses, and
the regulatory coverage dealing with special or unusual situations are
incorporated in this subsection.
(5) An advance agreement (see 48 CFR 31.109 and 48 CFR 970.3101-9)
with respect to compliance with paragraphs (a)(2) and (a)(3) of this
subsection may be useful and desirable.
(6)(i) The maximum per diem rates referenced in paragraph (a)(2) of
this subsection generally would not constitute a reasonable daily
charge--
(A) When no lodging costs are incurred; and/or
(B) On partial travel days (e.g., day of departure and return).
(ii) Appropriate downward adjustments from the maximum per diem
rates would normally be required under these circumstances. While these
adjustments need not be calculated in accordance with the Federal
Travel Regulation or Joint Travel Regulations, they must result in a
reasonable charge.
(7) Costs shall be allowable only if the following information is
documented:
(i) Date and place (city, town, or other similar designation) of
the expenses;
(ii) Purpose of the trip; and
(iii) Name of person on trip and that person's title or
relationship to the contractor.
(b) Travel costs incurred in the normal course of overall
administration of the business are allowable and shall be treated as
indirect costs.
(c) Travel costs directly attributable to specific contract
performance are allowable and may be charged to the contract under 48
CFR 31.202.
(d) Airfare costs in excess of the lowest customary standard,
coach, or equivalent airfare offered during normal business hours are
unallowable except when such accommodations require circuitous routing,
require travel during unreasonable hours, excessively prolong travel,
result in increased cost that would offset transportation savings, are
not reasonably adequate for the physical or medical needs of the
traveler, or are not reasonably available to meet mission requirements.
However, in order for airfare costs in excess of the standard airfare
to be allowable, the applicable condition(s) must be documented and
justified.
(e)(1) ``Cost of travel by contractor-owned, -leased, or -chartered
aircraft,'' as used in this paragraph, includes the cost of lease,
charter, operation (including personnel), maintenance, depreciation,
insurance, and other related costs.
(2) The costs of travel by contractor-owned, -leased, or -chartered
aircraft are limited to the standard airfare described in paragraph (d)
of this subsection for the flight destination unless travel by such
aircraft is specifically required by contract specification, term, or
condition, or a higher amount is approved by the contracting officer. A
higher amount may be agreed to when one or more of the circumstances
for justifying higher than standard airfare listed in paragraph (d) of
this subsection are applicable, or when an advance agreement under
paragraph (e)(3) of this subsection has been executed. In all cases,
travel by contractor-owned, -leased, or -chartered aircraft must be
fully documented and justified. For each contractor-owned, -leased, or
-chartered aircraft used for any business
[[Page 81036]]
purpose which is charged or allocated, directly or indirectly, to a
Government contract, the contractor must maintain and make available
manifest/logs for all flights on such company aircraft. As a minimum,
the manifest/log shall indicate--
(i) Date, time, and points of departure;
(ii) Destination, date, and time of arrival;
(iii) Name of each passenger and relationship to the contractor;
(iv) Authorization for trip; and
(v) Purpose of trip.
(3) Where an advance agreement is proposed (see 31.109),
consideration may be given to the following:
(i) Whether scheduled commercial airlines or other suitable, less
costly, travel facilities are available at reasonable times, with
reasonable frequency, and serve the required destinations conveniently;
(ii) Whether increased flexibility in scheduling results in time
savings and more effective use of personnel that would outweigh
additional travel costs.
(f) Costs of contractor-owned or -leased automobiles, as used in
this paragraph, include the costs of lease, operation (including
personnel), maintenance, depreciation, insurance, etc. These costs are
allowable, if reasonable, to the extent that the automobiles are used
for company business. That portion of the cost of company-furnished
automobiles that relates to personal use by employees (including
transportation to and from work) is compensation for personal services
and is unallowable as stated in 48 CFR 31.205-6(m)(2).
970.3102-05-47 Costs related to legal and other proceedings. (DOE
coverage-paragraph (h)).
(h) Costs Associated with Whistleblower Actions.
Section 931.205-47(h) of this chapter is applicable to management
and operating contracts under this part and must be included in the
contract's cost reimbursement subcontracts.
970.3102-05-53 Preexisting conditions.
Clause 48 CFR 970.5231-4, Preexisting conditions, provides guidance
on situations where this category of costs may be allowable.
970.3170 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5231-
4, Preexisting Conditions, in all management and operating contracts.
(a) The contracting officer shall include the clause with its
Alternate I in contracts with incumbent management and operating
contractors.
(b) The contracting officer shall include the clause with its
Alternate II in contracts with management and operating contractors not
previously working at that particular site or facility.
Subpart 970.32--Contract Financing
970.3200 Policy.
It is the policy of the DOE to finance management and operating
contracts through advance payments and the use of special financial
institution accounts.
970.3200-1 Reduction or suspension of advance, partial, or progress
payments.
(a) The procedures prescribed at 48 CFR 32.006 shall be followed
regarding the reduction or suspension of payments under management and
operating contracts.
(b) Agency head responsibilities under 48 CFR 32.006 have been
delegated to the Senior Procurement Executive.
(c) The remedy coordination official is responsible for receiving,
assessing, and making recommendations to the Senior Procurement
Executive.
970.3200-1-1 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5232-
1, Reduction or suspension of contract payments, in management and
operating contracts.
970.3204 Advance payments.
970.3204-1 Applicability.
(a) The Head of the Contracting Activity shall authorize advance
payments without interest, and approve the findings, determinations and
the contract terms and conditions concerning advance payments in
accordance with the procedures set forth in 48 CFR subpart 32.4,
Advance Payments, as supplemented by 48 CFR subpart 932.4.
(b) Advance payments shall be made under a payments cleared
financing arrangement for deposit in a special financial institution
account or, at the option of the Government, by direct payment or other
payment mechanism to the contractor.
(c) Prior to providing any advance payments, the contracting
officer shall enter into an agreement with the contractor and a
financial institution regarding a special financial institution account
where the advanced funds will be deposited by the Government. Such
agreement shall:
(1) Provide that DOE shall retain title to the unexpended balance
of funds in the special financial institution account including
collections, if any, deposited by the contractor;
(2) Provide that the title in paragraph (c)(1) of this subsection
shall be superior to any claim or lien of the financial institution of
deposit or others; and
(3) Incorporate all applicable requirements, as determined by the
Office of Chief Financial Officer.
(d) Deviations from the requirements cited in paragraph (c) of this
subsection shall be considered a deviation requiring approval of the
Head of the Contracting Activity.
(e) Letter-of-credit arrangements shall be prepared in accordance
with 48 CFR 32.406, Letters of Credit, and shall be coordinated between
the procurement and finance organizations.
970.3270 Standard financial management clauses.
(a) The following DEAR and FAR clauses are standard financial
management clauses. The contracting officer shall insert them in all
management and operating contracts:
(1) 48 CFR 970.5232-2, Payments and Advances.
(i) The contracting officer shall insert the basic clause with its
Alternate I if a separate fixed-fee is provided for a separate item of
work.
(ii) The contracting officer shall insert the basic clause with its
Alternate II when total available fee provisions in the basic clause
are used.
(iii) The contracting officer shall insert the basic clause with
its Alternate III in management and operating contracts with integrated
accounting systems.
(iv) The contracting officer shall insert the basic clause with its
Alternate IV in management and operating contracts without integrated
accounting systems.
(2) 48 CFR 970.5232-3, Accounts, records, and inspection.
(i) If the contract includes the clause at 48 CFR 52.215-11, Price
Reduction for Defective Cost or Pricing Data, the contracting officer
shall use the clause with its Alternate I.
(ii) If the contract is a cost-reimbursement contract involving an
estimated cost exceeding $5 million and expected to run for more than 2
years, or any other cost-reimbursement contract determined by the Head
of the Contracting Activity in which the contractor has an established
internal audit organization, the contracting officer shall insert the
clause with its Alternate II.
(3) 48 CFR 970.5232-4, Obligation of funds. The contracting officer
may use the clause with its Alternate I in contracts which, expressly
or otherwise, provide a contractual basis for equivalent controls in a
separate clause.
(4) 48 CFR 970.5203-1, Management controls.
(5) 48 CFR 970.5232-5, Liability with respect to Cost Accounting
Standards.
[[Page 81037]]
(6) 48 CFR 970.5232-6, Work for others funding authorization.
(7) 48 CFR 52.230-2, Cost Accounting Standards.
(8) 48 CFR 52.230-6, Administration of Cost Accounting Standards.
(b) The following DEAR clauses are standard financial management
clauses. The contracting officer shall insert them in all management
and operating contracts with integrated accounting systems:
(1) 48 CFR 970.5232-7, Financial management system.
(2) 48 CFR 970.5232-8, Integrated accounting.
(c) Any deviations from the standard financial management clauses
specified in paragraphs (a) and (b) of this section require the
approval of the Head of the Contracting Activity and the written
concurrence of the Department's Chief Financial Officer.
Subpart 970.34--Major System Acquisition
970.3400 General requirements.
970.3400-1 Mission-oriented solicitation.
Contractors shall be required to promptly advise the DOE
contracting officer of any advance notices of, or solicitations for,
requirements which would logically involve DOE facilities or resources
operated or managed by the contractor, which are received from another
agency pursuant to 48 CFR 34.005. Management and operating contracts
shall provide that the contractor shall not respond or otherwise
propose to participate in response to the requirements of such
solicitations unless the contractor has obtained the prior written
approval of the DOE manager of the field activity having cognizance
over the contract. Such approval shall not be given except in
compliance with applicable DOE directives, and with the concurrence of
the cognizant Senior Program Official.
970.35 Research and development contracting.
970.3500 Scope of subpart.
This subpart implements 48 CFR 35.017 regarding the establishment,
use, review, and termination of Federally Funded Research and
Development Centers (FFRDCs) sponsored by the Department of Energy.
970.3501 Federally funded research and development centers.
970.3501-1 Sponsoring agreements.
(a) The contract award document constitutes the sponsoring
agreement between the Department of Energy and the contractor operating
an FFRDC.
(b) The contract statement of work shall define the purpose and
mission of the FFRDC.
(c) Other elements of the sponsoring agreement which shall be
incorporated into the contract include:
(1) The appropriate termination clause of the contract (as
prescribed in 48 CFR subpart 49.5).
(2) The plan for the identification, use, and disposition of
retained earnings developed pursuant to 48 CFR 970.1504-1-3(c)(6), if
applicable;
(3) The clause entitled ``Federally Funded Research and Development
Center Sponsoring Agreement,'' which, in part, prescribes limitations
on the FFRDC competing with the private sector, and requirements for
the FFRDC's acceptance of work from a nonsponsor; and
(4) Other terms and conditions considered necessary for the
particular circumstances of the FFRDC (e.g., advance understandings on
particular cost items).
970.3501-2 Using an FFRDC.
The contractor may only accept work from a nonsponsor (as defined
in 48 CFR 35.017) in accordance with the requirements of DOE Order
481.1, Work for Others (Non-Department of Energy Funded Work).
970.3501-3 Reviewing FFRDC's.
(a) All Department of Energy sponsored FFRDC's are operated by
management and operating contractors.
(b) Coincident with the review required by 48 CFR 17.605(b) and 48
CFR 970.1702-1(b) regarding the decision to extend or compete a
management and operating contract, the contracting officer shall, in
accordance with internal Departmental procedures:
(1) Conduct the review required by 48 CFR 35.017-4 concerning the
use and need for the FFRDC; and
(2) Recommend for Secretarial approval, the continuation or
termination of the Department's sponsorship of an FFRDC at the time
authorization is required to extend or compete a management and
operating contract.
970.3501-4 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5235-
1, Federally Funded Research and Development Center Sponsoring
Agreement, in all solicitations and contracts for the management and
operation of an FFRDC sponsored by the Department of Energy.
Subpart 970.36--Construction and Architect-Engineer Contracts
970.3605 Contract clauses.
970.3605-1 Other contracts.
The clause in 48 CFR 52.236-8, Other Contracts, shall be used in
all management and operating contracts.
970.3605-2 Special construction clause for operating contracts.
The clause in 48 CFR 970.5236-1, Government Facility Subcontract
Approval, shall be used in management and operating contracts when the
contractor will not perform covered work with its own forces but may
procure construction by subcontract.
Subpart 970.37--Facilities Management Contracting
970.3770 Facilities management.
970.3770-1 Policy.
Contractors managing DOE facilities shall be required to comply
with the DOE Directives applicable to facilities management.
970.3770-2 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5237-
2, Facilities Management, in all management and operating contracts.
Subpart 970.41--Acquisition of Utility Services
970.4102 Acquiring utility services.
970.4102-1 Policy.
(a) Utility services defined at 48 CFR 41.101 for the furnishing of
electricity, gas (natural or manufactured), steam, water, and/or
sewerage to facilities owned or leased by DOE shall be acquired
directly by DOE and not by a contractor using a subcontractor
arrangement, except as provided in paragraph (b) of this subsection.
(b) Where it is determined to be in the best interest of the
Government, a DOE contracting activity may authorize a management and
operating contractor for a facility to acquire such utility service for
the facility, after requesting and receiving concurrence to make such
an authorization from the Director, Public Utilities Branch,
Headquarters. Any request for such concurrence should be included in
the Utility Service Requirements and Options Studies required by DOE
directives in subseries 4540 (Public Services). Alternatively, it may
be made in a separate document submitted to the Director of that office
early in the acquisition cycle. Any request shall set forth why it is
in the best interest of the
[[Page 81038]]
DOE to acquire utility service(s) by subcontract, i.e., what the
benefits are, such as economic advantage.
(c) The requirements of 48 CFR part 41, this section, and DOE
directives in subseries 4540 shall be applied to a subcontract level
acquisition for furnishing utility services to a facility owned or
leased by DOE.
Subpart 970.42--Contract Administration
970.4207-03-02 Certificate of costs.
(a) The contracting officer shall require that management and
operating contractors provide a submission, pursuant to 48 CFR
970.5232-2-(j), for settlement of costs incurred during the period
stipulated on the submission and a certification that the costs
included in the submission are allowable. The contracting officer shall
assess a penalty pursuant to 48 CFR 970.5242-1 if unallowable costs are
included in the submission. Unallowable costs are either expressly
unallowable or determined unallowable.
(1) An expressly unallowable cost is a particular item or type of
cost which, under the express provisions of an applicable law,
regulation, or this contract, is specifically named and stated to be
unallowable.
(2) A cost determined unallowable is one which, for that
contractor,
(i) Was subject to a contracting officer's final decision and not
appealed;
(ii) The Department's Board of Contract Appeals or a court has
previously ruled as unallowable; or
(iii) was mutually agreed to be unallowable.
(b) If, during the review of the submission, the contracting
officer determines that the submission contains an expressly
unallowable cost or a cost determined to be unallowable prior to the
submission, the contracting officer shall assess a penalty.
(c) If the contracting officer determines that a cost submitted by
the contractor in its submission for settlement is:
(1) Expressly unallowable, then the contracting officer shall
assess a penalty in an amount equal to the disallowed cost allocated to
the contract plus interest on the paid portion of the disallowed cost.
Interest shall be computed from the date of overpayment to the date of
repayment using the interest rate specified by the Secretary of the
Treasury pursuant to Public Law 92-41 (85 Stat. 97).
(2) Determined unallowable, then the contracting officer shall
assess a penalty in an amount equal to two times the amount of the
disallowed cost allocated to the contract.
(d) The contracting officer may waive the penalty provisions when:
(1) The contractor withdraws the submission before the formal
initiation of an audit of the submission and submits a revised
submission;
(2) The amount of the unallowable costs allocated to covered
contracts is $10,000 or less; or
(3) The contractor demonstrates to the contracting officer's
satisfaction that:
(i) It has established appropriate policies, personnel training,
and an internal control and review system that provides assurances that
unallowable costs subject to penalties are precluded from the
contractor's submission for settlement of costs; and
(ii) The unallowable costs subject to the penalty were
inadvertently incorporated into the submission.
(e) The Head of the Contracting Activity may waive the
certification when--
(1) It determines that it would be in the best interest of the
United States to waive such certification; and
(2) It states in writing the reasons for that determination and
makes such determination available to the public.
970.4207-03-70 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5242-
1, Penalties for unallowable costs, in all management and operating
solicitations and contracts.
970.4207-05-01 Contracting officer determination procedure. (DOE
coverage-paragraph (b))
(b)(4) A contracting officer shall not resolve any questioned costs
until the contracting officer has obtained:
(i) Adequate documentation with respect to such costs; and
(ii) The opinion of the Department of Energy's auditor on the
allowability of such costs.
(5) The contracting officer shall ensure that the documentation
supporting the final settlement addresses the amount of the questioned
costs and the subsequent disposition of such questioned costs.
(6) The contracting officer shall ensure, to the maximum extent
practicable, that the Department of Energy's auditor is afforded an
opportunity to attend any negotiation or meeting with the contractor
regarding a determination of allowability.
Subpart 970.43--Contract Modifications
970.4302 Changes.
970.4302-1 Contract clause.
The contracting officer shall insert the clause at 48 CFR 970.5243-
1, Changes, in all management and operating contracts.
Subpart 970.44--Management and Operating Contractor Purchasing
970.4400 Scope.
This subpart prescribes policies and procedures concerning the
purchasing systems and activities of management and operating
contractors.
970.4401 Responsibilities.
970.4401-1 General.
(a) In the Department of Energy, overall responsibility for the
oversight of the performance of management and operating contractors,
including their purchasing activities, rests with the cognizant DOE
contracting activity and, in particular, the Head of the Contracting
Activity (HCA). Contracting officers are responsible for the management
and operating contractors' conformance with this subpart and the
applicable terms and conditions of their contracts, and for determining
whether those purchasing activities provide timely and effective
support to DOE programs.
(b) In carrying out their overall responsibilities, HCAs shall:
(1) Require management and operating contractors to maintain
written descriptions of their individual purchasing systems and methods
and further require that, upon award or extension of the contract, the
entire written description be submitted to the contracting officer for
review and acceptance;
(2) Require that any changes to the management and operating
contractor's written description having any substantive impact upon the
contractor's purchasing system and methods be submitted to the
contracting officer for review and acceptance prior to issuance;
(3) Ensure the review of individual purchasing actions of certain
types, or above stated dollar levels, by the contracting officer
pursuant to 48 CFR subpart 44.2 or as set forth in the contractor's
approved system and methods; and
(4) Ensure that periodic appraisals of the contractor's management
of all facets of the purchasing function, including compliance with the
contractor's approved system and
[[Page 81039]]
methods, are performed by the contracting officer. Such appraisals
shall be performed through either of the following methodologies:
(i) Contractor Purchasing System Reviews, conducted in accordance
with 48 CFR subpart 44.3; or
(ii) When approved by the contracting officer, contractor
participation in the conduct of the Balanced Scorecard performance
measurement and performance management system.
(c) In performing the reviews required by paragraphs (b)(1) and
(2), and the appraisals required by paragraph (b)(4) of this
subsection, HCAs shall assure that contracting officers determine that
the contractors' written systems and methods are consistent with this
subpart and the applicable terms and conditions of their contracts.
970.4401-2 Review and approval.
(a) The Heads of the Contracting Activities shall establish
thresholds, by subcontract type and dollar level, for the review and
approval of proposed subcontracting actions by each management and
operating contractor under their cognizance. Such thresholds may not
exceed the authority delegated to the Head of the Contracting Activity
by the Senior Procurement Executive. In establishing these thresholds,
the Heads of the Contracting Activities should consider such factors as
the following:
(1) The nature of work to be performed under the management and
operating contract;
(2) The size, experience, ability, reliability, and organization of
the management and operating contractor's purchasing function;
(3) The internal controls, procedures, and organizational stature
of the management and operating contractor's purchasing function; and
(4) Policies with respect to such reviews and approvals established
by the Senior Procurement Executive.
(b) Prior approval shall be required for the subcontracting of any
work a contractor is obligated to perform under a contract entered into
under section 41, entitled Production of Special Nuclear Material, of
the Atomic Energy Act of 1954, as amended.
(c) The Heads of the Contracting Activities shall take such action
as may be required to insure compliance with the procedure for
purchasing from contractor-affiliated sources or the purchase of
specific items, or classes of items, which by the terms of the contract
may require DOE approval.
(d) The Heads of the Contracting Activities may raise or lower the
review and approval thresholds established pursuant to paragraph (a) of
this subsection at any time. Such action may be considered upon the
periodic review of the contractor's purchasing system, but in any case
those adjusted thresholds may not exceed the approval authority
delegated to the Head of the Contracting Activity by the Senior
Procurement Executive.
(e) DOE approvals of specific proposed purchases pursuant to this
subpart shall communicate that such approval does not relieve the
management and operating contractor of any obligation under its prime
contract with DOE; is given without prejudice to any rights or claims
of the Government thereunder; creates no obligation on the part of the
Government to the subcontractor, and is not a predetermination of the
allowability of costs to be incurred under the subcontract.
(f) Contracting officers shall assure that management and operating
contractors establish and maintain subcontract files which contain
those documents essential to present an accurate and adequate record of
all purchasing transactions.
(g) Contracting officers shall assure that management and operating
contractors document purchases in writing, setting forth the
information and data used in determining that the purchases are in the
best interest of the Government. The scope and detail of this
documentation shall be consistent with the nature, dollar value, and
complexity of the purchase.
(h) The Heads of the Contracting Activities shall assure that the
contracting activity establishes and maintains files of the documents
associated with the review and approval of subcontract actions subject
to DOE review and approval. Those files shall include, among other
necessary documentation, an appraisal of the proposed action by the
contracting activity and a copy of the approving or disapproving
document forwarded to the management and operating contractor,
including a listing of any deficiencies, a listing of any required
corrective actions, any suggestions, or other relevant comments.
970.4401-3 Advance notification.
(a) Contracting officers shall assure that the written description
of the management and operating contractor's purchasing system and
methods provides for advance notice to the DOE contracting officer of
the proposed award of the following specified types of subcontracts,
except as stated in paragraph (b) of this subsection:
(1) Pursuant to section 304(b) of the Federal Property and
Administrative Service Act of 1949, as amended (41 U.S.C. 254(b)):
(i) Cost reimbursement-type subcontracts of any award value; and
(ii) Fixed price-type subcontracts which exceed the simplified
acquisition threshold, or 5 percent of the total estimated cost of the
prime contract.
(2) Purchases from contractor-affiliated sources over a value
established by the HCA.
(b) Pursuant to section 602(d)13 of the Act (40 U.S.C. 474(13))
referred to in paragraph (a) of this section, the advance notification
requirement for the types of purchases listed in paragraphs (a) (1) and
(2) of this subsection shall not apply to subcontracts relating to
functions derived from the Atomic Energy Commission.
(c) The advance notice shall contain, at a minimum, a description
of work, estimated cost, type of contract or reimbursement provisions,
and extent of competition, or justification for a noncompetitive
purchase procurement. The contracting officer may at any time request
additional information that must be furnished promptly and prior to
award of the subcontract.
970.4402 Contractor purchasing system.
970.4402-1 Policy.
(a) DOE contracts for the management and operation of its
facilities, the design and production of nuclear weapons, energy
research and development, and the performance of other services. These
management and operating (M&O) contractors have been selected for their
technical and managerial expertise and are expected to bring to bear
these technical and managerial skills to accomplish the significant
Federal mission(s) described in their contracts with, and work plans
approved by, DOE.
(b) Purchasing done by management and operating contractors is one
area in which the particular skills of the contractors will be brought
to bear in order to more readily accomplish the contractors' assigned
missions. The contracting procedures of the contractor's organization,
therefore, form the basis for the development of a purchasing system
and methods that will comply with its contract with DOE and this
subpart.
970.4402-2 General requirements.
The following shall apply to the purchasing systems of management
and operating contractors:
(a) The objective of a management and operating contractor's
purchasing system is to deliver to its customers on a timely basis
those best value products
[[Page 81040]]
and services necessary to accomplish the purposes of the Government's
contract. To achieve this objective, contractors are expected to use
their experience, expertise and initiative consistent with this
subpart.
(b) The purchasing systems and methods used by management and
operating contractors shall be well-defined, consistently applied, and
shall follow purchasing practices appropriate for the requirement and
dollar value of the purchase. It is anticipated that purchasing
practices and procedures will vary among contractors and according to
the type and kinds of purchases to be made.
(c) Contractor purchases are not Federal procurements, and are not
directly subject to the Federal Acquisition Regulations in 48 CFR.
Nonetheless, certain Federal laws, Executive Orders, and regulations
may affect contractor purchasing, as required by statute, regulation,
or contract terms and conditions.
(d) Contractor purchasing systems shall identify and apply the best
in commercial purchasing practices and procedures (although nothing
precludes the adoption of Federal procurement practices and procedures)
to achieve system objectives. Where specific requirements do not
otherwise apply, the contractor purchasing system shall provide for
appropriate measures to ensure the:
(1) Acquisition of quality products and services at fair and
reasonable prices;
(2) Use of capable and reliable subcontractors who either:
(i) Have track records of successful past performance, or
(ii) Can demonstrate a current superior ability to perform;
(3) Minimization of acquisition lead-time and administrative costs
of purchasing;
(4) Use of effective competitive techniques;
(5) Reduction of performance risks associated with subcontractors,
and facilitation of quality relationships which can include techniques
such as partnering agreements, ombudsmen, and alternative disputes
procedures;
(6) Use of self-assessment and benchmarking techniques to support
continuous improvement in purchasing;
(7) Maintenance of the highest professional and ethical standards;
(8) Maintenance of file documentation appropriate to the value of
the purchase and which is adequate to establish the propriety of the
transaction and the price paid; and
(9) Maximization of opportunities for small business, HUBZone small
business, small disadvantaged business, and woman-owned small business
concerns to participate in contract performance.
970.4402-3 Purchasing from contractor-affiliated sources.
(a) A management and operating contractor may purchase from sources
affiliated with the contractor (any division, subsidiary, or affiliate
of the contractor or its parent company) in the same manner as from
other sources, provided:
(1) The management and operating contractor's purchasing function
is independent of the proposed contractor-affiliated source;
(2) The same terms and conditions would apply if the purchase were
from a third party;
(3) Award is made in accordance with policies and procedures
designed to permit effective competition which have been approved by
the contracting officer. (This requirement for competition shall not
preclude acquisition of technical services from contractor-affiliated
entities where those entities have a special expertise, and the basis
therefor is documented.); and
(4) The award is legally enforceable where the entities are
separately incorporated.
(b) Subcontracts for performance of contract work itself (as
distinguished from the purchase of supplies and services needed in
connection with the performance of work) require DOE authorization and
may involve an adjustment of the contractor's fee, if any. If the
management and operating contractor seeks authorization to have some
part of the contract work performed by a contractor-affiliated source,
and that contractor's performance of that work was a factor in the
negotiated fee, DOE approval would normally require:
(1) That the contractor-affiliated source perform such work without
fee or profit, or
(2) An equitable downward adjustment to the management and
operating contractor's fee, if any.
(c) Determination on cost of money allowance as prescribed at 48
CFR 31.205-10 shall be treated as follows:
(1) When a purchase from a contractor-affiliated source results
from competition and is in accord with provisions and conditions of
paragraphs (a)(1) through (a)(4) of this subsection, the contractor-
affiliated source may include cost of money as an allowable element of
the costs of its goods or services supplied to the contractor;
provided:
(i) The purchase is based on cost as set forth in 48 CFR 970.3102-
3-21 and
(ii) The cost of money amount is computed in accordance with 48 CFR
31.205-10 and related procedures (see 48 CFR 970.30).
(2) When a purchase from a contractor-affiliated source is made
non-competitively, cost of money shall not be considered an allowable
element of the cost of the contractor-affiliated source purchase.
970.4402-4 Nuclear material transfers.
(a) Management and operating contractors, in preparing subcontracts
or other agreements in which monetary payments or credits depend on the
quantity and quality of nuclear material, shall be required to assure
that each such subcontract or agreement contains a:
(1) Description of the material to be transferred;
(2) Provision specifying the method by which the quantities are to
be measured and reported;
(3) Provision specifying the procedures to be used in resolving any
differences arising as a result of such measurements;
(4) Provision for the use of an independent third party as an
umpire to settle unresolved differences in the analytical samples; and
(5) Provision specifying in detail which party shall bear the costs
of resolving a difference and what constitutes such costs.
(b) The provisions providing for resolution of measurement
differences must be such that resolution is always accomplished, while
at the same time minimizing any advantage one party may have over the
other.
970.4403 Contract clause.
The contracting officer shall insert the clause at 970.5244-1,
Contractor Purchasing System, in all management and operating
contracts.
Subpart 970.45--Government Property
970.4501 General.
970.4501-1 Contract clause.
(a) The contracting officer shall insert the clause at 970.5245-1,
Property, in management and operating contracts. Paragraph (f)(1)(i)(c)
of the clause applies to a non-profit contractor only to the extent
specifically provided in the individual contract. Specific managerial
personnel may be listed in paragraph (j), provided their listing is
consistent with the clause and the DEAR.
(b) The contracting officer shall insert the basic clause with its
Alternate I in contracts with nonprofit contractors.
[[Page 81041]]
Subpart 970.49--Termination of Contracts
970.4905 Contract termination clause.
970.4905-1 Termination for convenience of the government and default.
(a) The contracting officer shall include the clause at 48 CFR
52.249-6, Termination (Cost Reimbursement), as modified pursuant to
paragraph (b) of this subsection, in all cost-reimbursement management
and operating contracts, regardless of whether the contract is for
production, or research and development with an educational or
nonprofit institution.
(b) The contracting officer shall modify paragraph (i) of the
clause to insert ``as supplemented in subpart 970.31 of the Department
of Energy Acquisition Regulation,'' after the phrase, ``part 31 of the
Federal Acquisition Regulation.''
Subpart 970.50--Extraordinary Contractual Actions
970.5004 Residual powers.
970.5004-1 Contract clause.
When use of the clause at 48 CFR 52.250-1, Indemnification Under
Public Law 85-804, is appropriate, the contracting officer may
substitute the words ``Obligation of funds'' for the words ``Limitation
of Cost or Limitation of Funds.''
970.5070 Indemnification.
970.5070-1 Scope and applicability.
(a) Section 170d. of the Atomic Energy Act of 1954, as amended,
requires DOE to enter into agreements of indemnity with contractors
whose work involves the risk of public liability for the occurrence of
a nuclear incident or precautionary evacuation.
(b) Details of such indemnification are discussed at 48 CFR 950.70.
970.5070-2 General.
DOE contractors with whom statutory nuclear hazards indemnity
agreements under the authority of section 170d. of the Atomic Energy
Act of 1954, as amended, are executed will not normally be required or
permitted to furnish financial protection by purchase of insurance to
cover public liability for nuclear incidents. However, if authorized by
the DOE Headquarters office having responsibility for contractor
casualty insurance programs, DOE contractors may be
(a) Permitted to furnish financial protection to themselves, or
(b) Permitted to continue to carry such insurance at cost to the
Government if they currently maintain insurance for such liability.
970.5070-3 Contract clauses.
(a) The clause at 48 CFR 952.250-70, Nuclear Hazards Indemnity
Agreement, shall be included in all management and operating contracts
involving the risk of public liability for the occurrence of a nuclear
incident or precautionary evacuation arising out of or in connection
with the contract work, including such events caused by a product
delivered to a DOE-owned, facility for use by DOE or its contractors.
The clause at 48 CFR 952.250-70 also shall be included in any
management and operating contract for the design of a DOE facility, the
construction or operation of which may involve the risk of public
liability for a nuclear incident or a precautionary evacuation.
(b) The clause at 48 CFR 952.250-70 shall not be included in
contracts in which the contractor is subject to Nuclear Regulatory
Commission (NRC) financial protection requirements under section 170b.
of the Act or NRC agreements of indemnification under section 170 c. or
k. of the Act for activities to be performed under the contract.
Subpart 970.52--Solicitation Provisions and Contract Clauses for
Management and Operating Contracts
970.5200 Scope of subpart.
This subpart prescribes some of the solicitation provisions and
contract clauses for use in management and operating contracts. The
provisions and clauses contained in this subpart supplement the
provisions and clauses prescribed in the FAR and in other parts of the
DEAR (48 CFR 901 through 48 CFR 952), and, pursuant to the individual
provision or clause prescription, are to be used in addition to or in
place of such clauses. Management and operating contracts are hybrid
contracts, in some cases including aspects of several FAR contract
types, for example, supplies and construction. For some FAR
solicitation provisions and contract clauses, this subpart prescribes
their use despite the hybrid nature of the work required. To assist
Departmental contracting personnel in determining the applicability of
FAR and DEAR clauses to management and operating contracts, additional
guidance is published and made available by the Office of Procurement
and Assistance Policy, within the Headquarters procurement
organization.
970.5201 Text of provisions and clauses.
970.5203-1 Management controls.
As prescribed in 48 CFR 970.0370-2(a) and 48 CFR 970.3270(a)(4),
insert the following clause:
Management Controls (DEC 2000)
(a)(1) The contractor shall be responsible for maintaining, as
an integral part of its organization, effective systems of
management controls for both administrative and programmatic
functions. Management controls comprise the plan of organization,
methods, and procedures adopted by management to reasonably ensure
that: the mission and functions assigned to the contractor are
properly executed; efficient and effective operations are promoted;
resources are safeguarded against waste, loss, mismanagement,
unauthorized use, or misappropriation; all encumbrances and costs
that are incurred under the contract and fees that are earned are in
compliance with applicable clauses and other current terms,
conditions, and intended purposes; all collections accruing to the
contractor in connection with the work under this contract,
expenditures, and all other transactions and assets are properly
recorded, managed, and reported; and financial, statistical, and
other reports necessary to maintain accountability and managerial
control are accurate, reliable, and timely.
(2) The systems of controls employed by the contractor shall be
documented and satisfactory to DOE.
(3) Such systems shall be an integral part of the contractor's
management functions, including defining specific roles and
responsibilities for each level of management, and holding employees
accountable for the adequacy of the management systems and controls
in their areas of assigned responsibility.
(4) The contractor shall, as part of the internal audit program
required elsewhere in this contract, periodically review the
management systems and controls employed in programs and
administrative areas to ensure that they are adequate to provide
reasonable assurance that the objectives of the systems are being
accomplished and that these systems and controls are working
effectively.
(b) The contractor shall be responsible for maintaining, as a
part of its operational responsibilities, a baseline quality
assurance program that implements documented performance, quality
standards, and control and assessment techniques.
(End of Clause)
970.5203-2 Performance improvement and collaboration.
As prescribed in 48 CFR 970.0370-2(b), insert the following clause:
Performance Improvement and Collaboration (DEC 2000)
(a) The contractor agrees that it shall affirmatively identify,
evaluate, and institute practices, where appropriate, that will
improve performance in the areas of environmental and health,
safety, scientific and technical, security, business and
[[Page 81042]]
administrative, and any other areas of performance in the management
and operation of the contract. This may entail the alteration of
existing practices or the institution of new procedures to more
effectively or efficiently perform any aspect of contract
performance or reduce overall cost of operation under the contract.
Such improvements may result from changes in organization,
simplification of systems while retaining necessary controls, or any
other approaches consistent with the statement of work and
performance measures of this contract.
(b) The contractor agrees to work collaboratively with the
Department, all other management and operating, DOE major facilities
management contractors and affiliated contractors which manage or
operate DOE sites or facilities for the following purposes: (i) to
exchange information generally, (ii) to evaluate concepts that may
be of benefit in resolving common issues, in confronting common
problems, or in reducing costs of operations, and (iii) to otherwise
identify and implement DOE-complex-wide management improvements
discussed in paragraph (a). In doing so, it shall also affirmatively
provide information relating to its management improvements to such
contractors, including lessons learned, subject to security
considerations and the protection of data proprietary to third
parties.
(c) The contractor may consult with the contracting officer in
those instances in which improvements being considered pursuant to
paragraph (a) involve the cooperation of the DOE. The contractor may
request the assistance of the contracting officer in the
communication of the success of improvements to other management and
operating contractors in accordance with paragraph (b) of this
clause.
(d) The contractor shall notify the contracting officer and seek
approval where necessary to fulfill its obligations under the
contract. Compliance with this clause in no way alters the
obligations of the Contractor under any other provision of this
contract.
(End of Clause)
970.5203-3 Contractor's organization.
As prescribed in 48 CFR 970.0371-9, insert the following clause:
Contractor's Organization (DEC 2000)
(a) Organization chart. As promptly as possible after the
execution of this contract, the contractor shall furnish to the
contracting officer a chart showing the names, duties, and
organization of key personnel (see 48 CFR 952.215-70) to be employed
in connection with the work, and shall furnish supplemental
information to reflect any changes as they occur.
(b) Supervisory representative of contractor. Unless otherwise
directed by the contracting officer, a competent full-time resident
supervisory representative of the contractor satisfactory to the
contracting officer shall be in charge of the work at the site, and
any work off-site, at all times.
(c) Control of employees. The contractor shall be responsible
for maintaining satisfactory standards of employee competency,
conduct, and integrity and shall be responsible for taking such
disciplinary action with respect to its employees as may be
necessary. In the event the contractor fails to remove any employee
from the contract work whom DOE deems incompetent, careless, or
insubordinate, or whose continued employment on the work is deemed
by DOE to be inimical to the Department's mission, the contracting
officer may require, with the approval of the Secretary of Energy,
the contractor to remove the employee from work under the contract.
This includes the right to direct the contractor to remove its most
senior key person from work under the contract for serious contract
performance deficiencies.
(d) Standards and procedures. The contractor shall establish
such standards and procedures as are necessary to implement the
requirements set forth in 48 CFR 970.0371. Such standards and
procedures shall be subject to the approval of the contracting
officer.
(End of Clause)
970.5204-1 Counterintelligence.
(a) As prescribed in 48 CFR 970.0404-4(a), insert the following
clause in contracts containing the clauses at 48 CFR 952.204-2,
Security, and 48 CFR 952.204-70, Classification/Declassification:
Counterintelligence (DEC 2000)
(a) The contractor shall take all reasonable precautions in the
work under this contract to protect DOE programs, facilities,
technology, personnel, unclassified sensitive information and
classified matter from foreign intelligence threats and activities
conducted for governmental or industrial purposes, in accordance
with DOE Order 5670.3, Counterintelligence Program; Executive Order
12333, U.S. Intelligence Activities; and other pertinent national
and Departmental Counterintelligence requirements.
(b) The contractor shall appoint a qualified employee(s) to
function as the Contractor Counterintelligence Officer. The
Contractor Counterintelligence Officer will be responsible for
conducting defensive Counterintelligence briefings and debriefings
of employees traveling to foreign countries or interacting with
foreign nationals; providing thoroughly documented written reports
relative to targeting, suspicious activity and other matters of
Counterintelligence interest; immediately reporting targeting,
suspicious activity and other Counterintelligence concerns to the
DOE Headquarters Counterintelligence Division; and providing
assistance to other elements of the U.S. Intelligence Community as
stated in the aforementioned Executive Order, the DOE
Counterintelligence Order, and other pertinent national and
Departmental Counterintelligence requirements.
(End of Clause)
970.5204-2 Laws, regulations, and DOE directives.
As prescribed in 48 CFR 970.0470-2, insert the following clause:
Laws, Regulations, and DOE Directives (DEC 2000)
(a) In performing work under this contract, the contractor shall
comply with the requirements of applicable Federal, State, and local
laws and regulations (including DOE regulations), unless relief has
been granted in writing by the appropriate regulatory agency. A List
of Applicable Laws and regulations (List A) may be appended to this
contract for information purposes. Omission of any applicable law or
regulation from List A does not affect the obligation of the
contractor to comply with such law or regulation pursuant to this
paragraph.
(b) In performing work under this contract, the contractor shall
comply with the requirements of those Department of Energy
directives, or parts thereof, identified in the List of Applicable
Directives (List B) appended to this contract. Except as otherwise
provided for in paragraph (d) of this clause, the contracting
officer may, from time to time and at any time, revise List B by
unilateral modification to the contract to add, modify, or delete
specific requirements. Prior to revising List B, the contracting
officer shall notify the contractor in writing of the Department's
intent to revise List B and provide the contractor with the
opportunity to assess the effect of the contractor's compliance with
the revised list on contract cost and funding, technical
performance, and schedule; and identify any potential
inconsistencies between the revised list and the other terms and
conditions of the contract. Within 30 days after receipt of the
contracting officer's notice, the contractor shall advise the
contracting officer in writing of the potential impact of the
contractor's compliance with the revised list. Based on the
information provided by the contractor and any other information
available, the contracting officer shall decide whether to revise
List B and so advise the contractor not later than 30 days prior to
the effective date of the revision of List B. The contractor and the
contracting officer shall identify and, if appropriate, agree to any
changes to other contract terms and conditions, including cost and
schedule, associated with the revision of List B pursuant to the
clause of this contract entitled, ``Changes.''
(c) Environmental, safety, and health (ES&H) requirements
appropriate for work conducted under this contract may be determined
by a DOE approved process to evaluate the work and the associated
hazards and identify an appropriately tailored set of standards,
practices, and controls, such as a tailoring process included in a
DOE approved Safety Management System implemented under the clause
entitled ``Integration of Environment, Safety, and Health into Work
Planning and Execution.'' When such a process is used, the set of
tailored (ES&H) requirements, as approved by DOE pursuant to the
process, shall be incorporated into List B as contract requirements
with full force and effect. These requirements shall supersede, in
whole or in part, the contractual environmental, safety, and health
requirements previously made applicable to the contract by List B.
If the tailored set of requirements identifies an alternative
requirement varying from an ES&H
[[Page 81043]]
requirement of an applicable law or regulation, the contractor shall
request an exemption or other appropriate regulatory relief
specified in the regulation.
(d) Except as otherwise directed by the contracting officer, the
contractor shall procure all necessary permits or licenses required
for the performance of work under this contract.
(e) Regardless of the performer of the work, the contractor is
responsible for compliance with the requirements of this clause. The
contractor is responsible for flowing down the requirements of this
clause to subcontracts at any tier to the extent necessary to ensure
the contractor's compliance with the requirements.
(End of Clause)
970.5204-3 Access to and ownership of records.
As prescribed in 48 CFR 970.0407-1-3, insert the following clause:
Access to and Ownership of Records (DEC 2000)
(a) Government-owned records. Except as provided in paragraph
(b) of this clause, all records acquired or generated by the
contractor in its performance of this contract shall be the property
of the Government and shall be delivered to the Government or
otherwise disposed of by the contractor either as the contracting
officer may from time to time direct during the progress of the work
or, in any event, as the contracting officer shall direct upon
completion or termination of the contract.
(b) Contractor-owned records. The following records are
considered the property of the contractor and are not within the
scope of paragraph (a) of this clause. [The contracting officer
shall identify which of the following categories of records will be
included in the clause.]
(1) Employment-related records (such as workers' compensation
files; employee relations records, records on salary and employee
benefits; drug testing records, labor negotiation records; records
on ethics, employee concerns, and other employee related
investigations conducted under an expectation of confidentiality;
employee assistance program records; and personnel and medical/
health-related records and similar files), and non-employee patient
medical/health related records, except for those records described
by the contract as being maintained in Privacy Act systems of
records.
(2) Confidential contractor financial information, and
correspondence between the contractor and other segments of the
contractor located away from the DOE facility (i.e., the
contractor's corporate headquarters);
(3) Records relating to any procurement action by the
contractor, except for records that under 48 CFR 970.5232-3,
Accounts, Records, and Inspection, are described as the property of
the Government; and
(4) Legal records, including legal opinions, litigation files,
and documents covered by the attorney-client and attorney work
product privileges; and
(5) The following categories of records maintained pursuant to
the technology transfer clause of this contract:
(i) Executed license agreements, including exhibits or
appendices containing information on royalties, royalty rates, other
financial information, or commercialization plans, and all related
documents, notes and correspondence.
(ii) The contractor's protected Cooperative Research and
Development Agreement (CRADA) information and appendices to a CRADA
that contain licensing terms and conditions, or royalty or royalty
rate information.
(iii) Patent, copyright, mask work, and trademark application
files and related contractor invention disclosures, documents and
correspondence, where the contractor has elected rights or has
permission to assert rights and has not relinquished such rights or
turned such rights over to the Government.
(c) Contract completion or termination. In the event of
completion or termination of this contract, copies of any of the
contractor-owned records identified in paragraph (b) of this clause,
upon the request of the Government, shall be delivered to DOE or its
designees, including successor contractors. Upon delivery, title to
such records shall vest in DOE or its designees, and such records
shall be protected in accordance with applicable federal laws
(including the Privacy Act), as appropriate.
(d) Inspection, copying, and audit of records. All records
acquired or generated by the contractor under this contract in the
possession of the contractor, including those described at paragraph
(b) of this clause, shall be subject to inspection, copying, and
audit by the Government or its designees at all reasonable times,
and the contractor shall afford the Government or its designees
reasonable facilities for such inspection, copying, and audit;
provided, however, that upon request by the contracting officer, the
contractor shall deliver such records to a location specified by the
contracting officer for inspection, copying, and audit. The
Government or its designees shall use such records in accordance
with applicable federal laws (including the Privacy Act), as
appropriate.
(e) Applicability. Paragraphs (b), (c), and (d) of this clause
apply to all records without regard to the date or origination of
such records.
(f) Records retention standards. Special records retention
standards, described at DOE Order 200.1, Information Management
Program (version in effect on effective date of contract), are
applicable for the classes of records described therein, whether or
not the records are owned by the Government or the contractor. In
addition, the contractor shall retain individual radiation exposure
records generated in the performance of work under this contract
until DOE authorizes disposal. The Government may waive application
of these record retention schedules, if, upon termination or
completion of the contract, the Government exercises its right under
paragraph (c) of this clause to obtain copies and delivery of
records described in paragraphs (a) and (b) of this clause.
(g) Subcontracts. The contractor shall include the requirements
of this clause in all subcontracts that are of a cost-reimbursement
type if any of the following factors is present:
(1) The value of the subcontract is greater than $2 million
(unless specifically waived by the contracting officer);
(2) The contracting officer determines that the subcontract is,
or involves, a critical task related to the contract; or
(3) The subcontract includes 48 CFR 970.5223-1, Integration of
Environment, Safety, and Health into Work Planning and Execution, or
similar clause.
(End of Clause)
970.5208-1 Printing.
As prescribed in 48 CFR 970.0808-3, insert the following clause:
Printing (DEC 2000)
(a) To the extent that duplicating or printing services may be
required in the performance of this contract, the Contractor shall
provide or secure such services in accordance with the Government
Printing and Binding Regulations, Title 44 of the U.S. Code, and DOE
Directives relative thereto.
(b) The term ``Printing'' includes the following processes:
Composition, platemaking, presswork, binding, microform publishing,
or the end items produced by such processes. Provided, however, that
performance of a requirement under this contract involving the
duplication of less than 5,000 copies of a single page, or no more
than 25,000 units in the aggregate of multiple pages, will not be
deemed to be printing.
(c) Printing services not obtained in compliance with this
guidance shall result in the cost of such printing being disallowed.
(d) The Contractor shall include the substance of this clause in
all subcontracts hereunder which require printing (as that term is
defined in Title I of the U.S. Government Printing and Binding
Regulations).
(End of Clause)
970.5209-1 Requirement for guarantee of performance.
As prescribed in 48 CFR 970.0970-2, the contracting officer shall
insert the following provision in solicitations for management and
operating contracts:
Requirement for Guarantee of Performance (DEC 2000)
The successful offeror is required by other provisions of this
solicitation to organize a dedicated corporate entity to carry out
the work under the contract to be awarded as a result of this
solicitation. The successful offeror will be required, as part of
the determination of responsibility of the newly organized,
dedicated corporate entity and as a condition of the award of the
contract to that entity, to furnish a guarantee of that entity's
performance. That guarantee of performance must be satisfactory in
all respects to the Department of Energy.
(End of Clause)
970.5215-1 Total available fee: Base fee amount and performance fee
amount.
As prescribed in 48 CFR 970.1504-5(a), insert the following clause.
The clause should be tailored to reflect the
[[Page 81044]]
contract's actual inclusion of base fee amount and performance fee
amount.
Total Available Fee: Base Fee Amount and Performance Fee Amount (DEC
2000)
(a) Total available fee. Total available fee, consisting of a
base fee amount ( which may be zero) and a performance fee amount
(consisting of an incentive fee component for objective performance
requirements, an award fee component for subjective performance
requirements, or both) determined in accordance with the provisions
of this clause, is available for payment in accordance with the
clause of this contract entitled, ``Payments and advances.''
(b) Fee Negotiations. Prior to the beginning of each fiscal year
under this contract, or other appropriate period as mutually agreed
upon and, if exceeding one year, approved by the Senior Procurement
Executive, or designee, the contracting officer and Contractor shall
enter into negotiation of the requirements for the year or
appropriate period, including the evaluation areas and individual
requirements subject to incentives, the total available fee, and the
allocation of fee. The contracting officer shall modify this
contract at the conclusion of each negotiation to reflect the
negotiated requirements, evaluation areas and individual
requirements subject to incentives, the total available fee, and the
allocation of fee. In the event the parties fail to agree on the
requirements, the evaluation areas and individual requirements
subject to incentives, the total available fee, or the allocation of
fee, a unilateral determination will be made by the contracting
officer. The total available fee amount shall be allocated to a
twelve month cycle composed of one or more evaluation periods, or
such longer period as may be mutually agreed to between the parties
and approved by the Senior Procurement Executive, or designee.
(c) Determination of Total Available Fee Amount Earned. (1) The
Government shall, at the conclusion of each specified evaluation
period, evaluate the contractor's performance of all requirements,
including performance based incentives completed during the period,
and determine the total available fee amount earned. At the
contracting officer's discretion, evaluation of incentivized
performance may occur at the scheduled completion of specific
incentivized requirements.
(2) The DOE Operations/Field Office Manager, or designee, will
be (insert title of DOE Operations/Field Office Manager, or
designee). The contractor agrees that the determination as to the
total available fee earned is a unilateral determination made by the
DOE Operations/Field Office Manager, or designee.
(3) The evaluation of contractor performance shall be in
accordance with the Performance Evaluation and Measurement Plan(s)
described in subparagraph (d) of this clause unless otherwise set
forth in the contract. The Contractor shall be promptly advised in
writing of the fee determination, and the basis of the fee
determination. In the event that the contractor's performance is
considered to be less than the level of performance set forth in the
Statement of Work, as amended to include the current Work
Authorization Directive or similar document, for any contract
requirement, it will be considered by the DOE Operations/Field
Office Manager, or designee, who may at his/her discretion adjust
the fee determination to reflect such performance. Any such
adjustment shall be in accordance with the clause entitled,
``Conditional Payment of Fee, Profit, or Incentives'' if contained
in the contract.
(d) Performance Evaluation and Measurement Plan(s). To the
extent not set forth elsewhere in the contract:
(1) The Government shall establish a Performance Evaluation and
Measurement Plan(s) upon which the determination of the total
available fee amount earned shall be based. The Performance
Evaluation and Measurement Plan(s) will address all of the
requirements of contract performance specified in the contract
directly or by reference. A copy of the Performance Evaluation and
Measurement Plan(s) shall be provided to the Contractor:
(i) prior to the start of an evaluation period if the
requirements, evaluation areas, specific incentives, amount of fee,
and allocation of fee to such evaluation areas and specific
incentives have been mutually agreed to by the parties; or
(ii) not later than thirty days prior to the scheduled start
date of the evaluation period, if the requirements, evaluation
areas, specific incentives, amount of fee, and allocation of fee to
such evaluation areas and specific incentives have been unilaterally
established by the contracting officer.
(2) The Performance Evaluation and Measurement Plan(s) will set
forth the criteria upon which the Contractor will be evaluated
relating to any technical, schedule, management, and/or cost
objectives selected for evaluation. Such criteria should be
objective, but may also include subjective criteria. The Plan(s)
shall also set forth the method by which the total available fee
amount will be allocated and the amount earned determined.
(3) The Performance Evaluation and Measurement Plan(s) may,
consistent with the contract statement of work, be revised during
the period of performance. The contracting officer shall notify the
contractor:
(i) of such unilateral changes at least ninety calendar days
prior to the end of the affected evaluation period and at least
thirty calendar days prior to the effective date of the change;
(ii) of such bilateral changes at least sixty calendar days
prior to the end of the affected evaluation period; or
(iii) if such change, whether unilateral or bilateral, is urgent
and high priority, at least thirty calendar days prior to the end of
the evaluation period.
(e) Schedule for total available fee amount earned
determinations. The DOE Operations/Field Office Manager, or
designee, shall issue the final total available fee amount earned
determination in accordance with: the schedule set forth in the
Performance Evaluation and Measurement Plan(s); or as otherwise set
forth in this contract . However, a determination must be made
within sixty calendar days after the receipt by the contracting
officer of the Contractor's self-assessment, if one is required or
permitted by paragraph (f) of this clause, or seventy calendar days
after the end of the evaluation period, whichever is later, or a
longer period if the Contractor and contracting officer agree. If
the contracting officer evaluates the Contractor's performance of
specific requirements on their completion, the payment of any earned
fee amount must be made within seventy calendar days (or such other
time period as mutually agreed to between the contracting officer
and the Contractor) after such completion. If the determination is
delayed beyond that date, the Contractor shall be entitled to
interest on the determined total available fee amount earned 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 payment date. This rate is referred to as the
``Renegotiation Board Interest Rate,'' and is published in the
Federal Register semiannually on or about January 1 and July 1. The
interest on any late total available fee amount earned determination
will accrue daily and be compounded in 30-day increments inclusive
from the first day after the schedule determination date through the
actual date the determination is issued. That is, interest accrued
at the end of any 30-day period will be added to the determined
amount of fee earned and be subject to interest if not paid in the
succeeding 30-day period.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.1504-
5(a)(1), when the award fee cycle consists of two or more evaluation
periods, add the following to paragraph (c):
(4) At the sole discretion of the Government, unearned total
available fee amounts may be carried over from one evaluation period
to the next, so long as the periods are within the same award fee
cycle.
Alternate II (DEC 2000). As prescribed in 48 CFR 970.1504-
5(a)(2), when the award fee cycle consists of one evaluation period,
add the following to paragraph (c):
(4) Award fee not earned during the evaluation period shall not
be allocated to future evaluation periods.
Alternate III (DEC 2000). As prescribed in 48 CFR 970.1504-
5(a)(3), when the DOE Operations/Field Office Manager, or designee,
requires the contractor to submit a self-assessment, add the
following as paragraph (f):
(f) Contractor self-assessment. Following each evaluation
period, the Contractor shall submit a self-assessment within (Insert
Number) calendar days after the end of the period. This self-
assessment shall address both the strengths and weaknesses of the
Contractor's performance during the evaluation period. Where
deficiencies in performance are noted, the Contractor
[[Page 81045]]
shall describe the actions planned or taken to correct such
deficiencies and avoid their recurrence. The DOE Operations/Field
Office Manager, or designee, will review the Contractor's self-
assessment, if submitted, as part of its independent evaluation of
the contractor's management during the period. A self-assessment, in
and of itself may not be the only basis for the award fee
determination.
Alternate IV (DEC 2000). As prescribed in 48 CFR 970.1504-
5(a)(4), when the DOE Operations/Field Office Manager, or designee,
permits the contractor to submit a self-assessment at the
contractor's option, add the following text as paragraph (f):
(f) Contractor self-assessment. Following each evaluation
period, the Contractor may submit a self-assessment, provided such
assessment is submitted within (Insert Number) calendar days after
the end of the period. This self-assessment shall address both the
strengths and weaknesses of the Contractor's performance during the
evaluation period. Where deficiencies in performance are noted, the
Contractor shall describe the actions planned or taken to correct
such deficiencies and avoid their recurrence. The DOE Operations/
Field Office Manager, or designee, will review the Contractor's
self-assessment, if submitted, as part of its independent evaluation
of the Contractor's management during the period. A self-assessment,
in and of itself may not be the only basis for the award fee
determination.
970.5215-2 Make-or-buy plan.
As prescribed in 48 CFR 970.1504-5(b), insert the following clause:
Make-or-Buy Plan (DEC 2000)
(a) Definitions.
Buy item means a work activity, supply, or service to be
produced or performed by an outside source, including a
subcontractor or an affiliate, subsidiary, or division of the
contractor.
Make item means a work activity, supply, or service to be
produced or performed by the contractor using its personnel and
other resources at the Department of Energy facility or site.
Make-or-buy plan means a contractor's written program for the
contract that identifies work efforts or requirements that either
are ``make items'' or ``buy items.''
(b) Make-or-buy plan. The contractor shall develop and implement
a make-or-buy plan that establishes a preference for providing
supplies and services on a least-cost basis, subject to any specific
make or buy criteria identified in the contract or otherwise
provided by the contracting officer. In developing and implementing
its make-or-buy plan, the contractor agrees to assess subcontracting
opportunities and implement subcontracting decisions in accordance
with the following:
(1) The contractor shall conduct internal productivity
improvement and cost-reduction programs so that in-house performance
options can be made more efficient and cost-effective.
(2) The contractor shall consider subcontracting opportunities
with the maximum practicable regard for open communications with
potentially affected employees and their representatives. Similarly,
a contractor shall communicate its plans, activities, cost-benefit
analyses, and decisions to those stakeholders, including
representatives of the community and local businesses, likely to be
affected by such actions.
(c) Submission and approval. For new contract awards, the
contractor shall submit an initial make-or-buy plan, for approval,
within 180 days after contract award. If the existing contract is to
be extended, the contractor shall submit a make-or-buy plan for
review and approval at least 90 days prior to the commencement of
the negotiations for the extension. The following documentation
shall be prepared and submitted:
(1) A description of the each work item, and if appropriate, the
identification of the associated Work Authorization or Work
Breakdown Structure element;
(2) The categorization of each work item as ``must make,''
``must buy,'' or ``can make or buy,'' with the reasons for such
categorization in consideration of the program specific make or buy
criteria (including least cost considerations). For non-core
capabilities categorized as ``must make,'' a cost/benefit analysis
must be performed for each item if:
(i) The contractor is not the least-cost performer, and
(ii) A program specific make-or-buy criterion does not otherwise
justify a ``must make'' categorization;
(3) A decision to either ``make'' or ``buy'' in consideration of
the program specific make or buy criteria (including least cost
considerations) for work effort categorized as ``can make or buy'';
(4) Identification of potential suppliers and subcontractors, if
known, and their location and size status;
(5) A recommendation to defer a make or buy decision where
categorization of an identifiable work effort is impracticable at
the time of initial development of the plan and a schedule for
future re-evaluation;
(6) A description of the impact of a change in current practice
of making or buying on the existing work force; and
(7) Any additional information appropriate to support and
explain the plan.
(d) Conduct of operations. Once a make-or-buy plan is approved,
the contractor shall perform in accordance with the plan.
(e) Changes to the make-or-buy plan. The make-or-buy plan
established in accordance with paragraph (b) of this clause shall
remain in effect for the term of the contract, unless:
(1) A lesser period is provided either for the total plan or for
individual items or work effort;
(2) The circumstances supporting the make-or-buy decisions
change, or
(3) New work is identified.
At least annually, the contractor shall review its approved
make-or-buy plan to ensure that it reflects current conditions.
Changes to the approved make-or-buy plan shall be submitted in
advance of the effective date of the proposed change in sufficient
time to permit evaluation and review. Changes shall be submitted in
accordance with the instructions provided by the contracting
officer. Modification of the make-or-buy plan to incorporate
proposed changes or additions shall be effective upon the
contractor's receipt of the contracting officer's written approval.
(End of Clause)
970.5215-3 Conditional payment of fee, profit, or incentives.
As prescribed in 48 CFR 970.1504-5(c), insert the following clause:
Conditional Payment of Fee, Profit, or Incentives (DEC 2000)
In order for the Contractor to receive all otherwise earned fee,
fixed fee, profit, or share of cost savings under the contract in an
evaluation period, the Contractor must meet the minimum requirements
in paragraphs (a) and (b) of this clause, and if Alternate I is
applicable, (a) through (d) of this clause. If the Contractor does
not meet the minimum requirements, the DOE Operations/Field Office
Manager or designee may make a unilateral determination to reduce
the evaluation period's otherwise earned fee, fixed fee, profit or
share of cost savings as described in the following paragraphs of
this clause.
(a) Minimum requirements for Environment, Safety & Health (ES&H)
Program. The Contractor shall develop, obtain DOE approval of, and
implement a Safety Management System in accordance with the
provisions of the clause entitled, ``Integration of Environment,
Safety and Health into Work Planning and Execution,'' if included in
the contract, or as otherwise agreed to with the contracting
officer. The minimum performance requirements of the system will be
set forth in the approved Safety Management System, or similar
document. If the Contractor fails to obtain approval of the Safety
Management System or fails to achieve the minimum performance
requirements of the system during the evaluation period, the DOE
Operations/Field Office Manager or designee, at his/her sole
discretion, may reduce any otherwise earned fees, fixed fee, profit
or share of cost savings for the evaluation period by an amount up
to the amount earned.
(b) Minimum requirements for catastrophic event. If, in the
performance of this contract, there is a catastrophic event (such as
a fatality, or a serious workplace-related injury or illness to one
or more Federal, contractor, or subcontractor employees or the
general public, loss of control over classified or special nuclear
material, or significant damage to the environment), the DOE
Operations/Field Office Manager or designee may reduce any otherwise
earned fee for the evaluation period by an amount up to the amount
earned. In determining any diminution of fee, fixed fee, profit, or
share
[[Page 81046]]
of cost savings resulting from a catastrophic event, the DOE
Operations/Field Office Manager or designee will consider whether
willful misconduct and/or negligence contributed to the occurrence
and will take into consideration any mitigating circumstances
presented by the contractor or other sources.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.1504-5(c),
for contracts awarded on a cost-plus-award-fee, incentive fee or
multiple fee basis, add the following paragraphs (c) and (d):
(c) Minimum requirements for specified level of performance. (1)
At a minimum the Contractor must perform the following:
(i) the requirements with specific incentives at the level of
performance set forth in the Statement of Work, Work Authorization
Directive, or similar document unless an otherwise minimal level of
performance has been established in the specific incentive;
(ii) all of the performance requirements directly related to
requirements specifically incentivized at a level of performance
such that the overall performance of these related requirements is
at an acceptable level; and
(iii) all other requirements at a level of performance such that
the total performance of the contract is not jeopardized.
(2) The evaluation of the Contractor's achievement of the level
of performance shall be unilaterally determined by the contracting
officer. To the extent that the Contractor fails to achieve the
minimum performance levels specified in the Statement of Work, Work
Authorization Directive, or similar document, during the evaluation
period, the DOE Operations/Field Office Manager, or designee, may
reduce any otherwise earned fee, fixed fee, profit, or shared net
savings for the evaluation period. Such reduction shall not result
in the total of earned fee, fixed fee, profit, or shared net savings
being less than 25% of the total available fee amount. Such 25%
shall include base fee, if any.
(d) Minimum requirements for cost performance. (1) Requirements
incentivized by other than cost incentives must be performed within
their specified cost constraint and must not adversely impact the
costs of performing unrelated activities.
(2) The performance of requirements with a specific cost
incentive must not adversely impact the costs of performing
unrelated requirements.
(3) The Contractor's performance within the stipulated cost
performance levels for the evaluation period shall be determined by
the contracting officer. To the extent the Contractor fails to
achieve the stipulated cost performance levels, the DOE Operations/
Field Office Manager, or designee, at his/her sole discretion, may
reduce in whole or in part any otherwise earned fee, fixed fee,
profit, or shared net savings for the evaluation period. Such
reduction shall not result in the total of earned fee, fixed fee,
profit or shared net savings being less than 25% of the total
available fee amount. Such 25% shall include base fee, if any.
970.5215-4 Cost reduction.
As prescribed in 48 CFR 970.1504-5(d), insert the following clause:
Cost Reduction (DEC 2000)
(a) General. It is the Department of Energy's (DOE's) intent to
have its facilities and laboratories operated in an efficient and
effective manner. To this end, the Contractor shall assess its
operations and identify areas where cost reductions would bring cost
efficiency to operations without adversely affecting the level of
performance required by the contract. The Contractor, to the maximum
extent practical, shall identify areas where cost reductions may be
effected, and develop and submit Cost Reduction Proposals (CRPs) to
the contracting officer. If accepted, the Contractor may share in
any shared net savings from accepted CRPs in accordance with
paragraph (g) of this clause.
(b) Definitions. Administrative cost is the contractor cost of
developing and administering the CRP.
Design, process, or method change is a change to a design,
process, or method which has established cost, technical and
schedule baseline, is defined, and is subject to a formal control
procedure. Such a change must be innovative, initiated by the
contractor, and applied to a specific project or program.
Development cost is the Contractor cost of up-front planning,
engineering, prototyping, and testing of a design, process, or
method.
DOE cost is the Government cost incurred implementing and
validating the CRP.
Implementation cost is the Contractor cost of tooling,
facilities, documentation, etc., required to effect a design,
process, or method change once it has been tested and approved.
Net Savings means a reduction in the total amount (to include
all related costs and fee) of performing the effort where the
savings revert to DOE control and may be available for deobligation.
Such savings may result from a specific cost reduction effort which
is negotiated on a cost-plus-incentive-fee, fixed-price incentive,
or firm-fixed-price basis, or may result directly from a design,
process, or method change. They may also be savings resulting from
formal or informal direction given by DOE or from changes in the
mission, work scope, or routine reorganization of the Contractor due
to changes in the budget.
Shared Net Savings are those net savings which result from:
(1) a specific cost reduction effort which is negotiated on a
cost-plus-incentive-fee or fixed-price incentive basis, and is the
difference between the negotiated target cost of performing an
effort as negotiated and the actual allowable cost of performing
that effort; or
(2) a design, process, or method change, which occurs in the
fiscal year in which the change is accepted and the subsequent
fiscal year, and is the difference between the estimated cost of
performing an effort as originally planned and the actual allowable
cost of performing that same effort utilizing a revised plan
intended to reduce costs along with any Contractor development
costs, implementation costs, administrative costs, and DOE costs
associated with the revised plan. Administrative costs and DOE costs
are only included at the discretion of the contracting officer.
Savings resulting from formal or informal direction given by the DOE
or changes in the mission, work scope, or routine reorganization of
the Contractor due to changes in the budget are not to be considered
as shared net savings for purposes of this clause and do not qualify
for incentive sharing.
(c) Procedure for submission of CRPs. (1) CRPs for the
establishment of cost-plus-incentive-fee, fixed-price incentive, or
firm-fixed-price efforts or for design, process, or methods changes
submitted by the Contractor shall contain, at a minimum, the
following:
(i) Current Method (Baseline)--A verifiable description of the
current scope of work, cost, and schedule to be impacted by the
initiative, and supporting documentation.
(ii) New Method (New Proposed Baseline)--A verifiable
description of the new scope of work, cost, and schedule, how the
initiative will be accomplished, and supporting documentation.
(iii) Feasibility Assessment--A description and evaluation of
the proposed initiative and benefits, risks, and impacts of
implementation. This evaluation shall include an assessment of the
difference between the current method (baseline) and proposed new
method including all related costs.
(2) In addition, CRPs for the establishment of cost-plus-
incentive-fee, fixed-price incentive, or firm-fixed-price efforts
shall contain, at a minimum, the following:
(i) The proposed contractual arrangement and the justification
for its use; and
(ii) A detailed cost/price estimate and supporting rationale. If
the approach is proposed on an incentive basis, minimum and maximum
cost estimates should be included along with any proposed sharing
arrangements.
(d) Evaluation and Decision. All CRPs must be submitted to and
approved by the contracting officer. Included in the information
provided by the CRP must be a discussion of the extent the proposed
cost reduction effort may:
(1) Pose a risk to the health and safety of workers, the
community, or to the environment;
(2) Result in a waiver or deviation from DOE requirements, such
as DOE Orders and joint oversight agreements;
(3) Require a change in other contractual agreements;
(4) Result in significant organizational and personnel impacts;
[[Page 81047]]
(5) Create a negative impact on the cost, schedule, or scope of
work in another area;
(6) Pose a potential negative impact on the credibility of the
Contractor or the DOE; and
(7) Impact successful and timely completion of any of the work
in the cost, technical, and schedule baseline.
(e) Acceptance or Rejection of CRPs. Acceptance or rejection of
a CRP is a unilateral determination made by the contracting officer.
The contracting officer will notify the Contractor that a CRP has
been accepted, rejected, or deferred within (Insert Number) days of
receipt. The only CRPs that will be considered for acceptance are
those which the Contractor can demonstrate, at a minimum, will:
(1) Result in net savings (in the sharing period if a design,
process, or method change);
(2) Not reappear as costs in subsequent periods; and
(3) Not result in any impairment of essential functions.
(f) The failure of the contracting officer to notify the
Contractor of the acceptance, rejection, or deferral of a CRP within
the specified time shall not be construed as approval.
(g) Adjustment to Original Estimated Cost and Fee. If a CRP is
established on a cost-plus-incentive-fee, fixed-price incentive or
firm-fixed-price basis, the originally estimated cost and fee for
the total effort shall be adjusted to remove the estimated cost and
fee amount associated with the CRP effort.
(h) Sharing Arrangement. If a CRP is accepted, the Contractor
may share in the shared net savings. For a CRP negotiated on a cost-
plus-incentive-fee or fixed-price incentive basis, with the specific
incentive arrangement (negotiated target costs, target fees, share
lines, ceilings, profit, etc.) set forth in the contractual document
authorizing the effort, the Contractor's share shall be the actual
fee or profit resulting from such an arrangement. For a CRP
negotiated as a cost savings incentive resulting from a design,
process, or method change, the Contractor's share shall be a
percentage, not to exceed 25% of the shared net savings. The
specific percentage and sharing period shall be set forth in the
contractual document.
(i) Validation of Shared Net Savings. The contracting officer
shall validate actual shared net savings. If actual shared net
savings cannot be validated, the contractor will not be entitled to
a share of the net shared savings.
(j) Relationship to Other Incentives. Only those benefits of an
accepted CRP not rewardable under other clauses of this contract
shall be rewarded under this clause.
(k) Subcontracts. The Contractor may include a clause similar to
this clause in any subcontract. In calculating any estimated shared
net savings in a CRP under this contract, the Contractor's
administration, development, and implementation costs shall include
any subcontractor's allowable costs, and any CRP incentive payments
to a subcontractor resulting from the acceptance of such CRP. The
Contractor may choose any arrangement for subcontractor CRP
incentive payments, provided that the payments not reduce the DOE's
share of shared net savings.
(End of Clause)
970.5215-5 Limitation on fee.
As prescribed in 48 CFR 970.1504-5(e), the contracting officer
shall insert the following provision:
Limitation on Fee (DEC 2000)
(a) For the purpose of this solicitation, fee amounts shall not
exceed the total available fee allowed by the fee policy at 48 CFR
970.1504-1-1, or as specifically stated elsewhere in the
solicitation.
(b) The Government reserves the unilateral right, in the event
an offeror's proposal is selected for award, to limit: fixed fee to
not exceed an amount established pursuant to 48 CFR 970.1504-1-5;
and total available fee to not exceed an amount established pursuant
to 48 CFR 970.1504-1-9; or fixed fee or total available fee to an
amount as specifically stated elsewhere in the solicitation.
(End of Clause)
970.5222-1 Collective Bargaining Agreements Management and Operating
Contracts.
As prescribed in 48 CFR 970.2201-1-3, insert the following clause:
Collective Bargaining Agreements--Management and Operating Contracts
(DEC 2000)
When negotiating collective bargaining agreements applicable to
the work force under this contract, the Contractor shall use its
best efforts to ensure such agreements contain provisions designed
to assure continuity of services. All such agreements entered into
during the contract period of performance should provide that
grievances and disputes involving the interpretation or application
of the agreement will be settled without resorting to strike,
lockout, or other interruption of normal operations. For this
purpose, each collective bargaining agreement should provide an
effective grievance procedure with arbitration as its final step,
unless the parties mutually agree upon some other method of assuring
continuity of operations. As part of such agreements, management and
labor should agree to cooperate fully with the Federal Mediation and
Conciliation Service. The contractor shall include the substance of
this clause in any subcontracts for protective services or other
services performed on the DOE-owned site which will affect the
continuity of operation of the facility.
(End of Clause)
970.5222-2 Overtime management.
As prescribed in 48 CFR 970.2201-2-2, insert the following clause:
Overtime Management (DEC 2000)
(a) The contractor shall maintain adequate internal controls to
ensure that employee overtime is authorized only if cost effective
and necessary to ensure performance of work under this contract.
(b) The contractor shall notify the contracting officer when in
any given year it is likely that overtime usage as a percentage of
payroll may exceed 4%.
(c) The contracting officer may require the submission, for
approval, of a formal annual overtime control plan whenever
contractor overtime usage as a percentage of payroll has exceeded,
or is likely to exceed, 4%, or if the contracting officer otherwise
deems overtime expenditures excessive. The plan shall include, at a
minimum:
(1) An overtime premium fund (maximum dollar amount);
(2) Specific controls for casual overtime for non-exempt
employees;
(3) Specific parameters for allowability of exempt overtime;
(4) An evaluation of alternatives to the use of overtime; and
(5) Submission of a semi-annual report that includes for exempt
and non-exempt employees:
(i) Total cost of overtime;
(ii) Total cost of straight time;
(iii) Overtime cost as a percentage of straight-time cost;
(iv) Total overtime hours;
(v) Total straight-time hours; and
(vi) Overtime hours as a percentage of straight-time hours.
(End of Clause)
970.5223-1 Integration of environment, safety, and health into work
planning and execution.
As prescribed in 48 CFR 970.2303-2(a), insert the following clause:
Integration of Environment, Safety, and Health Into Work Planning and
Execution (DEC 2000)
(a) For the purposes of this clause,
(1) Safety encompasses environment, safety and health, including
pollution prevention and waste minimization; and
(2) Employees include subcontractor employees.
(b) In performing work under this contract, the contractor shall
perform work safely, in a manner that ensures adequate protection
for employees, the public, and the environment, and shall be
accountable for the safe performance of work. The contractor shall
exercise a degree of care commensurate with the work and the
associated hazards. The contractor shall ensure that management of
environment, safety and health (ES&H) functions and activities
becomes an integral but visible part of the contractor's work
planning and execution processes. The contractor shall, in the
performance of work, ensure that:
(1) Line management is responsible for the protection of
employees, the public, and the environment. Line management includes
those contractor and subcontractor employees managing or supervising
employees performing work.
(2) Clear and unambiguous lines of authority and responsibility
for ensuring (ES&H) are established and maintained at all
organizational levels.
(3) Personnel possess the experience, knowledge, skills, and
abilities that are necessary to discharge their responsibilities.
(4) Resources are effectively allocated to address ES&H,
programmatic, and operational considerations. Protecting employees,
the public, and the environment is a priority whenever activities
are planned and performed.
[[Page 81048]]
(5) Before work is performed, the associated hazards are
evaluated and an agreed-upon set of ES&H standards and requirements
are established which, if properly implemented, provide adequate
assurance that employees, the public, and the environment are
protected from adverse consequences.
(6) Administrative and engineering controls to prevent and
mitigate hazards are tailored to the work being performed and
associated hazards. Emphasis should be on designing the work and/or
controls to reduce or eliminate the hazards and to prevent accidents
and unplanned releases and exposures.
(7) The conditions and requirements to be satisfied for
operations to be initiated and conducted are established and agreed-
upon by DOE and the contractor. These agreed-upon conditions and
requirements are requirements of the contract and binding upon the
contractor. The extent of documentation and level of authority for
agreement shall be tailored to the complexity and hazards associated
with the work and shall be established in a Safety Management
System.
(c) The contractor shall manage and perform work in accordance
with a documented Safety Management System (System) that fulfills
all conditions in paragraph (b) of this clause at a minimum.
Documentation of the System shall describe how the contractor will:
(1) Define the scope of work;
(2) Identify and analyze hazards associated with the work;
(3) Develop and implement hazard controls;
(4) Perform work within controls; and
(5) Provide feedback on adequacy of controls and continue to
improve safety management.
(d) The System shall describe how the contractor will establish,
document, and implement safety performance objectives, performance
measures, and commitments in response to DOE program and budget
execution guidance while maintaining the integrity of the System.
The System shall also describe how the contractor will measure
system effectiveness.
(e) The contractor shall submit to the contracting officer
documentation of its System for review and approval. Dates for
submittal, discussions, and revisions to the System will be
established by the contracting officer. Guidance on the preparation,
content, review, and approval of the System will be provided by the
contracting officer. On an annual basis, the contractor shall review
and update, for DOE approval, its safety performance objectives,
performance measures, and commitments consistent with and in
response to DOE's program and budget execution guidance and
direction. Resources shall be identified and allocated to meet the
safety objectives and performance commitments as well as maintain
the integrity of the entire System. Accordingly, the System shall be
integrated with the contractor's business processes for work
planning, budgeting, authorization, execution, and change control.
(f) The contractor shall comply with, and assist the Department
of Energy in complying with, ES&H requirements of all applicable
laws and regulations, and applicable directives identified in the
clause of this contract entitled ``Laws, Regulations, and DOE
Directives.'' The contractor shall cooperate with Federal and non-
Federal agencies having jurisdiction over ES&H matters under this
contract.
(g) The contractor shall promptly evaluate and resolve any
noncompliance with applicable ES&H requirements and the System. If
the contractor fails to provide resolution or if, at any time, the
contractor's acts or failure to act causes substantial harm or an
imminent danger to the environment or health and safety of employees
or the public, the contracting officer may issue an order stopping
work in whole or in part. Any stop work order issued by a
contracting officer under this clause (or issued by the contractor
to a subcontractor in accordance with paragraph (i) of this clause)
shall be without prejudice to any other legal or contractual rights
of the Government. In the event that the contracting officer issues
a stop work order, an order authorizing the resumption of the work
may be issued at the discretion of the contracting officer. The
contractor shall not be entitled to an extension of time or
additional fee or damages by reason of, or in connection with, any
work stoppage ordered in accordance with this clause.
(h) Regardless of the performer of the work, the contractor is
responsible for compliance with the ES&H requirements applicable to
this contract. The contractor is responsible for flowing down the
ES&H requirements applicable to this contract to subcontracts at any
tier to the extent necessary to ensure the contractor's compliance
with the requirements.
(i) The contractor shall include a clause substantially the same
as this clause in subcontracts involving complex or hazardous work
on site at a DOE-owned or -leased facility. Such subcontracts shall
provide for the right to stop work under the conditions described in
paragraph (g) of this clause. Depending on the complexity and
hazards associated with the work, the contractor may choose not to
require the subcontractor to submit a Safety Management System for
the contractor's review and approval.
(End of Clause)
970.5223-2 Acquisition and use of environmentally preferable products
and services.
As prescribed in 48 CFR 970.2304-2, insert the following clause:
Acquisition and Use of Environmentally Preferable Products and Services
(DEC 2000)
(a) In the performance of this contract, the Contractor shall
comply with the requirements of the following issuances:
(1) Executive Order 13101 of September 14, 1998, entitled
``Greening the Government Through Waste Prevention, Recycling and
Federal Acquisition.''
(2) Section 6002 of the Resource Conservation and Recovery Act
(RCRA) of 1976, as amended (42 U.S.C. 6962, Pub. L. 94-580, 90 Stat.
2822),
(3) Title 40 of the Code of Federal Regulations, Subchapter I,
Part 247 (Comprehensive Guidelines for the Procurement of Products
Containing Recovered Materials) and such other Subchapter I Parts or
Comprehensive Procurement Guidelines as the Environmental Protection
Agency may issue from time to time as guidelines for the procurement
of products that contain recovered/recycled materials,
(4) ``U.S. Department of Energy Affirmative Procurement Program
for Products Containing Recovered Materials'' and related guidance
document(s), as they are identified in writing by the Department.
(b) The Contractor shall prepare and submit reports on matters
related to the use of environmentally preferable products and
services from time to time in accordance with written direction
(e.g., in a specified format) from the contracting officer.
(c) In complying with the requirements of paragraph (a) of this
clause, the Contractor shall coordinate its concerns and seek
implementing guidance on Federal and Departmental policy, plans, and
program guidance with the DOE recycling point of contact, who shall
be identified by the contracting officer. Reports required pursuant
to paragraph (b) of this clause, shall be submitted through the DOE
recycling point of contact.
(End of Clause)
970.5223-3 Agreement regarding Workplace Substance Abuse Programs at
DOE facilities.
As prescribed in 970.2305-4(a), the contracting officer shall
insert the following provision:
Agreement Regarding Workplace Substance Abuse Programs at DOE Sites
(DEC 2000)
(a) Any contract awarded as a result of this solicitation will
be subject to the policies, criteria, and procedures of 10 CFR part
707, Workplace Substance Abuse Programs at DOE Sites.
(b) By submission of its offer, the officer agrees to provide to
the contracting officer, within 30 days after notification of
selection for award, or award of a contract, whichever occurs first,
pursuant to this solicitation, its written workplace substance abuse
program consistent with the requirements of 10 CFR part 707.
(c) Failure of the offeror to agree to the condition of
responsibility set forth in paragraph (b) of this provision, renders
the offeror unqualified and ineligible for award.
(End of Provision)
970.5223-4 Workplace Substance Abuse Programs at DOE Sites.
As prescribed in 48 CFR 970.2305-4(b), insert the following clause:
Workplace Substance Abuse Programs at DOE Sites (DEC 2000)
(a) Program Implementation. The contractor shall, consistent
with 10 CFR part 707, Workplace Substance Abuse Programs at DOE
Sites, incorporated herein by reference with full force and effect,
develop, implement, and maintain a workplace substance abuse
program.
(b) Remedies. In addition to any other remedies available to the
Government, the
[[Page 81049]]
contractor's failure to comply with the requirements of 10 CFR part
707 or to perform in a manner consistent with its approved program
may render the contractor subject to: the suspension of contract
payments, or, where applicable, a reduction in award fee;
termination for default; and suspension or debarment.
(c) Subcontracts. (1) The contractor agrees to notify the
contracting officer reasonably in advance of, but not later than 30
days prior to, the award of any subcontract the contractor believes
may be subject to the requirements of 10 CFR part 707.
(2) The DOE prime contractor shall require all subcontracts
subject to the provisions of 10 CFR part 707 to agree to develop and
implement a workplace substance abuse program that complies with the
requirements of 10 CFR part 707, Workplace Substance Abuse Programs
at DOE Sites, as a condition for award of the subcontract. The DOE
prime contractor shall review and approve each subcontractor's
program, and shall periodically monitor each subcontractor's
implementation of the program for effectiveness and compliance with
10 CFR part 707.
(3) The contractor agrees to include, and require the inclusion
of, the requirements of this clause in all subcontracts, at any
tier, that are subject to the provisions of 10 CFR part 707.
(End of clause)
970.5226-1 Diversity plan.
As prescribed in 48 CFR 970.2671-2, insert the following clause:
Diversity Plan (DEC 2000)
The Contractor shall submit a Diversity Plan to the contracting
officer for approval within 90 days after the effective date of this
contract (or contract modification, if appropriate). The contractor
shall submit an update to its Plan annually or with its annual fee
proposal. Guidance for preparation of a Diversity Plan is provided
in Appendix __. The Plan shall include innovative strategies for
increasing opportunities to fully use the talents and capabilities
of a diverse work force. The Plan shall address, at a minimum, the
Contractor's approach for promoting diversity through (1) the
Contractor's work force, (2) educational outreach, (3) community
involvement and outreach, (4) subcontracting, (5) economic
development (including technology transfer), and (6) the prevention
of profiling based on race or national origin.
(End of Clause)
970.5226-2 Workforce restructuring under section 3161 of the National
Defense Authorization Act for fiscal year 1993.
As prescribed in 48 CFR 970.2672-3, insert the following clause:
Workforce Restructuring under Section 3161 of the National Defense
Authorization Act for Fiscal Year 1993 (DEC 2000)
(a) Consistent with the objectives of Section 3161 of the
National Defense Authorization Act for Fiscal Year 1993, 42 U.S.C.
7274h, in instances where the Department of Energy has determined
that a change in workforce at a Department of Energy Defense Nuclear
Facility is necessary, the contractor agrees to (1) comply with the
Department of Energy Workforce Restructuring Plan for the facility,
if applicable, and (2) use its best efforts to accomplish workforce
restructuring or displacement so as to mitigate social and economic
impacts.
(b) The requirements of this clause shall be included in
subcontracts at any tier (except subcontracts for commercial items
pursuant to 41 U.S.C. 403) expected to exceed $500,000.
(End of Clause)
970.5226-3 Community commitment.
As prescribed in 48 CFR 970.2673-2, insert the following clause:
Community Commitment (DEC 2000)
It is the policy of the DOE to be a constructive partner in the
geographic region in which DOE conducts its business. The basic
elements of this policy include: (1) Recognizing the diverse
interests of the region and its stakeholders, (2) engaging regional
stakeholders in issues and concerns of mutual interest, and (3)
recognizing that giving back to the community is a worthwhile
business practice. Accordingly, the Contractor agrees that its
business operations and performance under the Contract will be
consistent with the intent of the policy and elements set forth
above.
(End of Clause)
970.5227-1 Rights in data-facilities.
As prescribed in 48 CFR 970.2704-3(a), insert the following clause:
Rights in Data--Facilities (DEC 2000)
(a) Definitions. (1) Computer data bases, as used in this
clause, means a collection of data in a form capable of, and for the
purpose of, being stored in, processed, and operated on by a
computer. The term does not include computer software.
(2) Computer software, as used in this clause, means (i)
computer programs which are data comprising a series of
instructions, rules, routines, or statements, regardless of the
media in which recorded, that allow or cause a computer to perform a
specific operation or series of operations and (ii) data comprising
source code listings, design details, algorithms, processes, flow
charts, formulae, and related material that would enable the
computer program to be produced, created, or compiled. The term does
not include computer data bases.
(3) Data, as used in this clause, means recorded information,
regardless of form or the media on which it may be recorded. The
term includes technical data and computer software. The term
``data'' does not include data incidental to the administration of
this contract, such as financial, administrative, cost and pricing,
or management information.
(4) Limited rights data, as used in this clause, means data,
other than computer software, developed at private expense that
embody trade secrets or are commercial or financial and confidential
or privileged. The Government's rights to use, duplicate, or
disclose limited rights data are as set forth in the Limited Rights
Notice of subparagraph (e) of this clause.
(5) Restricted computer software, as used in this clause, means
computer software developed at private expense and that is a trade
secret; is commercial or financial and is confidential or
privileged; or is published copyrighted computer software, including
minor modifications of any such computer software. The Government's
rights to use, duplicate, or disclose restricted computer software
are as set forth in the Restricted Rights Notice of paragraph (f) of
this clause.
(6) Technical data, as used in this clause, means recorded data,
regardless of form or characteristic, that are of a scientific or
technical nature. Technical data does not include computer software,
but does include manuals and instructional materials and technical
data formatted as a computer data base.
(7) Unlimited rights, as used in this clause, means the right of
the Government to use, disclose, reproduce, prepare derivative
works, distribute copies to the public, including by electronic
means, and perform publicly and display publicly, in any manner,
including by electronic means, and for any purpose whatsoever, and
to have or permit others to do so.
(b) Allocation of Rights. (1) The Government shall have:
(i) Ownership of all technical data and computer software first
produced in the performance of this Contract;
(ii) Unlimited rights in technical data and computer software
specifically used in the performance of this Contract, except as
provided herein regarding copyright, limited rights data, or
restricted computer software, or except for other data specifically
protected by statute for a period of time or, where, approved by
DOE, appropriate instances of the DOE Work for Others Program;
(iii) The right to inspect technical data and computer software
first produced or specifically used in the performance of this
Contract at all reasonable times. The Contractor shall make
available all necessary facilities to allow DOE personnel to perform
such inspection;
(iv) The right to have all technical data and computer software
first produced or specifically used in the performance of this
Contract delivered to the Government or otherwise disposed of by the
Contractor, either as the contracting officer may from time to time
direct during the progress of the work or in any event as the
contracting officer shall direct upon completion or termination of
this Contract. The Contractor agrees to leave a copy of such data at
the facility or plant to which such data relate, and to make
available for access or to deliver to the Government such data upon
request by the contracting officer. If such data are limited rights
data or restricted computer
[[Page 81050]]
software, the rights of the Government in such data shall be
governed solely by the provisions of paragraph (e) of this clause
(``Rights in Limited Rights Data'') or paragraph (f) of this clause
(``Rights in Restricted Computer Software''); and
(v) The right to remove, cancel, correct, or ignore any markings
not authorized by the terms of this Contract on any data furnished
hereunder if, in response to a written inquiry by DOE concerning the
propriety of the markings, the Contractor fails to respond thereto
within 60 days or fails to substantiate the propriety of the
markings. In either case DOE will notify the Contractor of the
action taken.
(2) The Contractor shall have:
(i) The right to withhold limited rights data and restricted
computer software unless otherwise provided in accordance with the
provisions of this clause; and
(ii) The right to use for its private purposes, subject to
patent, security or other provisions of this Contract, data it first
produces in the performance of this Contract, except for data in
DOE's Uranium Enrichment Technology, including diffusion,
centrifuge, and atomic vapor laser isotope separation, provided the
data requirements of this Contract have been met as of the date of
the private use of such data.
(3) The Contractor agrees that for limited rights data or
restricted computer software or other technical, business or
financial data in the form of recorded information which it receives
from, or is given access to by, DOE or a third party, including a
DOE Contractor or subcontractor, and for technical data or computer
software it first produces under this Contract which is authorized
to be marked by DOE, the Contractor shall treat such data in
accordance with any restrictive legend contained thereon.
(c) Copyrighted Material. (1) The Contractor shall not, without
prior written authorization of the Patent Counsel, assert copyright
in any technical data or computer software first produced in the
performance of this contract. To the extent such authorization is
granted, the Government reserves for itself and others acting on its
behalf, a nonexclusive, paid-up, irrevocable, world-wide license for
Governmental purposes to publish, distribute, translate, duplicate,
exhibit, and perform any such data copyrighted by the Contractor.
(2) The Contractor agrees not to include in the technical data
or computer software delivered under the contract any material
copyrighted by the Contractor and not to knowingly include any
material copyrighted by others without first granting or obtaining
at no cost a license therein for the benefit of the Government of
the same scope as set forth in paragraph (c)(1) of this clause. If
the Contractor believes that such copyrighted material for which the
license cannot be obtained must be included in the technical data or
computer software to be delivered, rather than merely incorporated
therein by reference, the Contractor shall obtain the written
authorization of the contracting officer to include such material in
the technical data or computer software prior to its delivery.
(d) Subcontracting. (1) Unless otherwise directed by the
contracting officer, the Contractor agrees to use in subcontracts in
which technical data or computer software is expected to be produced
or in subcontracts for supplies that contain a requirement for
production or delivery of data in accordance with the policy and
procedures of 48 CFR Subpart 27.4 as supplemented by 48 CFR 927.401
through 927.409, the clause entitled, ``Rights in Data-General'' at
48 CFR 52.227-14 modified in accordance with 927.409(a) and
including Alternate V. Alternates II through IV of that clause may
be included as appropriate with the prior approval of DOE Patent
Counsel, and the Contractor shall not acquire rights in a
subcontractor's limited rights data or restricted computer software,
except through the use of Alternates II or III, respectively,
without the prior approval of DOE Patent Counsel. The clause at 48
CFR 52.227-16, Additional Data Requirements, shall be included in
subcontracts in accordance with DEAR 927.409(h). The contractor
shall use instead the Rights in Data-Facilities clause at 48 CFR
970.5227-1 in subcontracts, including subcontracts for related
support services, involving the design or operation of any plants or
facilities or specially designed equipment for such plants or
facilities that are managed or operated under its contract with DOE.
(2) It is the responsibility of the Contractor to obtain from
its subcontractors technical data and computer software and rights
therein, on behalf of the Government, necessary to fulfill the
Contractor's obligations to the Government with respect to such
data. In the event of refusal by a subcontractor to accept a clause
affording the Government such rights, the Contractor shall:
(i) Promptly submit written notice to the contracting officer
setting forth reasons or the subcontractor's refusal and other
pertinent information which may expedite disposition of the matter,
and
(ii) Not proceed with the subcontract without the written
authorization of the contracting officer.
(3) Neither the Contractor nor higher-tier subcontractors shall
use their power to award subcontracts as economic leverage to
acquire rights in a subcontractor's limited rights data or
restricted computer software for their private use.
(e) Rights in Limited Rights Data. Except as may be otherwise
specified in this Contract as data which are not subject to this
paragraph, the Contractor agrees to and does hereby grant to the
Government an irrevocable, nonexclusive, paid-up license by or for
the Government, in any limited rights data of the Contractor
specifically used in the performance of this Contract, provided,
however, that to the extent that any limited rights data when
furnished or delivered is specifically identified by the Contractor
at the time of initial delivery to the Government or a
representative of the Government, such data shall not be used within
or outside the Government except as provided in the ``Limited Rights
Notice'' set forth. All such limited rights data shall be marked
with the following ``Limited Rights Notice'':
Limited Rights Notice
These data contain ``limited rights data,'' furnished under
Contract No. ________________ with the United States Department of
Energy which may be duplicated and used by the Government with the
express limitations that the ``limited rights data'' may not be
disclosed outside the Government or be used for purposes of
manufacture without prior permission of the Contractor, except that
further disclosure or use may be made solely for the following
purposes:
(a) Use (except for manufacture) by support services contractors
within the scope of their contracts;
(b) This ``limited rights data'' may be disclosed for evaluation
purposes under the restriction that the ``limited rights data'' be
retained in confidence and not be further disclosed;
(c) This ``limited rights data'' may be disclosed to other
contractors participating in the Government's program of which this
Contract is a part for information or use (except for manufacture)
in connection with the work performed under their contracts and
under the restriction that the ``limited rights data'' be retained
in confidence and not be further disclosed;
(d) This ``limited rights data'' may be used by the Government
or others on its behalf for emergency repair or overhaul work under
the restriction that the ``limited rights data'' be retained in
confidence and not be further disclosed; and
(e) Release to a foreign government, or instrumentality thereof,
as the interests of the United States Government may require, for
information or evaluation, or for emergency repair or overhaul work
by such government. This Notice shall be marked on any reproduction
of this data in whole or in part.
(End of Notice)
(f) Rights in Restricted Computer Software. (1) Except as may be
otherwise specified in this Contract as data which are not subject
to this paragraph, the Contractor agrees to and does hereby grant to
the Government an irrevocable, nonexclusive, paid-up, license by or
for the Government, in any restricted computer software of the
Contractor specifically used in the performance of this Contract,
provided, however, that to the extent that any restricted computer
software when furnished or delivered is specifically identified by
the Contractor at the time of initial delivery to the Government or
a representative of the Government, such data shall not be used
within or outside the Government except as provided in the
``Restricted Rights Notice'' set forth below. All such restricted
computer software shall be marked with the following ``Restricted
Rights Notice'':
Restricted Rights Notice-Long Form
(a) This computer software is submitted with restricted rights
under Department of Energy Contract No. ______________. It may not
be used, reproduced, or disclosed by the Government except as
provided in paragraph (b) of this notice.
(b) This computer software may be:
(1) Used or copied for use in or with the computer or computers
for which it was acquired, including use at any Government
installation to which such computer or computers may be transferred;
(2) Used, copied for use, in a backup or replacement computer if
any computer for
[[Page 81051]]
which it was acquired is inoperative or is replaced;
(3) Reproduced for safekeeping (archives) or backup purposes;
(4) Modified, adapted, or combined with other computer software,
provided that only the portions of the derivative software
consisting of the restricted computer software are to be made
subject to the same restricted rights; and
(5) Disclosed to and reproduced for use by contractors under a
service contract (of the type defined in 48 CFR 37.101) in
accordance with subparagraphs (b)(1) through (4) of this Notice,
provided the Government makes such disclosure or reproduction
subject to these restricted rights.
(c) Notwithstanding the foregoing, if this computer software has
been published under copyright, it is licensed to the Government,
without disclosure prohibitions, with the rights set forth in the
restricted rights notice above.
(d) This Notice shall be marked on any reproduction of this
computer software, in whole or in part.
(End of Notice)
(2) Where it is impractical to include the Restricted Rights
Notice on restricted computer software, the following short-form
Notice may be used.
Restricted Rights Notice--Short Form
Use, reproduction, or disclosure is subject to restrictions set
forth in the Long Form Notice of DOE Contract No. ______________
with (name of Contractor).
(End of Notice)
(3) If the software is embedded, or if it is commercially
impractical to mark it with human readable text, then the symbol R
and the clause date (mo/yr), in brackets or a box, a [R-mo/yr], may
be used. This will be read to mean restricted computer software,
subject to the rights of the Government as described in the Long
Form Notice, in effect as of the date indicated next to the symbol.
The symbol shall not be used to mark human readable material. In the
event this Contract contains any variation to the rights in the Long
Form Notice, then the contract number must also be cited.
(4) If restricted computer software is delivered with the
copyright notice of 17 U.S.C. 401, the software will be presumed to
be published copyrighted computer software licensed to the
Government without disclosure prohibitions and with unlimited
rights, unless the Contractor includes the following statement with
such copyright notice ``Unpublished-rights reserved under the
Copyright Laws of the United States.''
(g) Relationship to patents. Nothing contained in this clause
creates or is intended to imply a license to the Government in any
patent or is intended to be construed as affecting the scope of any
licenses or other rights otherwise granted to the Government under
any patent.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.2704-3(a),
where access to Category C-24 restricted data is contemplated in the
performance of a contract the contracting officer shall insert the
phrase ``and except Restricted Data in category C-24, 10 CFR part
725, in which DOE has reserved the right to receive reasonable
compensation for the use of its inventions and discoveries,
including related data and technology'' after ``laser isotope
separation'' and before the comma in paragraph (b)(2)(ii) of the
clause at 48 CFR 970.5227-1, Rights in Data--Facilities, as
appropriate.
(End of Clause)
970.5227-2 Rights in data-technology transfer.
As prescribed in 48 CFR 970.2704-3(b), insert the following clause:
Rights in Data--Technology Transfer (DEC 2000)
(a) Definitions. (1) Computer data bases, as used in this
clause, means a collection of data in a form capable of, and for the
purpose of, being stored in, processed, and operated on by a
computer. The term does not include computer software.
(2) Computer software, as used in this clause, means (i)
computer programs which are data comprising a series of
instructions, rules, routines, or statements, regardless of the
media in which recorded, that allow or cause a computer to perform a
specific operation or series of operations and (ii) data comprising
source code listings, design details, algorithms, processes, flow
charts, formulae, and related material that would enable the
computer program to be produced, created, or compiled. The term does
not include computer data bases.
(3) Data, as used in this clause, means recorded information,
regardless of form or the media on which it may be recorded. The
term includes technical data and computer software. The term
``data'' does not include data incidental to the administration of
this contract, such as financial, administrative, cost and pricing,
or management information.
(4) Limited rights data, as used in this clause, means data,
other than computer software, developed at private expense that
embody trade secrets or are commercial or financial and confidential
or privileged. The Government's rights to use, duplicate, or
disclose limited rights data are as set forth in the Limited Rights
Notice of paragraph (g) of this clause.
(5) Restricted computer software, as used in this clause, means
computer software developed at private expense and that is a trade
secret; is commercial or financial and is confidential or
privileged; or is published copyrighted computer software, including
minor modifications of any such computer software. The Government's
rights to use, duplicate, or disclose restricted computer software
are as set forth in the Restricted Rights Notice of subparagraph (h)
of this clause.
(6) Technical data, as used in this clause, means recorded data,
regardless of form or characteristic, that are of a scientific or
technical nature. Technical data does not include computer software,
but does include manuals and instructional materials and technical
data formatted as a computer data base.
(7) Unlimited rights, as used in this clause, means the rights
of the Government to use, disclose, reproduce, prepare derivative
works, distribute copies to the public, including by electronic
means, and perform publicly and display publicly, in any manner,
including by electronic means, and for any purpose whatsoever, and
to have or permit others to do so.
(b) Allocation of Rights. (1) The Government shall have:
(i) Ownership of all technical data and computer software first
produced in the performance of this Contract;
(ii) Unlimited rights in technical data and computer software
specifically used in the performance of this Contract, except as
provided herein regarding copyright, limited rights data, or
restricted computer software, and except for data subject to the
withholding provisions for protected Cooperative Research and
Development Agreement (CRADA) information in accordance with
Technology Transfer actions under this Contract, or other data
specifically protected by statute for a period of time or, where,
approved by DOE, appropriate instances of the DOE Work for Others
Program;
(iii) The right to inspect technical data and computer software
first produced or specifically used in the performance of this
Contract at all reasonable times. The Contractor shall make
available all necessary facilities to allow DOE personnel to perform
such inspection;
(iv) The right to have all technical data and computer software
first produced or specifically used in the performance of this
Contract delivered to the Government or otherwise disposed of by the
Contractor, either as the contracting officer may from time to time
direct during the progress of the work or in any event as the
contracting officer shall direct upon completion or termination of
this Contract. The Contractor agrees to leave a copy of such data at
the facility or plant to which such data relate, and to make
available for access or to deliver to the Government such data upon
request by the contracting officer. If such data are limited rights
data or restricted computer software. the rights of the Government
in such data shall be governed solely by the provisions of paragraph
(g) of this clause (``Rights in Limited Rights Data'') or paragraph
(h) of this clause (``Rights in Restricted Computer Software''); and
(v) The right to remove, cancel, correct, or ignore any markings not
authorized by the terms of this Contract on any data furnished
hereunder if, in response to a written inquiry by DOE concerning the
propriety of the markings, the Contractor fails to respond thereto
within 60 days or fails to substantiate the propriety of the
markings. In either case DOE will notify the Contractor of the
action taken.
(2) The Contractor shall have:
(i) The right to withhold limited rights data and restricted
computer software unless otherwise provided in provisions of this
clause;
(ii) The right to use for its private purposes, subject to
patent, security or other provisions of this Contract, data it first
produces in the performance of this Contract, except for data in
DOE's Uranium Enrichment Technology, including diffusion,
centrifuge, and atomic
[[Page 81052]]
vapor laser isotope separation, provided the data requirements of
this Contract have been met as of the date of the private use of
such data; and
(iii) The right to assert copyright subsisting in scientific and
technical articles as provided in paragraph (d) of this clause and
the right to request permission to assert copyright subsisting in
works other than scientific and technical articles as provided in
paragraph (e) of this clause.
(3) The Contractor agrees that for limited rights data or
restricted computer software or other technical business or
financial data in the form of recorded information which it receives
from, or is given access to by DOE or a third party, including a DOE
contractor or subcontractor, and for technical data or computer
software it first produces under this Contract which is authorized
to be marked by DOE, the Contractor shall treat such data in
accordance with any restrictive legend contained thereon.
(c) Copyright (General). (1) The Contractor agrees not to mark,
register, or otherwise assert copyright in any data in a published
or unpublished work, other than as set forth in paragraphs (d) and
(e) of this clause.
(2) Except for material to which the Contractor has obtained the
right to assert copyright in accordance with either paragraph (d) or
(e) of this clause, the Contractor agrees not to include in the data
delivered under this Contract any material copyrighted by the
Contractor and not to knowingly include any material copyrighted by
others without first granting or obtaining at no cost a license
therein for the benefit of the Government of the same scope as set
forth in paragraph (d) of this clause. If the Contractor believes
that such copyrighted material for which the license cannot be
obtained must be included in the data to be delivered, rather than
merely incorporated therein by reference, the Contractor shall
obtain the written authorization of the contracting officer to
include such material in the data prior to its delivery.
(d) Copyrighted works (scientific and technical articles). (1)
The Contractor shall have the right to assert, without prior
approval of the contracting officer, copyright subsisting in
scientific and technical articles composed under this contract or
based on or containing data first produced in the performance of
this Contract, and published in academic, technical or professional
journals, symposia, proceedings, or similar works. When assertion of
copyright is made, the Contractor shall affix the applicable
copyright notice of 17 U.S.C. 401 or 402 and acknowledgment of
Government sponsorship (including contract number) on the data when
such data are delivered to the Government as well as when the data
are published or deposited for registration as a published work in
the U.S. Copyright Office. The Contractor grants to the Government,
and others acting on its behalf, a nonexclusive, paid-up,
irrevocable, world-wide license in such copyrighted data to
reproduce, prepare derivative works, distribute copies to the
public, and perform publicly and display publicly, by or on behalf
of the Government.
(2) The contractor shall mark each scientific or technical
article first produced or composed under this Contract and submitted
for journal publication or similar means of dissemination with a
notice, similar in all material respects to the following, on the
front reflecting the Government's non-exclusive, paid-up,
irrevocable, world-wide license in the copyright.
Notice: This manuscript has been authored by [insert the name of
the Contractor] under Contract No. [insert the contract number] with
the U.S. Department of Energy. The United States Government retains
and the publisher, by accepting the article for publication,
acknowledges that the United States Government retains a non-
exclusive, paid-up, irrevocable, world-wide license to publish or
reproduce the published form of this manuscript, or allow others to
do so, for United States Government purposes.
(End of Notice)
(3) The title to the copyright of the original of unclassified
graduate theses and the original of related unclassified scientific
papers shall vest in the author thereof, subject to the right of DOE
to retain duplicates of such documents and to use such documents for
any purpose whatsoever without any claim on the part of the author
or the contractor for additional compensation.
(e) Copyrighted works (other than scientific and technical
articles and data produced under a CRADA). The Contractor may obtain
permission to assert copyright subsisting in technical data and
computer software first produced by the Contractor in performance of
this Contract, where the Contractor can show that commercialization
would be enhanced by such copyright protection, subject to the
following:
(1) Contractor Request to Assert Copyright.
(i) For data other than scientific and technical articles and
data produced under a CRADA, the Contractor shall submit in writing
to Patent Counsel its request to assert copyright in data first
produced in the performance of this Contract pursuant to this
clause. The right of the Contractor to copyright data first produced
under a CRADA is as described in the individual CRADA. Each request
by the Contractor must include:
(A) The identity of the data (including any computer program)
for which the Contractor requests permission to assert copyright, as
well as an abstract which is descriptive of the data and is suitable
for dissemination purposes, (B) The program under which it was
funded, (C) Whether, to the best knowledge of the Contractor, the
data is subject to an international treaty or agreement, (D) Whether
the data is subject to export control, (E) A statement that the
Contractor plans to commercialize the data in compliance with the
clause of this contract entitled, ``Technology Transfer Mission,''
within five (5) years after obtaining permission to assert copyright
or, on a case-by-case basis, a specified longer period where the
Contractor can demonstrate that the ability to commercialize
effectively is dependent upon such longer period, and (F) For data
other than computer software, a statement explaining why the
assertion of copyright is necessary to enhance commercialization and
is consistent with DOE's dissemination responsibilities.
(ii) For data that is developed using other funding sources in
addition to DOE funding, the permission to assert copyright in
accordance with this clause must also be obtained by the Contractor
from all other funding sources prior to the Contractor's request to
Patent Counsel. The request shall include the Contractor's
certification or other documentation acceptable to Patent Counsel
demonstrating such permission has been obtained.
(iii) Permission for the Contractor to assert copyright in
excepted categories of data as determined by DOE will be expressly
withheld. Such excepted categories include data whose release (A)
would be detrimental to national security, i.e., involve classified
information or data or sensitive information under Section 148 of
the Atomic Energy Act of 1954, as amended, or are subject to export
control for nonproliferation and other nuclear-related national
security purposes, (B) would not enhance the appropriate transfer or
dissemination and commercialization of such data, (C) would have a
negative impact on U.S. industrial competitiveness, (D) would
prevent DOE from meeting its obligations under treaties and
international agreements, or (E) would be detrimental to one or more
of DOE's programs. Additional excepted categories may be added by
the Assistant General Counsel for Technology Transfer and
Intellectual Property. Where data are determined to be under export
control restriction, the Contractor may obtain permission to assert
copyright subject to the provisions of this clause for purposes of
limited commercialization in a manner that complies with export
control statutes and applicable regulations. In addition,
notwithstanding any other provision of this Contract, all data
developed with Naval Reactors' funding and those data that are
classified fall within excepted categories. The rights of the
Contractor in data are subject to the disposition of data rights in
the treaties and international agreements identified under this
Contract as well as those additional treaties and international
agreements which DOE may from time to time identify by unilateral
amendment to the Contract; such amendment listing added treaties and
international agreements is effective only for data which is
developed after the date such treaty or international agreement is
added to this Contract. Also, the Contractor will not be permitted
to assert copyright in data in the form of various technical reports
generated by the Contractor under the Contract without first
obtaining the advanced written permission of the contracting
officer.
(2) DOE Review and Response to Contractor's Request. The Patent
Counsel shall use its best efforts to respond in writing within 90
days of receipt of a complete request by the Contractor to assert
copyright in technical data and computer software pursuant to this
clause. Such response shall either give or withhold DOE's permission
for the Contractor to assert copyright or advise the Contractor that
DOE needs additional time to respond, and the reasons therefor.
[[Page 81053]]
(3) Permission for Contractor to Assert Copyright.
(i) For computer software, the Contractor shall furnish to the
DOE designated, centralized software distribution and control point,
the Energy Science and Technology Software Center, at the time
permission to assert copyright is given under paragraph (e)(2) of
this clause: (A) An abstract describing the software suitable for
publication, (B) the source code for each software program, and (C)
the object code and at least the minimum support documentation
needed by a technically competent user to understand and use the
software. The Patent Counsel, for good cause shown by the
Contractor, may allow the minimum support documentation to be
delivered within 60 days after permission to assert copyright is
given or at such time the minimum support documentation becomes
available. The Contractor acknowledges that the DOE designated
software distribution and control point may provide a technical
description of the software in an announcement identifying its
availability from the copyright holder.
(ii) Unless otherwise directed by the contracting officer, for
data other than computer software to which the Contractor has
received permission to assert copyright under paragraph (e)(2) of
this clause above, the Contractor shall within sixty (60) days of
obtaining such permission furnish to DOE's Office of Scientific and
Technical Information (OSTI) a copy of such data as well as an
abstract of the data suitable for dissemination purposes. The
Contractor acknowledges that OSTI may provide an abstract of the
data in an announcement to DOE, its contractors and to the public
identifying its availability from the copyright holder.
(iii) For a five year period or such other specified period as
specifically approved by Patent Counsel beginning on the date the
Contractor is given permission to assert copyright in data, the
Contractor grants to the Government, and others acting on its
behalf, a paid-up, nonexclusive, irrevocable worldwide license in
such copyrighted data to reproduce, prepare derivative works and
perform publicly and display publicly, by or on behalf of the
Government. Upon request, the initial period may be extended after
DOE approval. The DOE approval will be based on the standard that
the work is still commercially available and the market demand is
being met.
(iv) After the period approved by Patent Counsel for application
of the limited Government license described in paragraph (e)(3)(iii)
of this clause, or if, prior to the end of such period(s), the
Contractor abandons commercialization activities pertaining to the
data to which the Contractor has been given permission to assert
copyright, the Contractor grants to the Government, and others
acting on its behalf, a paid-up, nonexclusive, irrevocable worldwide
license in such copyrighted data to reproduce, distribute copies to
the public, prepare derivative works, perform publicly and display
publicly, and to permit others to do so.
(v) Whenever the Contractor asserts copyright in data pursuant
to this paragraph (e), the Contractor shall affix the applicable
copyright notice of 17 U.S.C. 401 or 402 on the copyrighted data and
also an acknowledgment of the Government sponsorship and license
rights of paragraphs (e)(3) (iii) and (iv) of this clause. Such
action shall be taken when the data are delivered to the Government,
published, licensed or deposited for registration as a published
work in the U.S. Copyright Office. The acknowledgment of Government
sponsorship and license rights shall be as follows: Notice: These
data were produced by (insert name of Contractor) under Contract No.
______________ with the Department of Energy. For (period approved
by DOE Patent Counsel) from (date permission to assert copyright was
obtained), the Government is granted for itself and others acting on
its behalf a nonexclusive, paid-up, irrevocable worldwide license in
this data to reproduce, prepare derivative works, and perform
publicly and display publicly, by or on behalf of the Government.
There is provision for the possible extension of the term of this
license. Subsequent to that period or any extension granted, the
Government is granted for itself and others acting on its behalf a
nonexclusive, paid-up, irrevocable worldwide license in this data to
reproduce, prepare derivative works, distribute copies to the
public, perform publicly and display publicly, and to permit others
to do so. The specific term of the license can be identified by
inquiry made to Contractor or DOE. Neither the United States nor the
United States Department of Energy, nor any of their employees,
makes any warranty, express or implied, or assumes any legal
liability or responsibility for the accuracy, completeness, or
usefulness of any data , apparatus, product, or process disclosed,
or represents that its use would not infringe privately owned
rights.
(End of Notice)
(vi) With respect to any data to which the Contractor has
received permission to assert copyright, the DOE has the right,
during the five (5) year or specified longer period approved by
Patent Counsel as provided for in paragraph (e) of this clause, to
request the Contractor to grant a nonexclusive, partially exclusive
or exclusive license in any field of use to a responsible
applicant(s) upon terms that are reasonable under the circumstances,
and if the Contractor refuses such request, to grant such license
itself, if the DOE determines that the Contractor has not made a
satisfactory demonstration that either it or its licensee(s) is
actively pursuing commercialization of the data as set forth in
subparagraph (e)(1)(A) of this clause. Before licensing under this
subparagraph (vi), DOE shall furnish the Contractor a written
request for the Contractor to grant the stated license, and the
Contractor shall be allowed thirty (30) days (or such longer period
as may be authorized by the contracting officer for good cause shown
in writing by the Contractor) after such notice to show cause why
the license should not be granted. The Contractor shall have the
right to appeal the decision of the DOE to grant the stated license
to the Invention Licensing Appeal Board as set forth in 10 CFR
781.65--''Appeals.''
(vii) No costs shall be allowable for maintenance of copyrighted
data, primarily for the benefit of the Contractor and/or a licensee
which exceeds DOE Program needs, except as expressly provided in
writing by the contracting officer. The Contractor may use its net
royalty income to effect such maintenance costs.
(viii) At any time the Contractor abandons commercialization
activities for data for which the Contractor has received permission
to assert copyright in accordance with this clause, it shall advise
OSTI and Patent Counsel and upon request assign the copyright to the
Government so that the Government can distribute the data to the
public.
(4) The following notice may be placed on computer software
prior to any publication and prior to the Contractor's obtaining
permission from the Department of Energy to assert copyright in the
computer software pursuant to paragraph (c)(3) of this section.
Notice: This computer software was prepared by [insert the
Contractor's name and the individual author], hereinafter the
Contractor, under Contract [insert the Contract Number] with the
Department of Energy (DOE). All rights in the computer software are
reserved by DOE on behalf of the United States Government and the
Contractor as provided in the Contract. You are authorized to use
this computer software for Governmental purposes but it is not to be
released or distributed to the public. NEITHER THE GOVERNMENT NOR
THE CONTRACTOR MAKES ANY WARRANTY, EXPRESS OR IMPLIED, OR ASSUMES
ANY LIABILITY FOR THE USE OF THIS SOFTWARE. This notice including
this sentence must appear on any copies of this computer software.
(End of Notice)
(5) a similar notice can be used for data, other than computer
software, upon approval of DOE Patent Counsel.
(f) Subcontracting. (1) Unless otherwise directed by the
contracting officer, the Contractor agrees to use in subcontracts in
which technical data or computer software is expected to be produced
or in subcontracts for supplies that contain a requirement for
production or delivery of data in accordance with the policy and
procedures of 48 CFR Subpart 27.4 as supplemented by 48 CFR 927.401
through 927.409, the clause entitled, ``Rights in Data-General'' at
48 CFR 52.227-14 modified in accordance with 927.409(a) and
including Alternate V. Alternates II through IV of that clause may
be included as appropriate with the prior approval of DOE Patent
Counsel, and the Contractor shall not acquire rights in a
subcontractor's limited rights data or restricted computer software,
except through the use of Alternates II or III, respectively,
without the prior approval of DOE Patent Counsel. The clause at 48
CFR 52.227-16, Additional Data Requirements, shall be included in
subcontracts in accordance with 48 CFR 927.409(h). The Contractor
shall use instead the Rights in Data-Facilities clause at 48 CFR
970.5227-1 in subcontracts, including subcontracts for related
support services, involving the design or operation of any plants or
facilities or specially designed equipment for such plants
[[Page 81054]]
or facilities that are managed or operated under its contract with
DOE.
(2) It is the responsibility of the Contractor to obtain from
its subcontractors technical data and computer software and rights
therein, on behalf of the Government, necessary to fulfill the
Contractor's obligations to the Government with respect to such
data. In the event of refusal by a subcontractor to accept a clause
affording the Government such rights, the Contractor shall:
(i) Promptly submit written notice to the contracting officer
setting forth reasons or the subcontractor's refusal and other
pertinent information which may expedite disposition of the matter,
and
(ii) Not proceed with the subcontract without the written
authorization of the contracting officer.
(3) Neither the Contractor nor higher-tier subcontractors shall
use their power to award subcontracts as economic leverage to
acquire rights in a subcontractor's limited rights data and
restricted computer software for their private use.
(g) Rights in Limited Rights Data. Except as may be otherwise
specified in this Contract as data which are not subject to this
paragraph, the Contractor agrees to and does hereby grant to the
Government an irrevocable nonexclusive, paid-up license by or for
the Government, in any limited rights data of the Contractor
specifically used in the performance of this Contract, provided,
however, that to the extent that any limited rights data when
furnished or delivered is specifically identified by the Contractor
at the time of initial delivery to the Government or a
representative of the Government, such data shall not be used within
or outside the Government except as provided in the ``Limited Rights
Notice'' set forth below. All such limited rights data shall be
marked with the following ``Limited Rights Notice:''
Limited Rights Notice
These data contain ``limited rights data,'' furnished under
Contract No. ______________ with the United States Department of
Energy which may be duplicated and used by the Government with the
express limitations that the ``limited rights data'' may not be
disclosed outside the Government or be used for purposes of
manufacture without prior permission of the Contractor, except that
further disclosure or use may be made solely for the following
purposes:
(a) Use (except for manufacture) by support services contractors
within the scope of their contracts;
(b) This ``limited rights data'' may be disclosed for evaluation
purposes under the restriction that the ``limited rights data'' be
retained in confidence and not be further disclosed;
(c) This ``limited rights data'' may be disclosed to other
contractors participating in the Government's program of which this
Contract is a part for information or use (except for manufacture)
in connection with the work performed under their contracts and
under the restriction that the ``limited rights data'' be retained
in confidence and not be further disclosed;
(d) This ``limited rights data'' may be used by the Government
or others on its behalf for emergency repair or overhaul work under
the restriction that the ``limited rights data'' be retained in
confidence and not be further disclosed; and
(e) Release to a foreign government, or instrumentality thereof,
as the interests of the United States Government may require, for
information or evaluation, or for emergency repair or overhaul work
by such government.
This Notice shall be marked on any reproduction of this data in
whole or in part.
(End of Notice)
(h) Rights in Restricted Computer Software. (1) Except as may be
otherwise specified in this Contract as data which are not subject
to this paragraph, the Contractor agrees to and does hereby grant to
the Government an irrevocable, nonexclusive, paid-up, license by or
for the Government, in any restricted computer software of the
Contractor specifically used in the performance of this Contract;
provided, however, that to the extent that any restricted computer
software when furnished or delivered is specifically identified by
the Contractor at the time of initial delivery to the Government or
a representative of the Government, such data shall not be used
within or outside the Government except as provided in the
``Restricted Rights Notice'' set forth below. All such restricted
computer software shall be marked with the following ``Restricted
Rights Notice:''
Restricted Rights Notice--Long Form
(a) This computer software is submitted with restricted rights
under Department of Energy Contract No. ______. It may not be used,
reproduced, or disclosed by the Government except as provided in
paragraph (b) of this notice.
(b) This computer software may be:
(1) Used or copied for use in or with the computer or computers
for which it was acquired, including use at any Government
installation to which such computer or computers may be transferred;
(2) Used, copied for use, in a backup or replacement computer if
any computer for which it was acquired is inoperative or is
replaced;
(3) Reproduced for safekeeping (archives) or backup purposes;
(4) Modified, adapted, or combined with other computer software,
provided that only the portions of the derivative software
consisting of the restricted computer software are to be made
subject to the same restricted rights; and
(5) Disclosed to and reproduced for use by contractors under a
service contract (of the type defined in 48 CFR 37.101) in
accordance with subparagraphs (b)(1) through (4) of this Notice,
provided the Government makes such disclosure or reproduction
subject to these restricted rights.
(c) Notwithstanding the foregoing, if this computer software has
been published under copyright, it is licensed to the Government,
without disclosure prohibitions, with the rights set forth in the
restricted rights notice above.
(d) This Notice shall be marked on any reproduction of this
computer software, in whole or in part.
(End of Notice)
(2) Where it is impractical to include the Restricted Rights
Notice on restricted computer software, the following short-form
Notice may be used in lieu thereof:
Restricted Rights Notice--Short Form
Use, reproduction, or disclosure is subject to restrictions set
forth in the Long Form Notice of DOE Contract No. ______ with (name
of Contractor).
(End of Notice)
(3) If the software is embedded, or if it is commercially
impractical to mark it with human readable text, then the symbol R
and the clause date (mo/yr) in brackets or a box, a [R-mo/yr], may
be used. This will be read to mean restricted computer software,
subject to the rights of the Government as described in the Long
Form Notice, in effect as of the date indicated next to the symbol.
The symbol shall not be used to mark human readable material. In the
event this Contract contains any variation to the rights in the Long
Form Notice, then the contract number must also be cited.
(4) If restricted computer software is delivered with the
copyright notice of 17 U.S.C. 401, the software will be presumed to
be published copyrighted computer software licensed to the
Government without disclosure prohibitions and with unlimited
rights, unless the Contractor includes the following statement with
such copyright notice ``Unpublished-rights reserved under the
Copyright Laws of the United States.''
(i) Relationship to patents. Nothing contained in this clause
creates or is intended to imply a license to the Government in any
patent or is intended to be construed as affecting the scope of any
licenses or other rights otherwise granted to the Government under
any patent.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.2704-3(b),
where access to Category C-24 restricted data is contemplated in the
performance of a contract the contracting officer shall insert the
phrase ``and except Restricted Data in category C-24, 10 CFR part
725, in which DOE has reserved the right to receive reasonable
compensation for the use of its inventions and discoveries,
including related data and technology'' after ``laser isotope
separation'' and before the comma in paragraph (b)(2)(ii) of the
clause at 48 CFR 970.5227-2, Rights in Data--Technology Transfer, as
appropriate.
(End of Clause)
970.5227-3 Technology transfer mission.
As prescribed in 48 CFR 970.2770-4(a), insert the following clause:
Technology Transfer Mission (DEC 2000)
This clause has as its purpose implementation of the National
Competitiveness Technology Transfer Act of 1989 (Sections 3131,
3132, 3133, and 3157 of Pub. L. 101-189 and as amended by Pub. L.
103-160, Sections 3134 and 3160). The Contractor shall conduct
technology transfer activities with a purpose of providing benefit
from Federal research to U.S. industrial competitiveness.
[[Page 81055]]
(a) Authority. (1) In order to ensure the full use of the
results of research and development efforts of, and the capabilities
of, the Laboratory, technology transfer, including Cooperative
Research and Development Agreements (CRADAs), is established as a
mission of the Laboratory consistent with the policy, principles and
purposes of Sections 11(a)(1) and 12(g) of the Stevenson-Wydler
Technology Innovation Act of 1980, as amended (15 U.S.C. 3710a);
Section 3132(b) of Pub. L. 101-189, Sections 3134 and 3160 of Pub.
L. 103-160, and of Chapter 38 of the Patent Laws (35 U.S.C. 200 et
seq.); Section 152 of the Atomic Energy Act of 1954, as amended (42
U.S.C. 2182); Section 9 of the Federal Nonnuclear Energy Research
and Development Act of 1974 (42 U.S.C. 5908); and Executive Order
12591 of April 10, 1987.
(2) In pursuing the technology transfer mission, the Contractor
is authorized to conduct activities including but not limited to:
identifying and protecting Intellectual Property made, created or
acquired at or by the Laboratory; negotiating licensing agreements
and assignments for Intellectual Property made, created or acquired
at or by the Laboratory that the Contractor controls or owns;
bailments; negotiating all aspects of and entering into CRADAs;
providing technical consulting and personnel exchanges; conducting
science education activities and reimbursable Work for Others (WFO);
providing information exchanges; and making available laboratory or
weapon production user facilities. It is fully expected that the
Contractor shall use all of the mechanisms available to it to
accomplish this technology transfer mission, including, but not
limited to, CRADAs, user facilities, WFO, science education
activities, consulting, personnel, assignments, and licensing in
accordance with this clause.
(b) Definitions. (1) Contractor's Laboratory Director means the
individual who has supervision over all or substantially all of the
Contractor's operations at the Laboratory.
(2) Intellectual Property means patents, trademarks, copyrights,
mask works, protected CRADA information, and other forms of
comparable property rights protected by Federal Law and other
foreign counterparts.
(3) Cooperative Research and Development Agreement (CRADA) means
any agreement entered into between the Contractor as operator of the
Laboratory, and one or more parties including at least one non-
Federal party under which the Government, through its laboratory,
provides personnel, services, facilities, equipment, intellectual
property, or other resources with or without reimbursement (but not
funds to non-Federal parties) and the non-Federal parties provide
funds, personnel, services, facilities, equipment, intellectual
property, or other resources toward the conduct of specified
research or development efforts which are consistent with the
missions of the Laboratory; except that such term does not include a
procurement contract, grant, or cooperative agreement as those terms
are used in sections 6303, 6304, and 6305 of Title 31 of the United
States Code.
(4) Joint Work Statement (JWS) means a proposal for a CRADA
prepared by the Contractor, signed by the Contractor's Laboratory
Director or designee which describes the following:
(i) Purpose;
(ii) Scope of Work which delineates the rights and
responsibilities of the Government, the Contractor and Third
Parties, one of which must be a non-Federal party;
(iii) Schedule for the work; and
(iv) Cost and resource contributions of the parties associated
with the work and the schedule.
(5) Assignment means any agreement by which the Contractor
transfers ownership of Laboratory Intellectual Property, subject to
the Government's retained rights.
(6) Laboratory Biological Materials means biological materials
capable of replication or reproduction, such as plasmids,
deoxyribonucleic acid molecules, ribonucleic acid molecules, living
organisms of any sort and their progeny, including viruses,
prokaryote and eukaryote cell lines, transgenic plants and animals,
and any derivatives or modifications thereof or products produced
through their use or associated biological products, made under this
contract by Laboratory employees or through the use of Laboratory
research facilities.
(7) Laboratory Tangible Research Product means tangible material
results of research which
(i) are provided to permit replication, reproduction, evaluation
or confirmation of the research effort, or to evaluate its potential
commercial utility;
(ii) are not materials generally commercially available; and
(iii) were made under this contract by Laboratory employees or
through the use of Laboratory research facilities.
(8) Bailment means any agreement in which the Contractor permits
the commercial or non-commercial transfer of custody, access or use
of Laboratory Biological Materials or Laboratory Tangible Research
Product for a specified purpose of technology transfer or research
and development, including without limitation evaluation, and
without transferring ownership to the bailee.
(c) Allowable Costs. (1) The Contractor shall establish and
carry out its technology transfer efforts through appropriate
organizational elements consistent with the requirements for an
Office of Research and Technology Applications (ORTA) pursuant to
paragraphs (b) and (c) of Section 11 of the Stevenson-Wydler
Technology Innovation Act of 1980, as amended (15 U.S.C. 3710). The
costs associated with the conduct of technology transfer through the
ORTA including activities associated with obtaining, maintaining,
licensing, and assigning Intellectual Property rights, increasing
the potential for the transfer of technology, and the widespread
notice of technology transfer opportunities, shall be deemed
allowable provided that such costs meet the other requirements of
the allowable costs provisions of this Contract. In addition to any
separately designated funds, these costs in any fiscal year shall
not exceed an amount equal to 0.5 percent of the operating funds
included in the Federal research and development budget (including
Work For Others) of the Laboratory for that fiscal year without
written approval of the contracting officer.
(2) The Contractor's participation in litigation to enforce or
defend Intellectual Property claims incurred in its technology
transfer efforts shall be as provided in the clause entitled
``Insurance--Litigation and Claims'' of this contract.
(d) Conflicts of Interest--Technology Transfer. The Contractor
shall have implementing procedures that seek to avoid employee and
organizational conflicts of interest, or the appearance of conflicts
of interest, in the conduct of its technology transfer activities.
These procedures shall apply to other persons participating in
Laboratory research or related technology transfer activities. Such
implementing procedures shall be provided to the contracting officer
for review and approval within sixty (60) days after execution of
this contract. The contracting officer shall have thirty (30) days
thereafter to approve or require specific changes to such
procedures. Such implementing procedures shall include procedures
to:
(1) Inform employees of and require conformance with standards
of conduct and integrity in connection with the CRADA activity in
accordance with the provisions of paragraph (n)(5) of this clause;
(2) Review and approve employee activities so as to avoid
conflicts of interest arising from commercial utilization activities
relating to Contractor-developed Intellectual Property;
(3) Conduct work performed using royalties so as to avoid
interference with or adverse effects on ongoing DOE projects and
programs;
(4) Conduct activities relating to commercial utilization of
Contractor-developed Intellectual Property so as to avoid
interference with or adverse effects on user facility or WFO
activities of the Contractor;
(5) Conduct DOE-funded projects and programs so as to avoid the
appearance of conflicts of interest or actual conflicts of interest
with non-Government funded work;
(6) Notify the contracting officer with respect to any new work
to be performed or proposed to be performed under the Contract for
DOE or other Federal agencies where the new work or proposal
involves Intellectual Property in which the Contractor has obtained
or intends to request or elect title;
(7) Except as provided elsewhere in this Contract, obtain the
approval of the contracting officer for any licensing of or
assignment of title to Intellectual Property rights by the
Contractor to any business or corporate affiliate of the Contractor;
(8) Obtain the approval of the contracting officer prior to any
assignment, exclusive licensing, or option for exclusive licensing,
of Intellectual Property to any individual who has been a Laboratory
employee within the previous two years or to the company in which
the individual is a principal; and
(9) Notify non-Federal sponsors of WFO activities, or non-
Federal users of user facilities, of any relevant Intellectual
Property interest of the Contractor prior to execution of WFOs or
user agreements.
[[Page 81056]]
(10) Notify DOE prior to evaluating a proposal by a third party
or DOE, when the subject matter of the proposal involves an elected
or waived subject invention under this contract or one in which the
Contractor intends to elect to retain title under this contract.
(e) Fairness of Opportunity. In conducting its technology
transfer activities, the Contractor shall prepare procedures and
take all reasonable measures to ensure widespread notice of
availability of technologies suited for transfer and opportunities
for exclusive licensing and joint research arrangements. The
requirement to widely disseminate the availability of technology
transfer opportunities does not apply to a specific application
originated outside of the Laboratory and by entities other than the
Contractor.
(f) U.S. Industrial Competitiveness. (1) In the interest of
enhancing U.S. Industrial Competitiveness, the Contractor shall, in
its licensing and assignments of Intellectual Property, give
preference in such a manner as to enhance the accrual of economic
and technological benefits to the U.S. domestic economy. The
Contractor shall consider the following factors in all of its
licensing and assignment decisions involving Laboratory intellectual
property where the Laboratory obtains rights during the course of
the Contractor's operation of the Laboratory under this contract:
(i) whether any resulting design and development will be
performed in the United States and whether resulting products,
embodying parts, including components thereof, will be substantially
manufactured in the United States; or
(ii) (A) whether the proposed licensee or assignee has a
business unit located in the United States and whether significant
economic and technical benefits will flow to the United States as a
result of the license or assignment agreement; and
(B) in licensing any entity subject to the control of a foreign
company or government, whether such foreign government permits
United States agencies, organizations or other persons to enter into
cooperative research and development agreements and licensing
agreements, and has policies to protect United States Intellectual
Property rights.
(2) If the Contractor determines that neither of the conditions
in paragraphs (f)(1)(i) or (ii) of this clause are likely to be
fulfilled, the Contractor, prior to entering into such an agreement,
must obtain the approval of the contracting officer. The contracting
officer shall act on any such requests for approval within thirty
(30) days.
(3) The Contractor agrees to be bound by the provisions of 35
U.S.C. 204 (Preference for United States industry).
(g) Indemnity--Product Liability. In entering into written
technology transfer agreements, including but not limited to,
research and development agreements, licenses, assignments and
CRADAs, the Contractor agrees to include in such agreements a
requirement that the U.S. Government and the Contractor, except for
any negligent acts or omissions of the Contractor, be indemnified
for all damages, costs, and expenses, including attorneys' fees,
arising from personal injury or property damage occurring as a
result of the making, using or selling of a product, process or
service by or on behalf of the Participant, its assignees or
licensees which was derived from the work performed under the
agreement. The Contractor shall identify and obtain the approval of
the contracting officer for any proposed exceptions to this
requirement such as where State or local law expressly prohibit the
Participant from providing indemnification or where the research
results will be placed in the public domain.
(h) Disposition of Income. (1) Royalties or other income earned
or retained by the Contractor as a result of performance of
authorized technology transfer activities herein shall be used by
the Contractor for scientific research, development, technology
transfer, and education at the Laboratory, consistent with the
research and development mission and objectives of the Laboratory
and subject to Section 12(b)(5) of the Stevenson-Wydler Technology
Innovation Act of 1980, as amended (15 U.S.C. 3710a(b)(5)) and
Chapter 38 of the Patent Laws (35 U.S.C. 200 et seq.) as amended
through the effective date of this contract award or modification.
If the net amounts of such royalties and income received from patent
licensing after payment of patenting costs, licensing costs,
payments to inventors and other expenses incidental to the
administration of Subject Inventions during any fiscal year exceed 5
percent of the Laboratory's budget for that fiscal year, 75 percent
of such excess amounts shall be paid to the Treasury of the United
States, and the remaining amount of such excess shall be used by the
Contractor for the purposes as described above in this paragraph.
Any inventions arising out of such scientific research and
development activities shall be deemed to be Subject Inventions
under the Contract.
(2) The Contractor shall include as a part of its annual
Laboratory Institutional Plan or other such annual document a plan
setting out those uses to which royalties and other income received
as a result of performance of authorized technology transfer
activities herein will be applied at the Laboratory, and at the end
of the year, provide a separate accounting for how the funds were
actually used. Under no circumstances shall these royalties and
income be used for an illegal augmentation of funds furnished by the
U.S. Government.
(3) The Contractor shall establish subject to the approval of
the contracting officer a policy for making awards or sharing of
royalties with Contractor employees, other coinventors and
coauthors, including Federal employee coinventors when deemed
appropriate by the contracting officer.
(i) Transfer to Successor Contractor. In the event of
termination or upon the expiration of this Contract, any unexpended
balance of income received for use at the Laboratory shall be
transferred, at the contracting officer's request, to a successor
contractor, or in the absence of a successor contractor, to such
other entity as designated by the contracting officer. The
Contractor shall transfer title, as one package, to the extent the
Contractor retains title, in all patents and patent applications,
licenses, accounts containing royalty revenues from such license
agreements, including equity positions in third party entities, and
other Intellectual Property rights which arose at the Laboratory, to
the successor contractor or to the Government as directed by the
contracting officer.
(j) Technology Transfer Affecting the National Security. (1) The
Contractor shall notify and obtain the approval of the contracting
officer, prior to entering into any technology transfer arrangement,
when such technology or any part of such technology is classified or
sensitive under Section 148 of the Atomic Energy Act (42 U.S.C.
2168). Such notification shall include sufficient information to
enable DOE to determine the extent that commercialization of such
technology would enhance or diminish security interests of the
United States, or diminish communications within DOE's nuclear
weapon production complex. DOE shall use its best efforts to
complete its determination within sixty (60) days of the
Contractor's notification, and provision of any supporting
information, and DOE shall promptly notify the Contractor as to
whether the technology is transferable.
(2) The Contractor shall include in all of its technology
transfer agreements with third parties, including, but not limited
to, CRADAs, licensing agreements and assignments, notice to such
third parties that the export of goods and/or Technical Data from
the United States may require some form of export control license or
other authority from the U.S. Government and that failure to obtain
such export control license may result in criminal liability under
U.S. laws.
(3) For other than fundamental research as defined in National
Security Decision Directive 189, the Contractor is responsible to
conduct internal export control reviews and assure that technology
is transferred in accordance with applicable law.
(k) Records. The Contractor shall maintain records of its
technology transfer activities in a manner and to the extent
satisfactory to the DOE and specifically including, but not limited
to, the licensing agreements, assignments and the records required
to implement the requirements of paragraphs (e), (f), and (h) of
this clause and shall provide reports to the contracting officer to
enable DOE to maintain the reporting requirements of Section
12(c)(6) of the Stevenson-Wydler Technology Innovation Act of 1980,
as amended (15 U.S.C. 3710a(c)(6)). Such reports shall be made
annually in a format to be agreed upon between the Contractor and
DOE and in such a format which will serve to adequately inform DOE
of the Contractor's technology transfer activities while protecting
any data not subject to disclosure under the Rights in Technical
Data clause and paragraph (n) of this clause. Such records shall be
made available in accordance with the clauses of this Contract
pertaining to inspection, audit and examination of records.
(l) Reports to Congress. To facilitate DOE's reporting to
Congress, the Contractor is required to submit annually to DOE a
[[Page 81057]]
technology transfer plan for conducting its technology transfer
function for the upcoming year, including plans for securing
Intellectual Property rights in Laboratory innovations with
commercial promise and plans for managing such innovations so as to
benefit the competitiveness of United States industry. This plan
shall be provided to the contracting officer on or before October
1st of each year.
(m) Oversight and Appraisal. The Contractor is responsible for
developing and implementing effective internal controls for all
technology transfer activities consistent with the audit and record
requirements of this Contract. Laboratory Contractor performance in
implementing the technology transfer mission and the effectiveness
of the Contractor's procedures will be evaluated by the contracting
officer as part of the annual appraisal process, with input from the
cognizant Secretarial Officer or program office.
(n) Technology Transfer Through Cooperative Research and
Development Agreements. Upon approval of the contracting officer and
as provided in a DOE approved Joint Work Statement (JWS), the
Laboratory Director, or designee, may enter into CRADAs on behalf of
the DOE subject to the requirements set forth in this paragraph.
(1) Review and Approval of CRADAs. (i) Except as otherwise
directed in writing by the contracting officer, each JWS shall be
submitted to the contracting officer for approval. The Contractor's
Laboratory Director or designee shall provide a program mission
impact statement and shall include an impact statement regarding
related Intellectual Property rights known by the Contractor to be
owned by the Government to assist the contracting officer in the
approval determination.
(ii) The Contractor shall also include (specific to the proposed
CRADA), a statement of compliance with the Fairness of Opportunity
requirements of paragraph (e) of this clause.
(iii) Within ninety (90) days after submission of a JWS, the
contracting officer shall approve, disapprove or request
modification to the JWS. If a modification is required, the
contracting officer shall approve or disapprove any resubmission of
the JWS within thirty (30) days of its resubmission, or ninety (90)
days from the date of the original submission, whichever is later.
The contracting officer shall provide a written explanation to the
Contractor's Laboratory Director or designee of any disapproval or
requirement for modification of a JWS.
(iv) Upon approval of a JWS, the Contractor's Laboratory
Director or designee may submit a CRADA, based upon the approved
JWS, to the contracting officer. The contracting officer, within
thirty (30) days of receipt of the CRADA, shall approve or request
modification of the CRADA. If the contracting officer requests a
modification of the CRADA, an explanation of such request shall be
provided to the Laboratory Director or designee.
(v) Except as otherwise directed in writing by the contracting
officer, the Contractor shall not enter into, or begin work under, a
CRADA until approval of the CRADA has been granted by the
contracting officer. The Contractor may submit its proposed CRADA to
the contracting officer at the time of submitting its proposed JWS
or any time thereafter. However, the contracting officer is not
obligated to respond under paragraph (n)(1)(iv) of this clause until
within thirty (30) days after approval of the JWS or thirty (30)
days after submittal of the CRADA, whichever is later.
(2) Selection of Participants. The Contractor's Laboratory
Director or designee in deciding what CRADA to enter into shall:
(i) Give special consideration to small business firms, and
consortia involving small business firms;
(ii) Give preference to business units located in the United
States which agree that products or processes embodying Intellectual
Property will be substantially manufactured or practiced in the
United States and, in the case of any industrial organization or
other person subject to the control of a foreign company or
government, take into consideration whether or not such foreign
government permits United States agencies, organizations, or other
persons to enter into cooperative research and development
agreements and licensing agreements;
(iii) Provide Fairness of Opportunity in accordance with the
requirements of paragraph (e) of this clause; and
(iv) Give consideration to the Conflicts of Interest
requirements of paragraph (d) of this clause.
(3) Withholding of Data. (i) Data that is first produced as a
result of research and development activities conducted under a
CRADA and that would be a trade secret or commercial or financial
data that would be privileged or confidential, if such data had been
obtained from a non-Federal third party, may be protected from
disclosure under the Freedom of Information Act as provided in the
Stevenson-Wydler Technology Innovation Act of 1980, as amended (15
U.S.C. 3710a(c)(7)) for a period as agreed in the CRADA of up to
five (5)years from the time the data is first produced. The DOE
shall cooperate with the Contractor in protecting such data.
(ii) Unless otherwise expressly approved by the contracting
officer in advance for a specific CRADA, the Contractor agrees, at
the request of the contracting officer, to transmit such data to
other DOE facilities for use by DOE or its Contractors by or on
behalf of the Government. When data protected pursuant to paragraph
(n)(3)(i) of this clause is so transferred, the Contractor shall
clearly mark the data with a legend setting out the restrictions
against private use and further dissemination, along with the
expiration date of such restrictions.
(iii) In addition to its authority to license Intellectual
Property, the Contractor may enter into licensing agreements with
third parties for data developed by the Contractor under a CRADA
subject to other provisions of this Contract. However, the
Contractor shall neither use the protection against dissemination
nor the licensing of data as an alternative to the submittal of
invention disclosures which include data protected pursuant to
paragraph (n)(3)(i) of this clause.
(4) Work For Others and User Facility Programs. (i) WFO and User
Facility Agreements (UFAs) are not CRADAs and will be available for
use by the Contractor in addition to CRADAs for achieving
utilization of employee expertise and unique facilities for
maximizing technology transfer. The Contractor agrees form
prospective CRADA participants, which are intending to substantially
pay full cost recovery for the effort under a proposed CRADA, of the
availability of alternative forms of agreements, i.e., WFO and UFA,
and of the Class Patent Waiver provisions associated therewith.
(ii) Where the Contractor believes that the transfer of
technology to the U.S. domestic economy will benefit from, or other
equity considerations dictate, an arrangement other than the Class
Waiver of patent rights to the sponsor in WFO and UFAs, a request
may be made to the contracting officer for an exception to the Class
Waivers.
(iii) Rights to inventions made under agreements other than
funding agreements with third parties shall be governed by the
appropriate provisions incorporated, with DOE approval, in such
agreements, and the provisions in such agreements take precedence
over any disposition of rights contained in this Contract.
Disposition of rights under any such agreement shall be in
accordance with any DOE class waiver (including Work for Others and
User Class Waivers) or individually negotiated waiver which applies
to the agreement.
(5) Conflicts of Interest. (i) Except as provided in paragraph
(n)(5)(iii) of this clause, the Contractor shall assure that no
employee of the Contractor shall have a substantial role (including
an advisory role) in the preparation, negotiation, or approval of a
CRADA, if, to such employee's knowledge:
(A) Such employee, or the spouse, child, parent, sibling, or
partner of such employee, or an organization (other than the
Contractor) in which such employee serves as an officer, director,
trustee, partner, or employee--
(1) holds financial interest in any entity, other than the
Contractor, that has a substantial interest in the preparation,
negotiation, or approval of the CRADA;
(2) receives a gift or gratuity from any entity, other than the
Contractor, that has a substantial interest in the preparation,
negotiation, or approval of the CRADA; or
(B) A financial interest in any entity, other than the
Contractor, that has a substantial interest in the preparation,
negotiation, or approval of the CRADA, is held by any person or
organization with whom such employee is negotiating or has any
arrangement concerning prospective employment.
(ii) The Contractor shall require that each employee of the
Contractor who has a substantial role (including an advisory role)
in the preparation, negotiation, or approval of a CRADA certify
through the Contractor to the contracting officer that the
circumstances described in paragraph (n)(5)(i) of this clause do not
apply to that employee.
(iii) The requirements of paragraphs (n)(5)(i) and (n)(5)(ii) of
this clause shall not apply in a case where the contracting officer
is advised by the Contractor in advance of the
[[Page 81058]]
participation of an employee described in those paragraphs in the
preparation, negotiation or approval of a CRADA of the nature of and
extent of any financial interest described in paragraph (n)(5)(i) of
this clause, and the contracting officer determines that such
financial interest is not so substantial as to be considered likely
to affect the integrity of the Contractor employee's participation
in the process of preparing, negotiating, or approving the CRADA.
(o) Technology Transfer in Other Cost-Sharing Agreements. In
conducting research and development activities in cost-shared
agreements not covered by paragraph (n) of this clause, the
Contractor, with prior written permission of the contracting
officer, may provide for the withholding of data produced thereunder
in accordance with the applicable provisions of paragraph (n)(3) of
this clause.
(End of clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.2770-4(b),
add the following definition under paragraph (b) and the following
new paragraph (p):
(b)(8) Privately funded technology transfer means the
prosecuting, maintaining, licensing, and marketing of inventions
which are not owned by the Government (and not related to CRADAs)
when such activities are conducted entirely without the use of
Government funds.
(p) Nothing in paragraphs (c) Allowable Costs, (e) Fairness of
Opportunity, (f) U.S. Industrial Competitiveness, (g) Indemnity--
Product Liability, (h) Disposition of Income, and (i) Transfer to
Successor Contractor of this clause are intended to apply to the
contractor's privately funded technology transfer activities if such
privately funded activities are addressed elsewhere in the contract.
Alternate II (DEC 2000). As prescribed in 48 CFR 970.2770-4(c),
the contracting officer shall substitute the phrase ``weapon
production facility'' wherever the word ``laboratory'' appears in
the clause.
970.5227-4 Authorization and consent.
Insert the following clause in solicitations and contracts in
accordance with 970.2702-1:
Authorization and Consent (DEC 2000)
(a) The Government authorizes and consents to all use and
manufacture of any invention described in and covered by a United
States patent in the performance of this contract or any subcontract
at any tier.
(b) If the Contractor is sued for copyright infringement or
anticipates the filing of such a lawsuit, the Contractor may request
authorization and consent to copy a copyrighted work from the
contracting officer. Programmatic necessity is a major consideration
for DOE in determining whether to grant such request.
(c) The Contractor agrees to include, and require inclusion of,
the Authorization and Consent clause at 52.227-1, without Alternate
1, but suitably modified to identify the parties, in all
subcontracts at any tier for supplies or services (including
construction, architect-engineer services, and materials, supplies,
models, samples, and design or testing services expected to exceed
$25,000).
(d) The Contractor agrees to include, and require inclusion of,
paragraph (a) of this Authorization and Consent clause, suitably
modified to identify the parties, in all subcontracts at any tier
for research and development activities. Omission of an
authorization and consent clause from any subcontract, including
those valued less than $25,000 does not affect this authorization
and consent.
(End of clause)
970.5227-5 Notice and assistance regarding patent and copyright
infringement.
Insert the following clause in solicitations and contracts in
accordance with 970.2702-2:
Notice and Assistance Regarding Patent and Copyright Infringement (DEC
2000)
(a) The Contractor shall report to the Contracting Officer
promptly and in reasonable written detail, each notice or claim of
patent or copyright infringement based on the performance of this
contract of which the Contractor has knowledge.
(b) If any person files a claim or suit against the Government
on account of any alleged patent or copyright infringement arising
out of the performance of this contract or out of the use of any
supplies furnished or work or services performed hereunder, the
Contractor shall furnish to the Government, when requested by the
Contracting Officer, all evidence and information in possession of
the Contractor pertaining to such suit or claim. Except where the
Contractor has agreed to indemnify the Government, the Contractor
shall furnish such evidence and information at the expense of the
Government.
(c) The Contractor agrees to include, and require inclusion of,
this clause suitably modified to identify the parties, in all
subcontracts at any tier expected to exceed $25,000.
(End of clause)
970.5227-6 Patent indemnity--subcontracts.
Insert the following clause in solicitations and contracts in
accordance with 970.2702-3:
Patent Indemnity--Subcontracts (DEC 2000)
Except as otherwise authorized by the Contracting Officer, the
Contractor shall obtain indemnification of the Government and its
officers, agents, and employees against liability, including costs,
for infringement of any United States patent (except a patent issued
upon an application that is now or may hereafter be withheld from
issue pursuant to a secrecy order by the Government) from
Contractor's subcontractors for any contract work subcontracted in
accordance with FAR 48 CFR 52.227-3.
(End of clause)
970.5227-7 Royalty information.
Insert the following provision in solicitations in accordance with
970.2702-4:
Royalty Information (DEC 2000)
(a) Cost or charges for royalties. If the response to this
solicitation contains costs or charges for royalties totaling more
than $250, the following information shall be included in the
response relating to each separate item of royalty or license fee:
(1) Name and address of licensor;
(2) Date of license agreement;
(3) Patent numbers, patent application serial numbers, or other
basis on which the royalty is payable;
(4) Brief description, including any part or model numbers of
each contract item or component on which the royalty is payable;
(5) Percentage or dollar rate of royalty per unit;
(6) Unit price of contract item;
(7) Number of units; and
(8) Total dollar amount of royalties.
(b) Copies of current licenses. In addition, if specifically
requested by the Contracting Officer before execution of the
contract, the offeror shall furnish a copy of the current license
agreement and an identification of applicable claims of specific
patents or other basis upon which the royalty may be payable.
(End of provision)
970.5227-8 Refund of royalties.
Insert the following clause in solicitations and contracts in
accordance with 970.2702-4:
Refund of Royalties (DEC 2000)
(a) The contract price includes certain amounts for royalties,
payable by the Contractor or subcontractors or both, reported to the
Contracting Officer in accordance with the Royalty Information
provision of the solicitation.
(b) During performance of this contract, if any additional
royalty payments are proposed to be charged to the Government as
costs under the contract that were not included in the original
contract price, the Contractor agrees to submit for approval of the
Contracting Officer prior to the execution of any licensing
agreement the following information relating to each separate item
of royalty or license fee:
(1) Name and address of licensor;
(2) Date of license agreement;
(3) Patent numbers, patent application serial numbers, or other
basis on which the royalty is payable;
(4) Brief description, including any part or model numbers of
each contract item or component on which the royalty is payable;
(5) Percentage or dollar rate of royalty per unit;
(6) Unit price of contract item;
(7) Number of units; and
(8) Total dollar amount of royalties.
(9) In addition, if specifically requested by the Contracting
Officer, the contractor shall furnish a copy of the current license
agreement and an identification of applicable claims of specific
patents.
(c) The term ``royalties'' as used in this clause refers to any
costs or charges in the nature of royalties, license fees, patent or
license amortization costs, or the like, for the use of or for
rights in patents and patent applications in connection with
performing this contract or any subcontract hereunder.
[[Page 81059]]
The term also includes any costs or charges associated with the
access to, use of, or other right pertaining to data that is
represented to be proprietary and is related to the performance of
this contract or subcontracts, or the copying of such data or data
that is copyrighted.
(d) The Contractor shall furnish to the Contracting Officer,
before final payment under this contract, a statement of royalties
paid or required to be paid in connection with performing this
contract and subcontracts hereunder.
(e) The Contractor is compensated for any royalties reported
under paragraph (b) of this clause only to the extent that such
royalties were included in the contract price and are determined by
the Contracting Officer to be properly chargeable to the Government
and allocable to the contract.
(f) The Contracting Officer shall reduce the contract price to
the extent any royalties that are included in the contract price are
not, in fact, paid by the Contractor or are determined by the
Contracting Officer not to be properly chargeable to the Government
and allocable to the contract. The Contractor agrees to repay or
credit the Government accordingly, as the Contracting Officer
directs. Regardless of prior DOE approval of any individual payments
or royalties, DOE may contest at any time the enforceability,
validity, scope of, or title to, a patent or the proprietary nature
of data pursuant to which DOE makes a royalty or other payment.
(g) If at any time within 3 years after final payment under this
contract, the Contractor for any reason is relieved in whole or in
part from the payment of the royalties included in the final
contract price as adjusted pursuant to paragraph (f) of this clause,
the Contractor shall promptly notify the Contracting Office of that
fact and shall promptly reimburse the Government in a corresponding
amount.
(h) The Contractor agrees to include, and require inclusion of,
this clause, including this paragraph (h), suitably modified to
identify the parties in any subcontract at any tier in which the
amount of royalties reported during negotiation of the subcontract
exceeds $250.
(End of clause)
970.5227-9 Notice of right to request patent waiver.
Insert the following provision in solicitations in accordance with
970.2704-6:
Notice of Right to Request Patent Waiver (DEC 2000)
Offerors have the right to request a waiver of all or any part
of the rights of the United States in inventions conceived or first
actually reduced to practice in performance of the contract, in
advance of or within 30 days after the effective date of
contracting. If such advance waiver is not requested or the request
is denied, the Contractor has a continuing right under the contract
to request a waiver of the rights of the Government in identified
inventions, i.e., individual inventions conceived or first actually
reduced to practice in performance of the contract. Contractors that
are domestic small businesses and domestic nonprofit organizations
may not need a waiver and will have included in their contracts a
patent clause reflecting their right to elect title to subject
inventions pursuant to the Bayh-Dole Act (35 U.S.C. 200 et seq.).
(End of provision)
970.5227-10 Patent rights--management and operating contracts,
nonprofit organization or small business firm contractor.
As prescribed in 970.2703-1(b)(2), insert the following clause:
Patent Rights-Management and Operating Contracts, Nonprofit
Organization or Small Business Firm Contractor (DEC 2000)
(a) Definitions.
(1) DOE licensing regulations means the Department of Energy
patent licensing regulations at 10 CFR Part 781.
(2) Exceptional circumstance subject invention means any subject
invention in a technical field or related to a task determined by
the Department of Energy to be subject to an exceptional
circumstance under 35 U.S.C. 202(a)(ii) and in accordance with 37
CFR 401.3(e).
(3) Invention means any invention or discovery which is or may
be patentable or otherwise protectable under Title 35 of the United
States Code, or any novel variety of plant which is or may be
protected under the Plant Variety Protection Act (7 U.S.C. 2321 et
seq.).
(4) Made when used in relation to any invention means the
conception or first actual reduction to practice of such invention.
(5) Nonprofit organization means a university or other
institution of higher education or an organization of the type
described in section 501(c)(3) of the Internal Revenue Code of 1954
(26 U.S.C. 501(c)) and exempt from taxation under section 501(a) of
the Internal Revenue Code (26 U.S.C. 501(a)) or any nonprofit
scientific or educational organization qualified under a state
nonprofit organization statute.
(6) Patent Counsel means the Department of Energy (DOE) Patent
Counsel assisting the DOE contracting activity.
(7) Practical application means to manufacture, in the case of a
composition or product; to practice, in the case of a process or
method; or to operate, in the case of a machine or system; and, in
each case, under such conditions as to establish that the invention
is being utilized and that its benefits are, to the extent permitted
by law or Government regulations, available to the public on
reasonable terms.
(8) Small business firm means a small business concern as
defined at section 2 of Pub. L. 85-536 (15 U.S.C. 632) and
implementing regulations of the Administrator of the Small Business
Administration. For the purpose of this clause, the size standards
for small business concerns involved in Government procurement and
subcontracting at 13 CFR 121.3-8 and 13 CFR 121.3-12, respectively,
are used.
(9) Subject Invention means any invention of the contractor
conceived or first actually reduced to practice in the performance
of work under this contract, provided that in the case of a variety
of plant, the date of determination (as defined in section 41(d) of
the Plant Variety Protection Act, 7 U.S.C. 2401(d)) shall also occur
during the period of contract performance.
(b) Allocation of Principal Rights.
(1) Retention of title by the Contractor. Except for exceptional
circumstance subject inventions, the contractor may retain the
entire right, title, and interest throughout the world to each
subject invention subject to the provisions of this clause and 35
U.S.C. 203. With respect to any subject invention in which the
Contractor retains title, the Federal government shall have a
nonexclusive, nontransferable, irrevocable, paid-up license to
practice or have practiced for or on behalf of the United States the
subject invention throughout the world.
(2) Exceptional circumstance subject inventions. Except to the
extent that rights are retained by the Contractor in a determination
of exceptional circumstances or granted to a contractor through a
determination of greater rights in accordance with subparagraph
(b)(4) of this clause, the Contractor does not have a right to
retain title to any exceptional circumstance subject inventions and
agrees to assign to the Government the entire right, title, and
interest, throughout the world, in and to any exceptional
circumstance subject inventions.
(i) Inventions within or relating to the following fields of
technology are exceptional circumstance subject inventions:
(A) uranium enrichment technology;
(B) storage and disposal of civilian high-level nuclear waste
and spent fuel technology; and
(C) national security technologies classified or sensitive under
Section 148 of the Atomic Energy Act (42 U.S.C. 2168).
(ii) Inventions made under any agreement, contract or
subcontract related to the following are exceptional circumstance
subject inventions:
(A) DOE Steel Initiative and Metals Initiative;
(B) U.S. Advanced Battery Consortium; and
(C) any funding agreement which is funded in part by the
Electric Power Research Institute (EPRI) or the Gas Research
Institute (GRI).
(iii) DOE reserves the right to unilaterally amend this contract
to modify, by deletion or insertion, technical fields, tasks, or
other classifications for the purpose of determining DOE exceptional
circumstance subject inventions.
(3) Treaties and international agreements. Any rights acquired
by the Contractor in subject inventions are subject to any
disposition of right, title, or interest in or to subject inventions
provided for in treaties or international agreements identified at
Appendix [Insert Reference] to this contract. DOE reserves the right
to unilaterally amend this contract to identify specific treaties or
international agreements entered into or to be entered into by the
Government after the effective date of this contract and to
effectuate those license or other rights which are necessary for the
Government to meet its obligations to foreign governments, their
nationals and international organizations
[[Page 81060]]
under such treaties or international agreements with respect to
subject inventions made after the date of the amendment.
(4) Contractor request for greater rights in exceptional
circumstance subject inventions. The Contractor may request rights
greater than allowed by the exceptional circumstance determination
in an exceptional circumstance subject invention by submitting such
a request in writing to Patent Counsel at the time the exceptional
circumstance subject invention is disclosed to DOE or within eight
(8) months after conception or first actual reduction to practice of
the exceptional circumstance subject invention, whichever occurs
first, unless a longer period is authorized in writing by the Patent
Counsel for good cause shown in writing by the Contractor. DOE may,
in its discretion, grant or refuse to grant such a request by the
Contractor.
(5) Contractor employee-inventor rights. If the Contractor does
not elect to retain title to a subject invention or does not request
greater rights in an exceptional circumstance subject invention, a
Contractor employee-inventor, after consultation with the Contractor
and with written authorization from the Contractor in accordance
with 10 CFR 784.9(b)(4), may request greater rights, including
title, in the subject invention or the exceptional circumstance
invention from DOE, and DOE may, in its discretion, grant or refuse
to grant such a request by the Contractor employee-inventor.
(6) Government assignment of rights in Government employees'
subject inventions. If a Government employee is a joint inventor of
a subject invention or of an exceptional circumstance subject
invention to which the Contractor has rights, the Government may
assign or refuse to assign to the Contractor any rights in the
subject invention or exceptional circumstance subject invention
acquired by the Government from the Government employee, in
accordance with 48 CFR 27.304-1(d). The rights assigned to the
Contractor are subject to any provision of this clause that is
applicable to subject inventions in which the Contractor retains
title, including reservation by the Government of a nonexclusive,
nontransferable, irrevocable, paid-up license, except that the
Contractor shall file its initial patent application claiming the
subject invention or exceptional circumstance invention within one
(1) year after the assignment of such rights. The Contractor shall
share royalties collected for the manufacture, use or sale of the
subject invention with the Government employee, as DOE deems
appropriate.
(c) Subject Invention Disclosure, Election of Title and Filing
of Patent Application by Contractor.
(1) Subject invention disclosure. The contractor will disclose
each subject invention to the Patent Counsel within two months after
the inventor discloses it in writing to contractor personnel
responsible for patent matters. The disclosure to the agency shall
be in the form of a written report and shall identify the contract
under which the invention was made and the inventor(s) and all
sources of funding by B&R code for the invention. It shall be
sufficiently complete in technical detail to convey a clear
understanding to the extent known at the time of the disclosure, of
the nature, purpose, operation, and the physical, chemical,
biological or electrical characteristics of the invention. The
disclosure shall also identify any publication, on sale or public
use of the invention and whether a manuscript describing the
invention has been submitted for publication and, if so, whether it
has been accepted for publication at the time of disclosure. The
disclosure shall include a written statement as to whether the
invention falls within an exceptional circumstance field. DOE will
make a determination and advise the Contractor within 30 days of
receipt of an invention disclosure as to whether the invention is an
exceptional circumstance subject invention. In addition, after
disclosure to the Patent Counsel, the Contractor will promptly
notify the agency of the acceptance of any manuscript describing the
invention for publication or of any on sale or public use planned by
the contractor. The Contractor shall obtain approval from Patent
Counsel prior to any release or publication of information
concerning any nonelectable subject invention such as an exceptional
circumstance subject invention or any subject invention related to a
treaty or international agreement.
(2) Election by the Contractor. Except as provided in paragraph
(b)(2) of this clause, the Contractor will elect in writing whether
or not to retain title to any such invention by notifying the
Federal agency within two years of disclosure to the Federal agency.
However, in any case where publication, on sale or public use has
initiated the one year statutory period wherein valid patent
protection can still be obtained in the United States, the period
for election of title may be shortened by the agency to a date that
is no more than 60 days prior to the end of the statutory period.
(3) Filing of patent applications by the Contractor. The
Contractor will file its initial patent application on a subject
invention to which it elects to retain title within one year after
election of title or, if earlier, or prior to the end of any 1-year
statutory period wherein valid patent protection can be obtained in
the United States after a publication, on sale, or public use. The
Contractor will file patent applications in additional countries or
international patent offices within either ten months of the
corresponding initial patent application or six months from the date
permission is granted by the Commissioner of Patents and Trademarks
to file foreign patent applications where such filing has been
prohibited by a Secrecy Order.
(4) Contractor's request for an extension of time. Requests for
an extension of the time for disclosure, election, and filing under
subparagraphs (c)(1), (2) and (3) may, at the discretion of Patent
Counsel, be granted.
(5) Publication Approval. During the course of the work under
this contract, the Contractor or its employees may desire to release
or publish information regarding scientific or technical
developments conceived or first actually reduced to practice in the
course of or under this contract. In order that public disclosure of
such information will not adversely affect the patent interest of
DOE or the Contractor, approval for release or publication shall be
secured from the Contractor personnel responsible for patent matters
prior to any such release or publication. Where DOE's approval of
publication is requested, DOE's response to such requests for
approval shall normally be provided within 90 days except in
circumstances in which a domestic patent application must be filed
in order to protect foreign rights. In the case involving foreign
patent rights, DOE shall be granted an additional 180 days with
which to respond to the request for approval, unless extended by
mutual agreement.
(d) Conditions When the Government May Obtain Title.
The Contractor will convey to the DOE, upon written request,
title to any subject invention--
(1) If the Contractor fails to disclose or elect title to the
subject invention within the times specified in paragraph (c) of
this clause, or elects not to retain title; provided, that DOE may
only request title within sixty (60) days after learning of the
failure of the Contractor to disclose or to elect within the
specified times.
(2) In those countries in which the Contractor fails to file a
patent application within the times specified in subparagraph (c) of
this clause; provided, however, that if the Contractor has filed a
patent application in a country after the times specified in
subparagraph (c) above, but prior to its receipt of the written
request of the DOE, the Contractor shall continue to retain title in
that country.
(3) In any country in which the Contractor decides not to
continue the prosecution of any application for, to pay the
maintenance fees on, or defend in a reexamination or opposition
proceeding on, a patent on a subject invention.
(4) If the Contractor requests that DOE acquire title or rights
from the Contractor in a subject invention to which the Contractor
had initially retained title or rights, or in an exceptional
circumstance subject invention to which the Contractor was granted
greater rights, DOE may acquire such title or rights from the
Contractor, or DOE may decide against acquiring such title or rights
from the Contractor, at DOE's sole discretion.
(e) Minimum Rights of the Contractor and Protection of the
Contractor's Right to File.
(1) Request for a Contractor license. The Contractor may request
the right to reserve a revocable, nonexclusive, royalty-free license
throughout the world in each subject invention to which the
Government obtains title, except if the Contractor fails to disclose
the invention within the times specified in paragraph (c) of this
clause. DOE may grant or refuse to grant such a request by the
Contractor. When DOE approves such reservation, the Contractor's
license will normally extend to its domestic subsidiaries and
affiliates, if any, within the corporate structure of which the
Contractor is a party and includes the right to grant sublicenses of
the same scope to the extent the Contractor was legally obligated to
do so at the time the contract was awarded. The license is
transferable only with the approval of DOE,
[[Page 81061]]
except when transferred to the successor of that part of the
contractor's business to which the invention pertains.
(2) Revocation or modification of a Contractor license. The
Contractor's domestic license may be revoked or modified by DOE to
the extent necessary to achieve expeditious practical application of
the subject invention pursuant to an application for an exclusive
license submitted in accordance with applicable provisions at 37 CFR
Part 404 and DOE licensing regulations at 10 CFR Part 781. This
license will not be revoked in the field of use or the geographical
areas in which the Contractor has achieved practical application and
continues to make the benefits of the subject invention reasonably
accessible to the public. The license in any foreign country may be
revoked or modified at the discretion of DOE to the extent the
Contractor, its licensees, or the domestic subsidiaries or
affiliates have failed to achieve practical application of the
subject invention in that foreign country.
(3) Notice of revocation of modification of a Contractor
license. Before revocation or modification of the license, DOE will
furnish the Contractor a written notice of its intention to revoke
or modify the license, and the Contractor will be allowed thirty
days (or such other time as may be authorized by DOE for good cause
shown by the Contractor) after the notice to show cause why the
license should not be revoked or modified. The Contractor has the
right to appeal, in accordance with applicable regulations in 37 CFR
part 404 and DOE licensing regulations at 10 CFR part 781 concerning
the licensing of Government owned inventions, any decision
concerning the revocation or modification of the license.
(f) Contractor Action to Protect the Government's Interest.
(1) Execution of delivery of title or license instruments. The
Contractor agrees to execute or to have executed, and promptly
deliver to the Patent Counsel all instruments necessary to
accomplish the following actions:
(i) establish or confirm the rights the Government has
throughout the world in those subject inventions to which the
Contractor elects to retain title, and
(ii) convey title to DOE when requested under subparagraphs (b)
or paragraph (d) of this clause and to enable the Government to
obtain patent protection throughout the world in that subject
invention.
(2) Contractor employee agreements. The Contractor agrees to
require, by written agreement, its employees, other than clerical
and nontechnical employees, to disclose promptly in writing to
Contractor personnel identified as responsible for the
administration of patent matters and in a format suggested by the
Contractor, each subject invention made under this contract in order
that the Contractor can comply with the disclosure provisions of
paragraph (c) of this clause, and to execute all papers necessary to
file patent applications on subject inventions and to establish the
Government's rights in the subject inventions. This disclosure
format should require, as a minimum, the information required by
subparagraph (c)(1) of this clause. The Contractor shall instruct
such employees, through employee agreements or other suitable
educational programs, on the importance of reporting inventions in
sufficient time to permit the filing of patent applications prior to
U.S. or foreign statutory bars.
(3) Notification of discontinuation of patent protection. The
contractor will notify the Patent Counsel of any decision not to
continue the prosecution of a patent application, pay maintenance
fees, or defend in a reexamination or opposition proceeding on a
patent, in any country, not less than thirty days before the
expiration of the response period required by the relevant patent
office.
(4) Notification of Government rights. The contractor agrees to
include, within the specification of any United States patent
applications and any patent issuing thereon covering a subject
invention, the following statement, ``This invention was made with
government support under (identify the contract) awarded by
(identify the Federal agency). The government has certain rights in
the invention.''
(5) Invention Identification Procedures. The Contractor shall
establish and maintain active and effective procedures to ensure
that subject inventions are promptly identified and timely disclosed
and shall submit a written description of such procedures to the
Contracting Officer so that the Contracting Officer may evaluate and
determine their effectiveness.
(6) Invention Filing Documentation. If the Contractor files a
domestic or foreign patent application claiming a subject invention,
the Contractor shall promptly submit to Patent Counsel, upon
request, the following information and documents:
(i) the filing date, serial number, title, and a copy of the
patent application (including an English-language version if filed
in a language other than English);
(ii) an executed and approved instrument fully confirmatory of
all Government rights in the subject invention; and
(iii) the patent number, issue date, and a copy of any issued
patent claiming the subject invention.
(7) Duplication and disclosure of documents. The Government may
duplicate and disclose subject invention disclosures and all other
reports and papers furnished or required to be furnished pursuant to
this clause; provided, however, that any such duplication or
disclosure by the Government is subject to the confidentiality
provision at 35 U.S.C. 205 and 37 CFR Part 40.
(g) Subcontracts.
(1) Subcontractor subject inventions. The Contractor shall not
obtain rights in the subcontractor's subject inventions as part of
the consideration for awarding a subcontract.
(2) Inclusion of patent rights clause--non-profit organization
or small business firm subcontractors. Unless otherwise authorized
or directed by the Contracting Officer, the Contractor shall include
the patent rights clause at 48 CFR 952.227-11, suitably modified to
identify the parties, in all subcontracts, at any tier, for
experimental, developmental, demonstration or research work to be
performed by a small business firm or domestic nonprofit
organization, except subcontracts which are subject to exceptional
circumstances in accordance with 35 U.S.C. 202 and subparagraph
(b)(2) of this clause. The subcontractor retains all rights provided
for the contractor in the patent rights clause at 48 CFR 952.227-11.
(3) Inclusion of patent rights clause--subcontractors other than
non-profit organizations and small business firms. Except for the
subcontracts described in subparagraph (g)(2) of this clause, the
Contractor shall include the patent rights clause at 48 CFR 952.227-
13, suitably modified to identify the parties, in any contract for
experimental, developmental, demonstration or research work. For
subcontracts subject to exceptional circumstances, the contractor
must consult with DOE patent counsel with respect to the appropriate
patent clause.
(4) DOE and subcontractor contract. With respect to subcontracts
at any tier, DOE, the subcontractor, and the Contractor agree that
the mutual obligations of the parties created by this clause
constitute a contract between the subcontractor and DOE with respect
to the matters covered by the clause; provided, however, that
nothing in this paragraph is intended to confer any jurisdiction
under the Contract Disputes Act in connection with proceedings under
paragraph (j) of this clause.
(5) Subcontractor refusal to accept terms of patent clause. If a
prospective subcontractor refuses to accept the terms of a patent
rights clause, the Contractor shall promptly submit a written notice
to the Contracting Officer stating the subcontractor's reasons for
such a refusal, including any relevant information for expediting
disposition of the matter, and the Contractor shall not proceed with
the subcontract without the written authorization of the Contracting
Officer.
(6) Notification of award of subcontract. Upon the award of any
subcontract at any tier containing a patent rights clause, the
Contractor shall promptly notify the Contracting Officer in writing
and identify the subcontractor, the applicable patent rights clause,
the work to be performed under the subcontract, and the dates of
award and estimated completion. Upon request of the Contracting
Officer, the Contractor shall furnish a copy of a subcontract.
(7) Identification of subcontractor subject inventions. If the
Contractor in the performance of this contract becomes aware of a
subject invention made under a subcontract, the Contractor shall
promptly notify Patent Counsel and identify the subject invention.
(h) Reporting on Utilization of Subject Inventions. The
Contractor agrees to submit to DOE on request, periodic reports, no
more frequently than annually, on the utilization of a subject
invention or on efforts at obtaining such utilization that are being
made by the Contractor or its licensees or assignees. Such reports
shall include information regarding the status of development, date
of first commercial sale or use, gross royalties received by the
Contractor, and such other data and information as DOE may
reasonably specify. The Contractor also agrees to provide additional
reports as may be requested by
[[Page 81062]]
DOE in connection with any march-in proceeding undertaken by DOE in
accordance with paragraph (j) of this clause. As required by 35
U.S.C. 202(c)(5), DOE agrees it will not disclose such information
to persons outside the Government without permission of the
Contractor.
(i) Preference for United States Industry. Notwithstanding any
other provision of this clause, the Contractor agrees that neither
it nor any assignee will grant to any person the exclusive right to
use or sell any subject invention in the United States unless such
person agrees that any product embodying the subject invention or
produced through the use of the subject invention will be
manufactured substantially in the United States. However, in
individual cases, the requirement for such an agreement may be
waived by DOE upon a showing by the Contractor or its assignee that
reasonable but unsuccessful efforts have been made to grant licenses
on similar terms to potential licensees that would be likely to
manufacture substantially in the United States or that under the
circumstances domestic manufacture is not commercially feasible.
(j) March-in Rights. The Contractor agrees that, with respect to
any subject invention in which it has acquired title, DOE has the
right in accordance with the procedures in 37 CFR 401.6 and any DOE
supplemental regulations to require the Contractor, an assignee or
exclusive licensee of a subject invention to grant a nonexclusive,
partially exclusive, or exclusive license in any field of use to a
responsible applicant or applicants, upon terms that are reasonable
under the circumstances, and, if the Contractor, assignee or
exclusive licensee refuses such a request, DOE has the right to
grant such a license itself if DOE determines that--
(1) Such action is necessary because the Contractor or assignee
has not taken, or is not expected to take within a reasonable time,
effective steps to achieve practical application of the subject
invention in such field of use;
(2) Such action is necessary to alleviate health or safety needs
which are not reasonably satisfied by the Contractor, assignee, or
their licensees;
(3) Such action is necessary to meet requirements for public use
specified by Federal regulations and such requirements are not
reasonably satisfied by the Contractor, assignee, or licensees; or
(4) Such action is necessary because the agreement required by
paragraph (i) of this clause has not been obtained or waived, or
because a licensee of the exclusive right to use or sell any subject
invention in the United States is in breach of such agreement.
(k) Special Provisions for Contracts With Nonprofit
Organizations. If the Contractor is a nonprofit organization, it
agrees that--
(1) DOE approval of assignment of rights. Rights to a subject
invention in the United States may not be assigned by the Contractor
without the approval of DOE, except where such assignment is made to
an organization which has as one of its primary functions the
management of inventions; provided, that such assignee will be
subject to the same provisions of this clause as the Contractor.
(2) Small business firm licensees. It will make efforts that are
reasonable under the circumstances to attract licensees of subject
inventions that are small business firms, and that it will give a
preference to a small business firm when licensing a subject
invention if the Contractor determines that the small business firm
has a plan or proposal for marketing the invention which, if
executed, is equally as likely to bring the invention to practical
application as any plans or proposals from applicants that are not
small business firms; provided, that the Contractor is also
satisfied that the small business firm has the capability and
resources to carry out its plan or proposal. The decision whether to
give a preference in any specific case will be at the discretion of
the Contractor. However, the Contractor agrees that the Secretary of
Commerce may review the Contractor's licensing program and decisions
regarding small business firm applicants, and the Contractor will
negotiate changes to its licensing policies, procedures, or
practices with the Secretary of Commerce when that Secretary's
review discloses that the Contractor could take reasonable steps to
more effectively implement the requirements of this subparagraph
(k)(2).
(3) Contractor licensing of subject inventions. To the extent
that it provides the most effective technology transfer, licensing
of subject inventions shall be administered by Contractor employees
on location at the facility.
(l) Communications. The Contractor shall direct any
notification, disclosure or request provided for in this clause to
the Patent Counsel assisting the DOE contracting activity.
(m) Reports.
(1) Interim reports. Upon DOE's request, the Contractor shall
submit to DOE, no more frequently than annually, a list of subject
inventions disclosed to DOE during a specified period, or a
statement that no subject inventions were made during the specified
period; and a list of subcontracts containing a patent clause and
awarded by the Contractor during a specified period, or a statement
that no such subcontracts were awarded during the specified period.
(2) Final reports. Upon DOE's request, the Contractor shall
submit to DOE, prior to closeout of the contract, a list of all
subject inventions disclosed during the performance period of the
contract, or a statement that no subject inventions were made during
the contract performance period; and a list of all subcontracts
containing a patent clause and awarded by the Contractor during the
contract performance period, or a statement that no such
subcontracts were awarded during the contract performance period.
(n) Examination of Records Relating to Subject Inventions. (1)
Contractor compliance. Until the expiration of three (3) years after
final payment under this contract, the Contracting Officer or any
authorized representative may examine any books (including
laboratory notebooks), records, documents, and other supporting data
of the Contractor, which the Contracting Officer or authorized
representative deems reasonably pertinent to the discovery or
identification of subject inventions, including exceptional
circumstance subject inventions, or to determine Contractor
compliance with any requirement of this clause.
(2) Unreported inventions. If the Contracting Officer is aware
of an invention that is not disclosed by the Contractor to DOE, and
the Contracting Officer believes the unreported invention may be a
subject invention, including exceptional circumstance subject
inventions, DOE may require the Contractor to submit to DOE a
disclosure of the invention for a determination of ownership rights.
(3) Confidentiality. Any examination of records under this
paragraph is subject to appropriate conditions to protect the
confidentiality of the information involved.
(4) Power of inspection. With respect to a subject invention for
which the Contractor has responsibility for patent prosecution, the
Contractor shall furnish the Government, upon request by DOE, an
irrevocable power to inspect and make copies of a prosecution file
for any patent application claiming the subject invention.
(o) Facilities License. In addition to the rights of the parties
with respect to inventions or discoveries conceived or first
actually reduced to practice in the course of or under this
contract, the Contractor agrees to and does hereby grant to the
Government an irrevocable, nonexclusive, paid-up license in and to
any inventions or discoveries regardless of when conceived or
actually reduced to practice or acquired by the Contractor at any
time through completion of this contract and which are incorporated
or embodied in the construction of the facility or which are
utilized in the operation of the facility or which cover articles,
materials, or product manufactured at the facility (1) to practice
or have practiced by or for the Government at the facility, and (2)
to transfer such license with the transfer of that facility.
Notwithstanding the acceptance or exercise by the Government of
these rights, the Government may contest at any time the
enforceability, validity or scope of, or title to, any rights or
patents herein licensed.
(p) Atomic Energy.
(1) Pecuniary awards. No claim for pecuniary award of
compensation under the provisions of the Atomic Energy Act of 1954,
as amended, may be asserted with respect to any invention or
discovery made or conceived in the course of or under this contract.
(2) Patent agreements. Except as otherwise authorized in writing
by the Contracting Officer, the Contractor shall obtain patent
agreements to effectuate the provisions of subparagraph (p)(1) of
this clause from all persons who perform any part of the work under
this contract, except nontechnical personnel, such as clerical
employees and manual laborers.
(q) Classified Inventions. (1) Approval for filing a foreign
patent application. The Contractor shall not file or cause to be
filed an application or registration for a patent disclosing a
subject invention related to classified subject matter in any
country other than the United States without first obtaining the
written approval of the Contracting Officer.
(2) Transmission of classified subject matter. If in accordance
with this clause the Contractor files a patent application in the
United States disclosing a subject invention
[[Page 81063]]
that is classified for reasons of security, the Contractor shall
observe all applicable security regulations covering the
transmission of classified subject matter. If the Contractor
transmits a patent application disclosing a classified subject
invention to the United States Patent and Trademark Office (USPTO),
the Contractor shall submit a separate letter to the USPTO
identifying the contract or contracts by agency and agreement number
that require security classification markings to be placed on the
patent application.
(3) Inclusion of clause in subcontracts. The Contractor agrees
to include the substance of this clause in subcontracts at any tier
that cover or are likely to cover subject matter classified for
reasons of security.
(r) Patent Functions. Upon the written request of the
Contracting Officer or Patent Counsel, the Contractor agrees to make
reasonable efforts to support DOE in accomplishing patent-related
functions for work arising out of the contract, including, but not
limited to, the prosecution of patent applications, and the
determination of questions of novelty, patentability, and
inventorship.
(s) Educational Awards Subject to 35 U.S.C. 212. The Contractor
shall notify the Contracting Officer prior to the placement of any
person subject to 35 U.S.C. 212 in an area of technology or task (1)
related to exceptional circumstance technology or (2) which is
subject to treaties or international agreements as set forth in
paragraph (b)(3) of this clause or agreements other than funding
agreements. The Contracting Officer may disapprove of any such
placement.
(t) Annual Appraisal by Patent Counsel. Patent Counsel may
conduct an annual appraisal to evaluate the Contractor's
effectiveness in identifying and protecting subject inventions in
accordance with DOE policy.
(End of clause)
Alternate 1 Weapons Related Subject Inventions. As prescribed at
970.2703-2(g), insert the following as subparagraphs (a)(10) and
(b)(7), respectively:
(a) Definitions. (10) Weapons Related Subject Invention means
any subject invention conceived or first actually reduced to
practice in the course of or under work funded by or through defense
programs , including Department of Defense and intelligence
reimbursable work, or the Naval Nuclear Propulsion Program of the
Department of Energy.
(b) Allocation of Principal Rights. (7) Weapons related subject
inventions. Except to the extent that DOE is solely satisfied that
the Contractor meets certain procedural requirements and DOE grants
rights to the Contractor in weapons related subject inventions, the
Contractor does not have the right to retain title to any weapons
related subject inventions.
(End of Alternate)
970.5227-11 Patent rights--management and operating contracts, for-
profit contractor, non-technology transfer.
Insert the following clause in solicitations and contracts in
accordance with 970.2703-1(b)(4):
Patent Rights--Management and Operating Contracts, for-Profit
Contractor, Non-Technology Transfer (DEC 2000)
(a) Definitions. (1) DOE licensing regulations means the
Department of Energy patent licensing regulations at 10 CFR Part
781.
(2) DOE patent waiver regulations means the Department of Energy
patent waiver regulations at 10 CFR Part 784.
(3) Invention means any invention or discovery which is or may
be patentable or otherwise protectable under title 35 of the United
States Code, or any novel variety of plant which is or may be
protected under the Plant Variety Protection Act (7 U.S.C. 2321, et
seq.).
(4) Made when used in relation to any invention means the
conception or first actual reduction to practice of such invention.
(5) Patent Counsel means DOE Patent Counsel assisting the
contracting activity.
(6) Practical application means to manufacture, in the case of a
composition or product; to practice, in the case of a process or
method; or to operate, in the case of a machine or system; and, in
each case, under such conditions as to establish that the invention
is being utilized and that its benefits are, to the extent permitted
by law or Government regulations, available to the public on
reasonable terms.
(7) Subject Invention means any invention of the contractor
conceived or first actually reduced to practice in the course of or
under this contract, provided that in the case of a variety of
plant, the date of determination (as defined in section 41(d) of the
Plant Variety Protection Act, 7 U.S.C. 2401(d)) shall also occur
during the period of contract performance.
(b) Allocation of Principal Rights. (1) Assignment to the
Government. Except to the extent that rights are retained by the
Contractor by a determination of greater rights in accordance with
subparagraph (b)(2) of this clause or by a request for foreign
patent rights in accordance with subparagraph (d)(2) of this clause,
the Contractor agrees to assign to the Government the entire right,
title, and interest throughout the world in and to each subject
invention.
(2) Greater rights determinations. The Contractor, or an
Contractor employee-inventor after consultation with the Contractor
and with the written authorization of the Contractor in accordance
with DOE patent waiver regulations, may request greater rights,
including title, in an identified subject invention than the
nonexclusive license and the foreign patent rights provided for in
paragraph (d) of this clause, in accordance with the DOE patent
waiver regulations. Such a request shall be submitted in writing to
Patent Counsel with a copy to the Contracting Officer at the time
the subject invention is first disclosed to DOE in accordance with
subparagraph (c)(2) of this clause, or not later than eight (8)
months after such disclosure, unless a longer period is authorized
in writing by the Contracting Officer for good cause shown in
writing by the Contractor. DOE may grant or refuse to grant such a
request by the Contractor or Contractor employee-inventor. Unless
otherwise provided in the greater rights determination, any rights
in a subject invention obtained by the Contractor pursuant to a
determination of greater rights are subject to a nonexclusive,
nontransferable, irrevocable, paid-up license to the Government to
practice or have practiced the subject invention throughout the
world by or on behalf of the Government of the United States
(including any Government agency), and to any reservations and
conditions deemed appropriate by the Secretary of Energy or
designee.
(c) Subject Invention Disclosures. (1) Contractor procedures for
reporting subject inventions to Contractor personnel. Subject
inventions shall be reported to Contractor personnel responsible for
patent matters within six (6) months of conception and/or first
actual reduction to practice, whichever occurs first in the
performance of work under this contract. Accordingly, the Contractor
shall establish and maintain effective procedures for ensuring such
prompt identification and timely disclosure of subject inventions to
Contractor personnel responsible for patent matters, and the
procedures shall include the maintenance of laboratory notebooks, or
equivalent records, and other records that are reasonably necessary
to document the conception and/or the first actual reduction to
practice of subject inventions, and the maintenance of records
demonstrating compliance with such procedures. The Contractor shall
submit a written description of such procedures to the Contracting
Officer, upon request, for evaluation of the effectiveness of such
procedures by the Contracting Officer.
(2) Subject invention disclosure. The Contractor shall disclose
each subject invention to Patent Counsel with a copy to the
Contracting Officer within two (2) months after the subject
invention is reported to Contractor personnel responsible for patent
matters, in accordance with subparagraph (c)(1) of this clause, or,
if earlier, within six (6) months after the Contractor has knowledge
of the subject invention, but in any event before any on sale,
public use, or publication of the subject invention. The disclosure
to DOE shall be in the form of a written report and shall include:
(i) the contract number under which the subject invention was
made;
(ii) the inventor(s) of the subject invention;
(iii) a description of the subject invention in sufficient
technical detail to convey a clear understanding of the nature,
purpose and operation of the subject invention, and of the physical,
chemical, biological or electrical characteristics of the subject
invention, to the extent known by the Contractor at the time of the
disclosure;
(iv) the date and identification of any publication, on sale or
public use of the invention;
(v) the date and identification of any submissions for
publication of any manuscripts describing the invention, and a
statement of whether the manuscript is accepted for publication, to
the extent known by the Contractor at the time of the disclosure;
[[Page 81064]]
(vi) a statement indicating whether the subject invention
concerns exceptional circumstances pursuant to 35 U.S.C. 202(ii),
related to national security, or subject to a treaty or an
international agreement, to the extent known or believed by
Contractor at the time of the disclosure;
(vii) all sources of funding by Budget and Resources (B&R) code;
and
(viii) the identification of any agreement relating to the
subject invention, including Cooperative Research and Development
Agreements and Work-for-Others agreements. Unless the Contractor
contends otherwise in writing at the time the invention is
disclosed, inventions disclosed to DOE under this paragraph are
deemed made in the manner specified in Sections (a)(1) and (a)(2) of
42 U.S.C. 5908.
(3) Publication after disclosure. After disclosure of the
subject invention to the DOE, the Contractor shall promptly notify
Patent Counsel of the acceptance for publication of any manuscript
describing the subject invention or of any expected or on sale or
public use of the subject invention, known by the Contractor.
(4) Contractor employee agreements. The Contractor agrees to
require, by written agreement, its employees, other than clerical
and nontechnical employees, to disclose promptly in writing to
Contractor personnel identified as responsible for the
administration of patent matters and in a format suggested by the
Contractor, each subject invention made under this contract, and to
execute all papers necessary to file patent applications claiming
subject inventions or to establish the Government's rights in the
subject inventions. This disclosure format shall at a minimum
include the information required by subparagraph (c)(2) of this
clause. The Contractor shall instruct such employees, through
employee agreements or other suitable educational programs, on the
importance of reporting inventions in sufficient time to permit the
filing of patent applications prior to U.S. or foreign statutory
bars.
(5) Contractor procedures for reporting subject inventions to
DOE. The Contractor agrees to establish and maintain effective
procedures for ensuring the prompt identification and timely
disclosure of subject inventions to DOE. The Contractor shall submit
a written description of such procedures to the Contracting Officer,
upon request, for evaluation of the effectiveness of such procedures
by the Contracting Officer.
(6) Duplication and disclosure of documents. The Government may
duplicate and disclose subject invention disclosures and all other
reports and papers furnished or required to be furnished pursuant to
this clause; provided, however, that any such duplication or
disclosure by the Government is subject to 35 U.S.C. 205 and 37 CFR
401.13.
(d) Minimum Rights of the Contractor. (1) Contractor License.
(i) Request for a Contractor license. Except for subject inventions
that the Contractor fails to disclose within the time periods
specified at subparagraph (c)(2) of this clause, the Contractor may
request a revocable, nonexclusive, royalty-free license in each
patent application filed in any country claiming a subject invention
and any resulting patent in which the Government obtains title, and
DOE may grant or refuse to grant such a request by the Contractor.
If DOE grants the Contractor's request for a license, the
Contractor's license extends to its domestic subsidiaries and
affiliates, if any, within the corporate structure of which the
Contractor is a party and includes the right to grant sublicenses of
the same scope to the extent the Contractor was legally obligated to
do so at the time the contract was awarded.
(ii) Transfer of a Contractor license. DOE shall approve any
transfer of the Contractor's license in a subject invention, and DOE
may determine the Contractor's license is non-transferrable, on a
case-by-case basis.
(iii) Revocation or modification of a Contractor license. DOE
may revoke or modify the Contractor's domestic license to the extent
necessary to achieve expeditious practical application of the
subject invention pursuant to an application for an exclusive
license submitted in accordance with applicable provisions in 37 CFR
Part 404 and DOE licensing regulations. DOE may not revoke the
Contractor's domestic license in that field of use or the
geographical areas in which the Contractor, its licensee, or its
domestic subsidiaries or affiliates achieved practical applications
and continues to make the benefits of the invention reasonably
accessible to the public. DOE may revoke or modify the Contractor's
license in any foreign country to the extent the Contractor, its
licensees, or its domestic subsidiaries or affiliates failed to
achieve practical application in that foreign country.
(iv) Notice of revocation or modification of a Contractor
license. Before revocation or modification of the license, DOE shall
furnish the Contractor a written notice of its intention to revoke
or modify the license, and the Contractor shall be allowed thirty
(30) days from the date of the notice (or such other time as may be
authorized by DOE for good cause shown by the Contractor) to show
cause why the license should not be revoked or modified. The
Contractor has the right to appeal any decision concerning the
revocation or modification of its license, in accordance with
applicable regulations in 37 CFR Part 404 and DOE licensing
regulations.
(2) Contractor's right to request foreign patent rights. If the
Government has title to a subject invention and the Government
decides against securing patent rights in a foreign country for the
subject invention, the Contractor may request such foreign patent
rights from DOE, and DOE may grant the Contractor's request, subject
to a nonexclusive, nontransferable, irrevocable, paid-up license to
the Government to practice or have practiced the subject invention
in the foreign country, and any reservations and conditions deemed
appropriate by the Secretary of Energy or designee. Such a request
shall be submitted in writing to the Patent Counsel as part of the
disclosure required by subparagraph (c)(2) of this clause, with a
copy to the DOE Contracting Officer, unless a longer period is
authorized in writing by the Contracting Officer for good cause
shown in writing by the Contractor. DOE may grant or refuse to grant
such a request, and may consider whether granting the Contractor's
request best serves the interests of the United States.
(e) Examination of Records Relating to Inventions. (1)
Contractor compliance. Until the expiration of three (3) years after
final payment under this contract, the Contracting Officer or any
authorized representative may examine any books (including
laboratory notebooks), records, and documents and other supporting
data of the Contractor, which the Contracting Officer or authorized
representative deems reasonably pertinent to the discovery or
identification of subject inventions, or to determine Contractor
(and inventor) compliance with the requirements of this clause,
including proper identification and disclosure of subject
inventions, and establishment and maintenance of invention
disclosure procedures.
(2) Unreported inventions. If the Contracting Officer is aware
of an invention that is not disclosed by the Contractor to DOE, and
the Contracting Officer believes the unreported invention may be a
subject invention, DOE may require the Contractor to submit to DOE a
disclosure of the invention for a determination of ownership rights.
(3) Confidentiality. Any examination of records under this
paragraph is subject to appropriate conditions to protect the
confidentiality of the information involved.
(f) Subcontracts. (1) Subcontractor subject inventions. The
Contractor shall not obtain rights in the subcontractor's subject
inventions as part of the consideration for awarding a subcontract.
(2) Inclusion of patent rights clause--non-profit organization
or small business firm subcontractors. Unless otherwise authorized
or directed by the Contracting Officer, the Contractor shall include
the patent rights clause at 48 CFR 952.227-11, suitably modified to
identify the parties in all subcontracts, at any tier, for
experimental, developmental, demonstration or research work to be
performed by a small business firm or domestic nonprofit
organization, except subcontracts which are subject to exceptional
circumstances in accordance with 35 U.S.C. 202(a)(ii).
(3) Inclusion of patent rights clause--subcontractors other than
non-profit organizations and small business firms. Except for the
subcontracts described in subparagraph (f)(2) of this clause, the
Contractor shall include the patent rights clause at 48 CFR 952.227-
13, suitably modified to identify the parties, in any contract for
experimental, developmental, demonstration or research work.
(4) DOE and subcontractor contract. With respect to subcontracts
at any tier, DOE, the subcontractor, and the Contractor agree that
the mutual obligations of the parties created by this clause
constitute a contract between the subcontractor and DOE with respect
to those matters covered by this clause.
(5) Subcontractor refusal to accept terms of patent rights
clause. If a prospective subcontractor refuses to accept the terms
of a patent rights clause, the Contractor shall promptly submit a
written notice to the Contracting Officer stating the
subcontractor's reasons for such a refusal, including any relevant
information for
[[Page 81065]]
expediting disposition of the matter, and the Contractor shall not
proceed with the subcontract without the written authorization of
the Contracting Officer.
(6) Notification of award of subcontract. Upon the award of any
subcontract at any tier containing a patent rights clause, the
Contractor shall promptly notify the Contracting Officer in writing
and identify the subcontractor, the applicable patent rights clause,
the work to be performed under the subcontract, and the dates of
award and estimated completion. Upon request of the Contracting
Officer, the Contractor shall furnish a copy of a subcontract.
(7) Identification of subcontractor subject inventions. If the
Contractor in the performance of this contract becomes aware of a
subject invention made under a subcontract, the Contractor shall
promptly notify Patent Counsel and identify the subject invention,
with a copy of the notification and identification to the
Contracting Officer.
(g) Atomic Energy. (1) Pecuniary awards. No claim for pecuniary
award of compensation under the provisions of the Atomic Energy Act
of 1954, as amended, may be asserted with respect to any invention
or discovery made or conceived in the course of or under this
contract.
(2) Patent Agreements. Except as otherwise authorized in writing
by the Contracting Officer, the Contractor shall obtain patent
agreements to effectuate the provisions of subparagraph (g)(1) of
this clause from all persons who perform any part of the work under
this contract, except nontechnical personnel, such as clerical
employees and manual laborers.
(h) Publication. The Contractor shall receive approval from
Patent Counsel prior to releasing or publishing information
regarding scientific or technical developments conceived or first
actually reduced to practice in the course of or under this
contract, to ensure such release or publication does not adversely
affect the patent interests of DOE or the Contractor.
(i) Communications. The Contractor shall direct any
notification, disclosure, or request provided for in this clause to
the Patent Counsel assisting the DOE contracting activity, with a
copy of the communication to the Contracting Officer.
(j) Reports. (1) Interim reports. Upon DOE's request, the
Contractor shall submit to DOE, no more frequently than annually, a
list of subject inventions disclosed to DOE during a specified
period, or a statement that no subject inventions were made during
the specified period; and/or a list of subcontracts containing a
patent clause and awarded by the Contractor during a specified
period, or a statement that no such subcontracts were awarded during
the specified period. The interim report shall state whether the
Contractor's invention disclosures were submitted to DOE in
accordance with the requirements of subparagraphs (c)(1) and (c)(5)
of this clause.
(2) Final reports. Upon DOE's request, the Contractor shall
submit to DOE, prior to closeout of the contract or within three (3)
months of the date of completion of the contracted work, a list of
all subject inventions disclosed during the performance period of
the contract, or a statement that no subject inventions were made
during the contract performance period; and/or a list of all
subcontracts containing a patent clause and awarded by the
Contractor during the contract performance period, or a statement
that no such subcontracts were awarded during the contract
performance period.
(k) Facilities License. In addition to the rights of the parties
with respect to inventions or discoveries conceived or first
actually reduced to practice in the course of or under this
contract, the Contractor agrees to and does hereby grant to the
Government an irrevocable, nonexclusive, paid-up license in and to
any inventions or discoveries regardless of when conceived or
actually reduced to practice or acquired by the contractor at any
time through completion of this contract and which are incorporated
or embodied in the construction of the facility or which are
utilized in the operation of the facility or which cover articles,
materials, or products manufactured at the facility (1) to practice
or have practiced by or for the Government at the facility, and (2)
to transfer such license with the transfer of that facility.
Notwithstanding the acceptance or exercise by the Government of
these rights, the Government may contest at any time the
enforceability, validity or scope of, or title to, any rights or
patents herein licensed.
(l) Classified Inventions. (1) Approval for filing a foreign
patent application. The Contractor shall not file or cause to be
filed an application or registration for a patent disclosing a
subject invention related to classified subject matter in any
country other than the United States without first obtaining the
written approval of the Contracting Officer.
(2) Transmission of classified subject matter. If in accordance
with this clause the Contractor files a patent application in the
United States disclosing a subject invention that is classified for
reasons of security, the Contractor shall observe all applicable
security regulations covering the transmission of classified subject
matter. If the Contractor transmits a patent application disclosing
a classified subject invention to the United States Patent and
Trademark Office (USPTO), the Contractor shall submit a separate
letter to the USPTO identifying the contract or contracts by agency
and agreement number that require security classification markings
to be placed on the patent application.
(3) Inclusion of clause in subcontracts. The Contractor agrees
to include the substance of this clause in subcontracts at any tier
that cover or are likely to cover subject matter classified for
reasons of security.
(m) Patent Functions. Upon the written request of the
Contracting Officer or Patent Counsel, the Contractor agrees to make
reasonable efforts to support DOE in accomplishing patent-related
functions for work arising out of the contract, including, but not
limited to, the prosecution of patent applications, and the
determination of questions of novelty, patentability, and
inventorship.
(n) Annual Appraisal by Patent Counsel. Patent Counsel may
conduct an annual appraisal to evaluate the Contractor's
effectiveness in identifying and protecting subject inventions in
accordance with DOE policy.
(End of Clause)
970.5227-12 Patent rights--management and operating contracts, for-
profit contractor, advance class waiver.
Insert the following clause in solicitations and contracts in
accordance with 970.2703-1(b)(3):
Patent Rights--Management and Operating Contracts, For-Profit
Contractor, Advance Class Waiver (DEC 2000)
(a) Definitions. (1) DOE licensing regulations means the
Department of Energy patent licensing regulations at 10 CFR Part
781.
(2) DOE patent waiver regulations means the Department of Energy
patent waiver regulations at 10 CFR Part 784.
(3) Exceptional Circumstance Subject Invention means any subject
invention in a technical field or related to a task determined by
the Department of Energy to be subject to an exceptional
circumstance under 35 U.S.C. 202(a)(ii), and in accordance with 37
CFR 401.3(e).
(4) Invention means any invention or discovery which is or may
be patentable or otherwise protectable under title 35 of the United
States Code, or any novel variety of plant which is or may be
protected under the Plant Variety Protection Act (7 U.S.C. 2321, et
seq.).
(5) Made when used in relation to any invention means the
conception or first actual reduction to practice of such invention.
(6) Patent Counsel means DOE Patent Counsel assisting the
contracting activity.
(7) Practical application means to manufacture, in the case of a
composition or product; to practice, in the case of a process or
method; or to operate, in the case of a machine or system; and, in
each case, under such conditions as to establish that the invention
is being utilized and that its benefits are, to the extent permitted
by law or Government regulations, available to the public on
reasonable terms.
(8) Subject Invention means any invention of the contractor
conceived or first actually reduced to practice in the course of or
under this contract, provided that in the case of a variety of
plant, the date of determination (as defined in section 41(d) of the
Plant Variety Protection Act, 7 U.S.C. 2401(d)) shall also occur
during the period of contract performance.
(b) Allocation of Principal Rights. (1) Assignment to the
Government. Except to the extent that rights are retained by
[[Page 81066]]
the Contractor by the granting of an advance class waiver pursuant
to subparagraph (b)(2) of this clause or a determination of greater
rights pursuant to subparagraph (b)(7) of this clause, the
Contractor agrees to assign to the Government the entire right,
title, and interest throughout the world in and to each subject
invention.
(2) Advance class waiver of Government rights to the Contractor.
DOE may grant to the Contractor an advance class waiver of
Government rights in any or all subject inventions, at the time of
execution of the contract, such that the Contractor may elect to
retain the entire right, title and interest throughout the world to
such waived subject inventions, in accordance with the terms and
conditions of the advance class waiver. Unless otherwise provided by
the terms of the advance class waiver, any rights in a subject
invention retained by the Contractor under an advance class waiver
are subject to 35 U.S.C. 203 and the provisions of this clause,
including the Government license provided for in subparagraph (b)(3)
of this clause, and any reservations and conditions deemed
appropriate by the Secretary of Energy or designee.
(3) Government license. With respect to any subject invention to
which the Contractor retains title, either under an advance class
waiver pursuant to subparagraph (b)(2) or a determination of greater
rights pursuant to subparagraph (b)(7) of this clause, the
Government has a nonexclusive, nontransferable, irrevocable, paid-up
license to practice or have practiced for or on behalf of the United
States the subject invention throughout the world.
(4) Foreign patent rights. If the Government has title to a
subject invention and the Government decides against securing patent
rights in a foreign country for the subject invention, the
Contractor may request such foreign patent rights from DOE, and DOE
may grant the Contractor's request, subject to 35 U.S.C. 203 and the
provisions of this clause, including the Government license provided
for in subparagraph (b)(3) of this clause, and any reservations and
conditions deemed appropriate by the Secretary of Energy or
designee.
(5) Exceptional circumstance subject inventions. Except to the
extent that rights are retained by the Contractor by a determination
of greater rights in accordance with subparagraph (b)(7) of this
clause, the Contractor does not have the right to retain title to
any exceptional circumstance subject inventions and agrees to assign
to the Government the entire right, title, and interest, throughout
the world, in and to any exceptional circumstance subject
inventions.
(i) Inventions within or relating to the following fields of
technology are exceptional circumstance subject inventions:
(A) uranium enrichment technology;
(B) storage and disposal of civilian high-level nuclear waste
and spent fuel technology; and
(C) national security technologies classified or sensitive under
Section 148 of the Atomic Energy Act (42 U.S.C. 2168).
(ii) Inventions made under any agreement, contract or
subcontract related to the following initiatives or programs are
exceptional circumstance subject inventions:
(A) DOE Steel Initiative and Metals Initiative;
(B) U.S. Advanced Battery Consortium; and
(C) any funding agreement which is funded in part by the
Electric Power Research Institute (EPRI) or the Gas Research
Institute (GRI).
(iii) DOE reserves the right to unilaterally amend this contract
to modify, by deletion or insertion, technical fields, programs,
initiatives, and/or other classifications for the purpose of
defining DOE exceptional circumstance subject inventions.
(6) Treaties and international agreements. Any rights acquired
by the Contractor in subject inventions are subject to any
disposition of right, title, or interest in or to subject inventions
provided for in treaties or international agreements identified at
Appendix [Insert Reference], to this contract. DOE reserves the
right to unilaterally amend this contract to identify specific
treaties or international agreements entered into or to be entered
into by the Government after the effective date of this contract and
to effectuate those license or other rights which are necessary for
the Government to meet its obligations to foreign governments, their
nationals and international organizations under such treaties or
international agreements with respect to subject inventions made
after the date of the amendment.
(7) Contractor request for greater rights. The Contractor may
request greater rights in an identified subject invention, including
an exceptional circumstance subject invention, to which the
Contractor does not have the right to elect to retain title, in
accordance with the DOE patent waiver regulations, by submitting
such a request in writing to Patent Counsel with a copy to the
Contracting Officer at the time the subject invention is first
disclosed to DOE pursuant to subparagraph (c)(1) of this clause, or
not later than eight (8) months after such disclosure, unless a
longer period is authorized in writing by the Contracting Officer
for good cause shown in writing by the Contractor. DOE may grant or
refuse to grant such a request by the Contractor. Unless otherwise
provided in the greater rights determination, any rights in a
subject invention obtained by the Contractor under a determination
of greater rights is subject to 35 U.S.C. 203 and the provisions of
this clause, including the Government license provided for in
subparagraph (b)(3) of this clause, and to any reservations and
conditions deemed appropriate by the Secretary of Energy or
designee.
(8) Contractor employee-inventor rights. If the Contractor does
not elect to retain title to a subject invention or does not request
greater rights in a subject invention, including an exceptional
circumstance subject invention, to which the Contractor does not
have the right to elect to retain title, a Contractor employee-
inventor, after consultation with the Contractor and with written
authorization from the Contractor in accordance with 10 CFR
784.9(b)(4), may request greater rights, including title, in the
subject invention or the exceptional circumstance invention from
DOE, and DOE may grant or refuse to grant such a request by the
Contractor employee-inventor.
(9) Government assignment of rights in Government employees'
subject inventions. If a DOE employee is a joint inventor of a
subject invention to which the Contractor has rights, DOE may assign
or refuse to assign any rights in the subject invention acquired by
the Government from the DOE employee to the Contractor, consistent
with 48 CFR 27.304-1(d). Unless otherwise provided in the
assignment, the rights assigned to the Contractor are subject to the
Government license provided for in subparagraph (b)(3) of this
clause, and to any provision of this clause applicable to subject
inventions in which rights are retained by the Contractor, and to
any reservations and conditions deemed appropriate by the Secretary
of Energy or designee. The Contractor shall share royalties
collected for the manufacture, use or sale of the subject invention
with the DOE employee, as DOE deems appropriate.
(c) Subject Invention Disclosure, Election of Title, and Filing
of Patent Application by Contractor. (1) Subject invention
disclosure. The Contractor shall disclose each subject invention to
Patent Counsel with a copy to the Contracting Officer within two (2)
months after an inventor discloses it in
[[Page 81067]]
writing to Contractor personnel responsible for patent matters or,
if earlier, within six (6) months after the Contractor has knowledge
of the subject invention, but in any event before any on sale,
public use, or publication of the subject invention. The disclosure
to DOE shall be in the form of a written report and shall include:
(i) the contract number under which the subject invention was
made;
(ii) the inventor(s) of the subject invention;
(iii) a description of the subject invention in sufficient
technical detail to convey a clear understanding of the nature,
purpose and operation of the subject invention, and of the physical,
chemical, biological or electrical characteristics of the subject
invention, to the extent known by the Contractor at the time of the
disclosure;
(iv) the date and identification of any publication, on sale or
public use of the invention;
(v) the date and identification of any submissions for
publication of any manuscripts describing the invention, and a
statement of whether the manuscript is accepted for publication, to
the extent known by the Contractor at the time of the disclosure;
(vi) a statement indicating whether the subject invention is an
exceptional circumstance subject invention, related to national
security, or subject to a treaty or an international agreement, to
the extent known or believed by Contractor at the time of the
disclosure;
(vii) all sources of funding by Budget and Resources (B&R) code;
and
(viii) the identification of any agreement relating to the
subject invention, including Cooperative Research and Development
Agreements and Work-for-Others agreements.
Unless the Contractor contends otherwise in writing at the time
the invention is disclosed, inventions disclosed to DOE under this
paragraph are deemed made in the manner specified in Sections (a)(1)
and (a)(2) of 42 U.S.C. 5908.
(2) Publication after disclosure. After disclosure of the
subject invention to the DOE, the Contractor shall promptly notify
Patent Counsel of the acceptance for publication of any manuscript
describing the subject invention or of any expected or on sale or
public use of the subject invention, known by the Contractor. The
Contractor shall obtain approval from Patent Counsel prior to any
release or publication of information concerning an exceptional
circumstance subject invention or any subject invention related to a
treaty or international agreement.
(3) Election by the Contractor under an advance class waiver. If
the Contractor has the right to elect to retain title to subject
inventions under an advance class waiver granted in accordance with
subparagraph (b)(2) of this clause, and unless otherwise provided
for by the terms of the advance class waiver, the Contractor shall
elect in writing whether or not to retain title to any subject
invention by notifying DOE within two (2) years of the date of the
disclosure of the subject invention to DOE, in accordance with
subparagraph (c)(1) of this clause. The notification shall identify
the advance class waiver, state the countries, including the United
States, in which rights are retained, and certify that the subject
invention is not an exceptional circumstance subject invention or
subject to a treaty or international agreement. If a publication, on
sale or public use of the subject invention has initiated the 1-year
statutory period under 35 U.S.C. 102(b), the period for election may
be shortened by DOE to a date that is no more than sixty (60) days
prior to the end of the 1-year statutory period.
(4) Filing of patent applications by the Contractor under an
advance class waiver. If the Contractor has the right to retain
title to a subject invention in accordance with an advance class
waiver pursuant to subparagraph (b)(2) of this clause or a
determination of greater rights pursuant to paragraph (b)(7) of this
clause, and unless otherwise provided for by the terms of the
advance class waiver or greater rights determination, the Contractor
shall file an initial patent application claiming the subject
invention to which it retains title either within one (1) year after
the Contractor's election to retain or grant of title to the subject
invention or prior to the end of any 1-year statutory period under
35 U.S.C. 102(b), whichever occurs first. Any patent applications
filed by the Contractor in foreign countries or international patent
offices shall be filed within either ten (10) months of the
corresponding initial patent application or, if such filing has been
prohibited by a Secrecy Order, within six (6) months from the date
permission is granted by the Commissioner of Patents and Trademarks
to file foreign patent applications.
(5) Submission of patent information and documents. If the
Contractor files a domestic or foreign patent application claiming a
subject invention, the Contractor shall promptly submit to Patent
Counsel the following information and documents:
(i) The filing date, serial number, title, and a copy of the
patent application (including an English-language version if filed
in a language other than English);
(ii) An executed and approved instrument fully confirmatory of
all Government rights in the subject invention; and
(iii) The patent number, issue date, and a copy of any issued
patent claiming the subject invention.
(6) Contractor's request for an extension of time. Requests for
an extension of the time to disclose a subject invention, to elect
to retain title to a subject invention, or to file a patent
application under subparagraphs (c)(1), (3), and (4) of this clause
may be granted at the discretion of Patent Counsel or DOE.
(7) Duplication and disclosure of documents. The Government may
duplicate and disclose subject invention disclosures and all other
reports and papers furnished or required to be furnished pursuant to
this clause; provided, however, that any such duplication or
disclosure by the Government is subject to 35 U.S.C. 205 and 37 CFR
Part 40.
(d) Conditions When the Government May Obtain Title
Notwithstanding an Advance Class Waiver. (1) Return of title to a
subject invention. If the Contractor requests that DOE acquire title
or rights from the Contractor in a subject invention, including an
exceptional circumstance subject invention, to which the Contractor
retained title or rights under subparagraph (b)(2) or subparagraph
(b)(7) of this clause, DOE may acquire such title or rights from the
Contractor, or DOE may decide against acquiring such title or rights
from the Contractor, at DOE's sole discretion.
(2) Failure to disclose or elect to retain title. Title vests in
DOE and DOE may request, in writing, a formal assignment of title to
a subject invention from the Contractor, and the Contractor shall
convey title to the subject invention to DOE, if the Contractor
elects not to retain title to the subject invention under an advance
class waiver, or the Contractor fails to disclose or fails to elect
to retain title to the subject invention within the times specified
in subparagraphs (c)(1) and (c)(3) of this clause.
(3) Failure to file domestic or foreign patent applications. In
those countries in which the Contractor fails to file a patent
application within the times specified in subparagraph (c)(4) of
this clause, DOE may request, in writing, title to the subject
invention from the Contractor, and the Contractor shall convey title
to the subject invention to
[[Page 81068]]
DOE; provided, however, that if the Contractor has filed a patent
application in any country after the times specified in subparagraph
(c)(4) of this clause, but prior to its receipt of DOE's written
request for title, the Contractor continues to retain title in that
country.
(4) Discontinuation of patent protection by the Contractor. If
the Contractor decides to discontinue the prosecution of a patent
application, the payment of maintenance fees, or the defense of a
subject invention in a reexamination or opposition proceeding, in
any country, DOE may request, in writing, title to the subject
invention from the Contractor, and the Contractor shall convey title
to the subject invention to DOE.
(5) Termination of advance class waiver. DOE may request, in
writing, title to any subject inventions from the Contractor, and
the Contractor shall convey title to the subject inventions to DOE,
if the advance class waiver granted under subparagraph (b)(2) of
this clause is terminated under paragraph (u) of this clause.
(e) Minimum Rights of the Contractor. (1) Request for a
Contractor license. Except for subject inventions that the
Contractor fails to disclose within the time periods specified at
subparagraph (c)(1) of this clause, the Contractor may request a
revocable, nonexclusive, royalty-free license in each patent
application filed in any country claiming a subject invention and
any resulting patent in which the Government obtains title, and DOE
may grant or refuse to grant such a request by the Contractor. If
DOE grants the Contractor's request for a license, the Contractor's
license extends to its domestic subsidiaries and affiliates, if any,
within the corporate structure of which the Contractor is a party
and includes the right to grant sublicenses of the same scope to the
extent the Contractor was legally obligated to do so at the time the
contract was awarded.
(2) Transfer of a Contractor license. DOE shall approve any
transfer of the Contractor's license in a subject invention, and DOE
may determine that the Contractor's license is non-transferrable, on
a case-by-case basis.
(3) Revocation or modification of a Contractor license. DOE may
revoke or modify the Contractor's domestic license to the extent
necessary to achieve expeditious practical application of the
subject invention pursuant to an application for an exclusive
license submitted in accordance with applicable provisions in 37 CFR
Part 404 and DOE licensing regulations. DOE may not revoke the
Contractor's domestic license in that field of use or the
geographical areas in which the Contractor, its licensees or its
domestic subsidiaries or affiliates have achieved practical
applications and continues to make the benefits of the invention
reasonably accessible to the public. DOE may revoke or modify the
Contractor's license in any foreign country to the extent the
Contractor, its licensees, or its domestic subsidiaries or
affiliates failed to achieve practical application in that foreign
country.
(4) Notice of revocation or modification of a Contractor
license. Before revocation or modification of the license, DOE shall
furnish the Contractor a written notice of its intention to revoke
or modify the license, and the Contractor shall be allowed thirty
(30) days from the date of the notice (or such other time as may be
authorized by DOE for good cause shown by the Contractor) to show
cause why the license should not be revoked or modified. The
Contractor has the right to appeal any decision concerning the
revocation or modification of its license, in accordance with
applicable regulations in 37 CFR Part 404 and DOE licensing
regulations.
(f) Contractor Action to Protect the Government's Interest. (1)
Execution and delivery of title or license instruments. The
Contractor agrees to execute or have executed, and to deliver
promptly to DOE all instruments necessary to accomplish the
following actions:
(i) establish or confirm the Government's rights throughout the
world in subject inventions to which the Contractor elects to retain
title;
(ii) convey title in a subject invention to DOE pursuant to
subparagraph (b)(5) and paragraph (d) of this clause; or
(iii) enable the Government to obtain patent protection
throughout the world in a subject invention to which the Government
has title.
(2) Contractor employee agreements. The Contractor agrees to
require, by written agreement, its employees, other than clerical
and nontechnical employees, to disclose promptly in writing to
Contractor personnel identified as responsible for the
administration of patent matters and in a format suggested by the
Contractor, each subject invention made under this contract, and to
execute all papers necessary to file patent applications claiming
subject inventions or to establish the Government's rights in the
subject inventions. This disclosure format shall at a minimum
include the information required by subparagraph (c)(1) of this
clause. The Contractor shall instruct such employees, through
employee agreements or other suitable educational programs, on the
importance of reporting inventions in sufficient time to permit the
filing of patent applications prior to U.S. or foreign statutory
bars.
(3) Contractor procedures for reporting subject inventions to
DOE. The Contractor agrees to establish and maintain effective
procedures for ensuring the prompt identification and timely
disclosure of subject inventions to DOE. The Contractor shall submit
a written description of such procedures to the Contracting Officer,
upon request, for evaluation and approval of the effectiveness of
such procedures by the Contracting Officer.
(4) Notification of discontinuation of patent protection. With
respect to any subject invention for which the Contractor has
responsibility for patent prosecution, the Contractor shall notify
Patent Counsel of any decision to discontinue the prosecution of a
patent application, payment of maintenance fees, or defense of a
subject invention in a reexamination or opposition proceeding, in
any country, not less than thirty (30) days before the expiration of
the response period for any action required by the corresponding
patent office.
(5) Notification of Government rights. With respect to any
subject invention to which the Contractor has title, the Contractor
agrees to include, within the specification of any United States
patent application and within any patent issuing thereon claiming a
subject invention, the following statement, ``This invention was
made with Government support under (identify the contract) awarded
by the United States Department of Energy. The Government has
certain rights in the invention.''
(6) Avoidance of Royalty Charges. If the Contractor licenses a
subject invention, the Contractor agrees to avoid royalty charges on
acquisitions involving Government funds, including funds derived
through a Military Assistance Program of the Government or otherwise
derived through the Government, to refund any amounts received as
royalty charges on a subject invention in acquisitions for, or on
behalf of, the Government, and to provide for such refund in any
instrument transferring rights in the subject invention to any
party.
(7) DOE approval of assignment of rights. Rights in a subject
invention in the United States may not be assigned by the Contractor
without the approval of DOE.
(8) Small business firm licensees. The Contractor shall make
efforts that are reasonable under the circumstances to attract
licensees of subject inventions
[[Page 81069]]
that are small business firms, and may give a preference to a small
business firm when licensing a subject invention if the Contractor
determines that the small business firm has a plan or proposal for
marketing the invention which, if executed, is equally as likely to
bring the invention to practical application as any plans or
proposals from applicants that are not small business firms;
provided, the Contractor is also satisfied that the small business
firm has the capability and resources to carry out its plan or
proposal. The decision as to whether to give a preference in any
specific case is at the discretion of the Contractor.
(9) Contractor licensing of subject inventions. To the extent
that it provides the most effective technology transfer, licensing
of subject inventions shall be administered by Contractor employees
on location at the facility.
(g) Subcontracts. (1) Subcontractor subject inventions. The
Contractor shall not obtain rights in the subcontractor's subject
inventions as part of the consideration for awarding a subcontract.
(2) Inclusion of patent rights clause--non-profit organization
or small business firm subcontractors. Unless otherwise authorized
or directed by the Contracting Officer, the Contractor shall include
the patent rights clause at 48 CFR 952.227-11, suitably modified to
identify the parties, in all subcontracts, at any tier, for
experimental, developmental, demonstration or research work to be
performed by a small business firm or domestic nonprofit
organization, except subcontracts which are subject to exceptional
circumstances in accordance with 35 U.S.C. 202 and subparagraph
(b)(5) of this clause.
(3) Inclusion of patent rights clause--subcontractors other than
non-profit organizations or small business firms. Except for the
subcontracts described in subparagraph (g)(2) of this clause, the
Contractor shall include the patent rights clause at 48 CFR 952.227-
13, suitably modified to identify the parties and any applicable
exceptional circumstance, in any contract for experimental,
developmental, demonstration or research work.
(4) DOE and subcontractor contract. With respect to subcontracts
at any tier, DOE, the subcontractor and Contractor agree that the
mutual obligations of the parties created by this clause constitute
a contract between the subcontractor and DOE with respect to those
matters covered by this clause; provided, however, that nothing in
this paragraph is intended to confer any jurisdiction under the
Contract Disputes Act in connection with proceedings under paragraph
(j) of this clause.
(5) Subcontractor refusal to accept terms of patent rights
clause. If a prospective subcontractor refuses to accept the terms
of a patent rights clause, the Contractor shall promptly submit a
written notice to the Contracting Officer stating the
subcontractor's reasons for such refusal and including relevant
information for expediting disposition of the matter; and the
Contractor shall not proceed with the subcontract without the
written authorization of the Contracting Officer.
(6) Notification of award of subcontract. Upon the award of any
subcontract at any tier containing a patent rights clause, the
Contractor shall promptly notify the Contracting Officer in writing
and identify the subcontractor, the applicable patent rights clause,
the work to be performed under the subcontract, and the dates of
award and estimated completion. Upon request of the Contracting
Officer, the Contractor shall furnish a copy of a subcontract.
(7) Identification of subcontractor subject inventions. If the
Contractor in the performance of this contract becomes aware of a
subject invention made under a subcontract, the Contractor shall
promptly notify Patent Counsel and identify the subject invention,
with a copy of the notification and identification to the
Contracting Officer.
(h) Reporting on Utilization of Subject Inventions. Upon request
by DOE, the Contractor agrees to submit periodic reports, no more
frequently than annually, describing the utilization of a subject
invention or efforts made by the Contractor or its licensees or
assignees to obtain utilization of the subject invention. The
reports shall include information regarding the status of
development, date of first commercial sale or use, gross royalties
received by the Contractor, and other data and information
reasonably specified by DOE. Upon request by DOE, the Contractor
also agrees to provide reports in connection with any march-in
proceedings undertaken by DOE, in accordance with paragraph (j) of
this clause. If any data or information reported by the Contractor
in accordance with this provision is considered privileged and
confidential by the Contractor, its licensee, or assignee and the
Contractor properly marks the data or information privileged or
confidential, DOE agrees not to disclose such information to persons
outside the Government, to the extent permitted by law.
(i) Preference for United States Industry. Notwithstanding any
other provision of this clause the Contractor agrees that with
respect to any subject invention in which it retains title, neither
it nor any assignee may grant to any person the exclusive right to
use or sell any subject invention in the United States unless such
person agrees that any products embodying the subject invention or
produced through the use of the subject invention will be
manufactured substantially in the United States. However, in
individual cases, DOE may waive the requirement for such an
agreement upon a showing by the Contractor or its assignee that
reasonable but unsuccessful efforts have been made to grant licenses
on similar terms to potential licensees that would be likely to
manufacture substantially in the United States or that under the
circumstances domestic manufacture is not commercially feasible.
(j) March-In Rights. With respect to any subject invention to
which the Contractor has elected to retain or is granted title, DOE
may, in accordance with the procedures in the DOE patent waiver
regulations, require the Contractor, an assignee or exclusive
licensee of a subject invention to grant a nonexclusive, partially
exclusive or exclusive license in any field of use to a responsible
applicant or applicants, upon terms that are reasonable under the
circumstances. If the Contractor, assignee or exclusive licensee
refuses such a request, DOE has the right to grant such a license
itself if DOE determines that--
(1) Such action is necessary because the Contractor or assignee
has not taken, or is not expected to take within a reasonable time,
effective steps to achieve practical application of the subject
invention in such field of use;
(2) Such action is necessary to alleviate health or safety needs
that are not reasonably satisfied by the Contractor, assignee, or
their licensees;
(3) Such action is necessary to meet requirements for public use
specified by government regulations and such requirements are not
reasonably satisfied by the Contractor, assignee, or licensees; or
(4) Such action is necessary because the agreement to
substantially manufacture in the United States and required by
paragraph (i) of this clause has neither been obtained nor waived or
because a licensee of the exclusive right to use or sell any subject
invention in the United States is in breach of such agreement.
(k) Communications. The Contractor shall direct any
notification, disclosure, or request provided for in this clause to
[[Page 81070]]
the Patent Counsel identified in the contract.
(l) Reports. (1) Interim reports. Upon DOE's request, the
Contractor shall submit to DOE, no more frequently than annually, a
list of subject inventions disclosed to DOE during a specified
period, or a statement that no subject inventions were made during
the specified period; and/or a list of subcontracts containing a
patent clause and awarded by the Contractor during a specified
period, or a statement that no such subcontracts were awarded during
the specified period. The interim report shall state whether the
Contractor's invention disclosures were submitted to DOE in
accordance with the requirements of subparagraphs (f)(3) and (f)(4)
of this clause.
(2) Final reports. Upon DOE's request, the Contractor shall
submit to DOE, prior to closeout of the contract or within three (3)
months of the date of completion of the contracted work, a list of
all subject inventions disclosed during the performance period of
the contract, or a statement that no subject inventions were made
during the contract performance period; and/or a list of all
subcontracts containing a patent clause and awarded by the
Contractor during the contract performance period, or a statement
that no such subcontracts were awarded during the contract
performance period.
(m) Facilities License. In addition to the rights of the parties
with respect to inventions or discoveries conceived or first
actually reduced to practice in the course of or under this
contract, the Contractor agrees to and does hereby grant to the
Government an irrevocable, nonexclusive, paid-up license in and to
any inventions or discoveries regardless of when conceived or
actually reduced to practice or acquired by the contractor at any
time through completion of this contract and which are incorporated
or embodied in the construction of the facility or which are
utilized in the operation of the facility or which cover articles,
materials, or products manufactured at the facility (1) to practice
or have practiced by or for the Government at the facility, and (2)
to transfer such license with the transfer of that facility.
Notwithstanding the acceptance or exercise by the Government of
these rights, the Government may contest at any time the
enforceability, validity or scope of, or title to, any rights or
patents herein licensed.
(n) Atomic Energy. (1) Pecuniary awards. No claim for pecuniary
award of compensation under the provisions of the Atomic Energy Act
of 1954, as amended, may be asserted with respect to any invention
or discovery made or conceived in the course of or under this
contract.
(2) Patent Agreements. Except as otherwise authorized in writing
by the Contracting Officer, the Contractor shall obtain patent
agreements to effectuate the provisions of subparagraph (o)(1) of
this clause from all persons who perform any part of the work under
this contract, except nontechnical personnel, such as clerical
employees and manual laborers.
(o) Classified Inventions. (1) Approval for filing a foreign
patent application. The Contractor shall not file or cause to be
filed an application or registration for a patent disclosing a
subject invention related to classified subject matter in any
country other than the United States without first obtaining the
written approval of the Contracting Officer.
(2) Transmission of classified subject matter. If in accordance
with this clause the Contractor files a patent application in the
United States disclosing a subject invention that is classified for
reasons of security, the Contractor shall observe all applicable
security regulations covering the transmission of classified subject
matter. If the Contractor transmits a patent application disclosing
a classified subject invention to the United States Patent and
Trademark Office (USPTO), the Contractor shall submit a separate
letter to the USPTO identifying the contract or contracts by agency
and agreement number that require security classification markings
to be placed on the patent application.
(3) Inclusion of clause in subcontracts. The Contractor agrees
to include the substance of this clause in subcontracts at any tier
that cover or are likely to cover subject matter classified for
reasons of security.
(p) Examination of Records Relating to Inventions. (1)
Contractor compliance. Until the expiration of three (3) years after
final payment under this contract, the Contracting Officer or any
authorized representative may examine any books (including
laboratory notebooks), records, and documents and other supporting
data of the Contractor, which the Contracting Officer or authorized
representative deems reasonably pertinent to the discovery or
identification of subject inventions, including exceptional
circumstance subject inventions, or to determine Contractor (and
inventor) compliance with the requirements of this clause, including
proper identification and disclosure of subject inventions, and
establishment and maintenance of invention disclosure procedures.
(2) Unreported inventions. If the Contracting Officer is aware
of an invention that is not disclosed by the Contractor to DOE, and
the Contracting Officer believes the unreported invention may be a
subject invention, DOE may require the Contractor to submit to DOE a
disclosure of the invention for a determination of ownership rights.
(3) Confidentiality. Any examination of records under this
paragraph is subject to appropriate conditions to protect the
confidentiality of the information involved.
(4) Power of inspection. With respect to a subject invention for
which the Contractor has responsibility for patent prosecution, the
Contractor shall furnish the Government, upon request by DOE, an
irrevocable power to inspect and make copies of a prosecution file
for any patent application claiming the subject invention.
(q) Patent Functions. Upon the written request of the
Contracting Officer or Patent Counsel, the Contractor agrees to make
reasonable efforts to support DOE in accomplishing patent-related
functions for work arising out of the contract, including, but not
limited to, the prosecution of patent applications, and the
determination of questions of novelty, patentability, and
inventorship.
(r) Educational Awards Subject to 35 U.S.C. 212. The Contractor
shall notify the Contracting Officer prior to the placement of any
person subject to 35 U.S.C. 212 in an area of technology or task (1)
related to exceptional circumstance technology or (2) any person who
is subject to treaties or international agreements as set forth in
paragraph (b)(6) of this clause or to agreements other than funding
agreements. The Contracting Officer may disapprove of any such
placement.
(s) Annual Appraisal by Patent Counsel. Patent Counsel may
conduct an annual appraisal to evaluate the Contractor's
effectiveness in identifying and protecting subject inventions in
accordance with DOE policy.
(t) Publication. The Contractor shall receive approval from
Patent Counsel prior to releasing or publishing information
regarding scientific or technical developments conceived or first
actually reduced to practice in the course of or under this
contract, to ensure such release or publication does not adversely
affect the patent rights of DOE or the Contractor.
(u) Termination of Contractor's Advance Class Waiver. If a
request by the Contractor for an advance class waiver pursuant to
subparagraph (b)(2) of this clause or a determination of
[[Page 81071]]
greater rights pursuant to paragraph (c) of this clause contains
false material statements or fails to disclose material facts, and
DOE relies on the false statements or omissions in granting the
Contractor's request, the waiver or grant of any Government rights
(in whole or in part) to the subject invention(s) may be terminated
at the discretion of the Secretary of Energy or designee. Prior to
termination, DOE shall provide the Contractor with written
notification of the termination, including a statement of facts in
support of the termination, and the Contractor shall be allowed
thirty (30) days, or a longer period authorized by the Secretary of
Energy or designee for good cause shown in writing by the
Contractor, to show cause for not terminating the waiver or grant.
Any termination of an advance class waiver or a determination of
greater rights is subject to the Contractor's license as provided
for in paragraph (f) of this clause.
(End of Clause)
Alternate 1 Weapons Related Subject Inventions. As prescribed at
970.2703-2(g), insert the following as subparagraphs (a)(9)and
(b)(10), respectively:
(a) Definitions. (9) Weapons Related Subject Invention means any
subject invention conceived or first actually reduced to practice in
the course of or under work funded by or through defense programs,
including Department of Defense and intelligence reimbursable work,
or the Naval Nuclear Propulsion Program of the Department of Energy.
(b) Allocation of Principal Rights. (10) Weapons related subject
inventions. Except to the extent that DOE is solely satisfied that
the Contractor meets certain procedural requirements and DOE grants
rights to the Contractor in weapons related subject inventions, the
Contractor does not have a right to retain title to any weapons
related subject inventions.
(End of Alternate)
970.5228-1 Insurance-litigation and claims.
As prescribed in 48 CFR 970.2803-2, insert the following clause:
Insurance--Litigation and Claims (DEC 2000)
(a) The contractor may, with the prior written authorization of
the contracting officer, and shall, upon the request of the
Government, initiate litigation against third parties, including
proceedings before administrative agencies, in connection with this
contract. The contractor shall proceed with such litigation in good
faith and as directed from time to time by the contracting officer.
(b) The contractor shall give the contracting officer immediate
notice in writing of any legal proceeding, including any proceeding
before an administrative agency, filed against the contractor
arising out of the performance of this contract. Except as otherwise
directed by the contracting officer, in writing, the contractor
shall furnish immediately to the contracting officer copies of all
pertinent papers received by the contractor with respect to such
action. The contractor, with the prior written authorization of the
contracting officer, shall proceed with such litigation in good
faith and as directed from time to time by the contracting officer.
(c)(1) Except as provided in paragraph (c)(2) of this clause,
the contractor shall procure and maintain such bonds and insurance
as required by law or approved in writing by the contracting
officer.
(2) The contractor may, with the approval of the contracting
officer, maintain a self-insurance program; provided that, with
respect to workers' compensation, the contractor is qualified
pursuant to statutory authority.
(3) All bonds and insurance required by this clause shall be in
a form and amount and for those periods as the contracting officer
may require or approve and with sureties and insurers approved by
the contracting officer.
(d) The contractor agrees to submit for the contracting
officer's approval, to the extent and in the manner required by the
contracting officer, any other bonds and insurance that are
maintained by the contractor in connection with the performance of
this contract and for which the contractor seeks reimbursement. If
an insurance cost (whether a premium for commercial insurance or
related to self-insurance) includes a portion covering costs made
unallowable elsewhere in the contract, and the share of the cost for
coverage for the unallowable cost is determinable, the portion of
the cost that is otherwise an allowable cost under this contract is
reimbursable to the extent determined by the contracting officer.
(e) Except as provided in subparagraphs (g) and (h) of this
clause, or specifically disallowed elsewhere in this contract, the
contractor shall be reimbursed--
(1) For that portion of the reasonable cost of bonds and
insurance allocable to this contract required in accordance with
contract terms or approved under this clause, and
(2) For liabilities (and reasonable expenses incidental to such
liabilities, including litigation costs) to third persons not
compensated by insurance or otherwise without regard to and as an
exception to the clause of this contract entitled, ``Obligation of
Funds.''
(f) The Government's liability under paragraph (e) of this
clause is subject to the availability of appropriated funds. Nothing
in this contract shall be construed as implying that the Congress
will, at a later date, appropriate funds sufficient to meet
deficiencies.
(g) Notwithstanding any other provision of this contract, the
contractor shall not be reimbursed for liabilities (and expenses
incidental to such liabilities, including litigation costs, counsel
fees, judgment and settlements)--
(1) Which are otherwise unallowable by law or the provisions of
this contract; or
(2) For which the contractor has failed to insure or to maintain
insurance as required by law, this contract, or by the written
direction of the contracting officer.
(h) In addition to the cost reimbursement limitations contained
in 48 CFR Part 31, as supplemented by 48 CFR 970.31, and
notwithstanding any other provision of this contract, the
contractor's liabilities to third persons, including employees but
excluding costs incidental to worker's compensation actions, (and
any expenses incidental to such liabilities, including litigation
costs, counsel fees, judgments and settlements) shall not be
reimbursed if such liabilities were caused by contractor managerial
personnel's--
(1) Willful misconduct,
(2) Lack of good faith, or
(3) Failure to exercise prudent business judgment, which means
failure to act in the same manner as a prudent person in the conduct
of competitive business; or, in the case of a non-profit educational
institution, failure to act in the manner that a prudent person
would under the circumstances prevailing at the time the decision to
incur the cost is made.
(i) The burden of proof shall be upon the contractor to
establish that costs covered by paragraph (h) of this clause are
allowable and reasonable if, after an initial review of the facts,
the contracting officer challenges a specific cost or informs the
contractor that there is reason to believe that the cost results
from willful misconduct, lack of good faith, or failure to exercise
prudent business judgment by contractor managerial personnel.
(j)(1) All litigation costs, including counsel fees, judgments
and settlements shall be differentiated and accounted for by the
contractor so as to be separately identifiable. If the contracting
officer provisionally disallows such costs, then the contractor may
not use funds advanced by DOE under the contract to finance the
litigation.
(2) Punitive damages are not allowable unless the act or failure
to act which gave rise to the liability resulted from compliance
with specific terms and conditions of the contract or written
instructions from the contracting officer.
(3) The portion of the cost of insurance obtained by the
contractor that is allocable to coverage of liabilities referred to
in paragraph (g)(1) of this clause is not allowable.
(4) The term ``contractor's managerial personnel'' is defined in
clause paragraph (j) of 48 CFR 970.5245-1.
(k) The contractor may at its own expense and not as an
allowable cost procure for its own protection insurance to
compensate the contractor for any unallowable or unreimbursable
costs incurred in connection with contract performance.
(l) If any suit or action is filed or any claim is made against
the contractor, the cost and expense of which may be reimbursable to
the contractor under this contract, and the risk of which is then
uninsured or is insured for less than the amount claimed, the
contractor shall--
(1) Immediately notify the contracting officer and promptly
furnish copies of all pertinent papers received;
[[Page 81072]]
(2) Authorize Department representatives to collaborate with:
in-house or DOE-approved outside counsel in settling or defending
the claim; or counsel for the insurance carrier in settling or
defending the claim if the amount of the liability claimed exceeds
the amount of coverage, unless precluded by the terms of the
insurance contract; and
(3) Authorize Department representatives to settle the claim or
to defend or represent the contractor in and/or to take charge of
any litigation, if required by the Department, if the liability is
not insured or covered by bond. In any action against more than one
Department contractor, the Department may require the contractor to
be represented by common counsel. Counsel for the contractor may, at
the contractor's own expense, be associated with the Department
representatives in any such claim or litigation.
(m) Reasonable litigation and other legal expenses are allowable
when incurred in accordance with the DOE approved contractor legal
management procedures (including cost guidelines) as such procedures
may be revised from time to time, and if not otherwise made
unallowable by law or the provisions of this contract.
(End of Clause)
970.5229-1 State and local taxes.
As prescribed in 48 CFR 970.2904-1(b), insert the following clause
in management and operating contracts. The requirement for the notice
prescribed in paragraph (a) of the clause may be broadened to include
all State and local taxes which may be claimed as allowable costs when
considered to be appropriate.
State and Local Taxes (DEC 2000)
(a) The contractor agrees to notify the contracting officer of
any State or local tax, fee, or charge levied or purported to be
levied on or collected from the contractor with respect to the
contract work, any transaction thereunder, or property in the
custody or control of the contractor and constituting an allowable
item of cost if due and payable, but which the contractor has reason
to believe, or the contracting officer has advised the contractor,
is or may be inapplicable or invalid; and the contractor further
agrees to refrain from paying any such tax, fee, or charge unless
authorized in writing by the contracting officer. Any State or local
tax, fee, or charge paid with the approval of the contracting
officer or on the basis of advice from the contracting officer that
such tax, fee, or charge is applicable and valid, and which would
otherwise be an allowable item of cost, shall not be disallowed as
an item of cost by reason of any subsequent ruling or determination
that such tax, fee, or charge was in fact inapplicable or invalid.
(b) The contractor agrees to take such action as may be required
or approved by the contracting officer to cause any State or local
tax, fee, or charge which would be an allowable cost to be paid
under protest; and to take such action as may be required or
approved by the contracting officer to seek recovery of any payments
made, including assignment to the Government or its designee of all
rights to an abatement or refund thereof, and granting permission
for the Government to join with the contractor in any proceedings
for the recovery thereof or to sue for recovery in the name of the
contractor. If the contracting officer directs the contractor to
institute litigation to enjoin the collection of or to recover
payment of any such tax, fee, or charge referred to above, or if a
claim or suit is filed against the contractor for a tax, fee, or
charge it has refrained from paying in accordance with this clause,
the procedures and requirements of the clause entitled ``Insurance-
Litigation and Claims'' shall apply and the costs and expenses
incurred by the contractor shall be allowable items of costs, as
provided in this contract, together with the amount of any judgment
rendered against the contractor.
(c) The Government shall hold the contractor harmless from
penalties and interest incurred through compliance with this clause.
All recoveries or credits in respect of the foregoing taxes, fees,
and charges (including interest) shall inure to and be for the sole
benefit of the Government.
(End of Clause)
970.5231-4 Preexisting conditions.
As prescribed in 48 CFR 970.3170, insert the following clause:
Preexisting Conditions (DEC 2000)
(a) The Department of Energy agrees to reimburse the contractor,
and the contractor shall not be held responsible, for any liability
(including without limitation, a claim involving strict or absolute
liability and any civil fine or penalty), expense, or remediation
cost, but limited to those of a civil nature, which may be incurred
by, imposed on, or asserted against the contractor arising out of
any condition, act, or failure to act which occurred before the
contractor assumed responsibility on [Insert date contract began].
To the extent the acts or omissions of the contractor cause or add
to any liability, expense or remediation cost resulting from
conditions in existence prior to [Insert date contract began], the
contractor shall be responsible in accordance with the terms and
conditions of this contract.
(b) The obligations of the Department of Energy under this
clause are subject to the availability of appropriated funds.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.3170 (a), in
contracts with incumbent management and operating contractors,
substitute the following for paragraph (a) of the basic clause:
(a) Any liability, obligation, loss, damage, claim (including
without limitation, a claim involving strict or absolute liability),
action, suit, civil fine or penalty, cost, expense or disbursement,
which may be incurred or imposed, or asserted by any party and
arising out of any condition, act or failure to act which occurred
before [Insert date this clause was included in contract], in
conjunction with the management and operation of [Insert name of
facility], shall be deemed incurred under Contract No. [Insert
number of prior contract].
Alternate II (DEC 2000). As prescribed in 48 CFR 970.3170 (b),
add the following paragraph (c) to the basic clause in contracts
with management and operating contractors not previously working at
that particular site or facility:
(c) The contractor has the duty to inspect the facilities and
sites and timely identify to the contracting officer those
conditions which it believes could give rise to a liability,
obligation, loss, damage, penalty, fine, claim, action, suit, cost,
expense, or disbursement or areas of actual or potential
noncompliance with the terms and conditions of this contract or
applicable law or regulation. The contractor has the responsibility
to take corrective action, as directed by the contracting officer
and as required elsewhere in this contract.
(End of Clause)
970.5232-1 Reduction or suspension of advance, partial, or progress
payments upon finding of substantial evidence of fraud.
As prescribed in 48 CFR 970.3200-1-1, insert the following clause:
Reduction or Suspension of Advance, Partial, or Progress Payments (DEC
2000)
(a) The contracting officer may reduce or suspend further
advance, partial, or progress payments to the contractor upon a
written determination by the Senior Procurement Executive that
substantial evidence exists that the contractor's request for
advance, partial, or progress payment is based on fraud.
(b) The contractor shall be afforded a reasonable opportunity to
respond in writing.
(End of Clause)
970.5232-2 Payments and advances.
As prescribed in 48 CFR 970.3270(a)(1), insert the following
clause:
Payments and Advances (DEC 2000)
(a) Installments of fixed-fee. The fixed-fee payable under this
contract shall become due and payable in periodic installments in
accordance with a schedule determined by the contracting officer.
Fixed-fee payments shall be made by direct payment or withdrawn from
funds advanced or available under this contract, as determined by
the contracting officer. The contracting officer may offset against
any such fee payment the amounts owed to the Government by the
contractor, including any amounts owed for disallowed costs under
this contract. No fixed-fee payment may be withdrawn against the
payments cleared financing arrangement without prior written
approval of the contracting officer.
(b) Payments on Account of Allowable Costs. The contracting
officer and the contractor shall agree as to the extent to which
payment for allowable costs or payments for other items specifically
approved in writing by the contracting officer (for example,
negotiated fixed amounts) shall be made from advances of Government
funds. When pension contributions are paid by the contractor to the
retirement fund less frequently than quarterly, accrued costs
[[Page 81073]]
therefor shall be excluded from costs for payment purposes until
such costs are paid. If pension contribution are paid on a quarterly
or more frequent basis, accrual therefor may be included in costs
for payment purposes, provided that they are paid to the fund within
30 days after the close of the period covered. If payments are not
made to the fund within such 30-day period, pension contribution
costs shall be excluded from cost for payment purposes until payment
has been made.
(c) Special financial institution account--use. All advances of
Government funds shall be withdrawn pursuant to a payments cleared
financing arrangement prescribed by DOE in favor of the financial
institution or, at the option of the Government, shall be made by
direct payment or other payment mechanism to the contractor, and
shall be deposited only in the special financial institution account
referred to in the Special Financial Institution Account Agreement,
which is incorporated into this contract as Appendix--. No part of
the funds in the special financial institution account shall be
commingled with any funds of the contractor or used for a purpose
other than that of making payments for costs allowable and, if
applicable, fees earned under this contract, negotiated fixed
amounts, or payments for other items specifically approved in
writing by the contracting officer. If the contracting officer
determines that the balance of such special financial institution
account exceeds the contractor's current needs, the contractor shall
promptly make such disposition of the excess as the contracting
officer may direct.
(d) Title to funds advanced. Title to the unexpended balance of
any funds advanced and of any special financial institution account
established pursuant to this clause shall remain in the Government
and be superior to any claim or lien of the financial institution of
deposit or others. It is understood that an advance to the
contractor hereunder is not a loan to the contractor, and will not
require the payment of interest by the contractor, and that the
contractor acquires no right, title or interest in or to such
advance other than the right to make expenditures therefrom, as
provided in this clause.
(e) Financial settlement. The Government shall promptly pay to
the contractor the unpaid balance of allowable costs (or other items
specifically approved in writing by the contracting officer) and fee
upon termination of the work, expiration of the term of the
contract, or completion of the work and its acceptance by the
Government after:
(1) Compliance by the contractor with DOE's patent clearance
requirements, and
(2) The furnishing by the contractor of:
(i) An assignment of the contractor's rights to any refunds,
rebates, allowances, accounts receivable, collections accruing to
the contractor in connection with the work under this contract, or
other credits applicable to allowable costs under the contract;
(ii) A closing financial statement;
(iii) The accounting for Government-owned property required by
the clause entitled ``Property''; and
(iv) A release discharging the Government, its officers, agents,
and employees from all liabilities, obligations, and claims arising
out of or under this contract subject only to the following
exceptions:
(A) Specified claims in stated amounts or in estimated amounts
where the amounts are not susceptible to exact statement by the
contractor;
(B) Claims, together with reasonable expenses incidental
thereto, based upon liabilities of the contractor to third parties
arising out of the performance of this contract; provided that such
claims are not known to the contractor on the date of the execution
of the release; and provided further that the contractor gives
notice of such claims in writing to the contracting officer
promptly, but not more than one (1) year after the contractor's
right of action first accrues. In addition, the contractor shall
provide prompt notice to the contracting officer of all potential
claims under this clause, whether in litigation or not (see also
Contract Clause____, DEAR 970.5228-1, ``Insurance--Litigation and
Claims'');
(C) Claims for reimbursement of costs (other than expenses of
the contractor by reason of any indemnification of the Government
against patent liability), including reasonable expenses incidental
thereto, incurred by the contractor under the provisions of this
contract relating to patents; and
(D) Claims recognizable under the clause entitled, Nuclear
Hazards Indemnity Agreement.
(3) In arriving at the amount due the contractor under this
clause, there shall be deducted,
(i) Any claim which the Government may have against the
contractor in connection with this contract, and
(ii) Deductions due under the terms of this contract, and not
otherwise recovered by or credited to the Government. The
unliquidated balance of the special financial institution account
may be applied to the amount due and any balance shall be returned
to the Government forthwith.
(f) Claims. Claims for credit against funds advanced for payment
shall be accompanied by such supporting documents and justification
as the contracting officer shall prescribe.
(g) Discounts. The contractor shall take and afford the
Government the advantage of all known and available cash and trade
discounts, rebates, allowances, credits, salvage, and commissions
unless the contracting officer finds that action is not in the best
interest of the Government.
(h) Collections. All collections accruing to the contractor in
connection with the work under this contract, except for the
contractor's fee and royalties or other income accruing to the
contractor from technology transfer activities in accordance with
this contract, shall be Government property and shall be processed
and accounted for in accordance with applicable requirements imposed
by the contracting officer pursuant to the Laws, regulations, and
DOE directives clause of this contract and, to the extent consistent
with those requirements, shall be deposited in the special financial
institution account or otherwise made available for payment of
allowable costs under this contract, unless otherwise directed by
the contracting officer.
(i) Direct payment of charges. The Government reserves the
right, upon ten days written notice from the contracting officer to
the contractor, to pay directly to the persons concerned, all
amounts due which otherwise would be allowable under this contract.
Any payment so made shall discharge the Government of all liability
to the contractor therefor.
(j) Determining allowable costs. The contracting officer shall
determine allowable costs in accordance with the Federal Acquisition
Regulation subpart 31.2 and the Department of Energy Acquisition
Regulation subpart 48 CFR 970.31 in effect on the date of this
contract and other provisions of this contract.
Alternate I (DEC 2000). As prescribed in 48 CFR
970.3270(a)(1)(i), if a separate fixed-fee is provided for a
separate item of work, paragraph (a) of the basic clause should be
modified to permit payment of the entire fixed-fee upon completion
of that item.
Alternate II (DEC 2000). As prescribed in 48 CFR
970.3270(a)(1)(ii), when total available fee provisions are used,
replace paragraph (a) of the basic clause with the following
paragraph (a):
(a) Payment of Total available fee: Base Fee and Performance
Fee. The base fee amount, if any, is payable in equal monthly
installments. Total available fee amount earned is payable following
the Government's Determination of Total Available Fee Amount Earned
in accordance with the clause of this contract entitled ``Total
Available Fee: Base Fee Amount and Performance Fee Amount.'' Base
fee amount and total available fee amount earned payments shall be
made by direct payment or withdrawn from funds advanced or available
under this contract, as determined by the contracting officer. The
contracting officer may offset against any such fee payment the
amounts owed to the Government by the contractor, including any
amounts owed for disallowed costs under this contract. No base fee
amount or total available fee amount earned payment may be withdrawn
against the payments cleared financing arrangement without the prior
written approval of the contracting officer.
Alternate III (DEC 2000). As prescribed in 48 CFR
970.3270(a)(1)(iii), the following paragraph (k) shall be included
in management and operating contracts with integrated accounting
systems:
(k) Review and approval of costs incurred. The contractor shall
prepare and submit annually as of September 30, a ``Statement of
Costs Incurred and Claimed'' (Cost Statement) for the total of net
expenditures accrued (i.e., net costs incurred) for the period
covered by the Cost Statement. The contractor shall certify the Cost
Statement subject to the penalty provisions for unallowable costs as
stated in sections 306(b) and (i) of the Federal Property and
Administrative Services Act of 1949 (41 U.S.C. 256), as amended.
DOE, after audit and appropriate adjustment, will approve such Cost
Statement. This approval by DOE will constitute an acknowledgment by
DOE that the net costs incurred are allowable
[[Page 81074]]
under the contract and that they have been recorded in the accounts
maintained by the contractor in accordance with DOE accounting
policies, but will not relieve the contractor of responsibility for
DOE's assets in its care, for appropriate subsequent adjustments, or
for errors later becoming known to DOE.
Alternate IV (DEC 2000). As prescribed in 48 CFR
970.3270(a)(1)(iv), the following paragraph (k) shall be included in
management and operating contracts without integrated accounting
systems:
(k) Certification and penalties. The contractor shall prepare
and submit a ``Statement of Costs Incurred and Claimed'' (Cost
Statement) for the total of net expenditures incurred for the period
covered by the Cost Statement. It is anticipated that this will be
an annual submission unless otherwise agreed to by the contracting
officer. The contractor shall certify the Cost Statement subject to
the penalty provisions for unallowable costs as stated in sections
306(b) and (i) of the Federal Property and Administrative Services
Act of 1949 (41 U.S.C. 256), as amended.
970.5232-3 Accounts, records, and inspection.
As prescribed in 48 CFR 970.3270(a)(2), insert the following
clause:
Accounts, Records, and Inspection (DEC 2000)
(a) Accounts. The contractor shall maintain a separate and
distinct set of accounts, records, documents, and other evidence
showing and supporting: all allowable costs incurred; collections
accruing to the contractor in connection with the work under this
contract, other applicable credits, negotiated fixed amounts, and
fee accruals under this contract; and the receipt, use, and
disposition of all Government property coming into the possession of
the contractor under this contract. The system of accounts employed
by the contractor shall be satisfactory to DOE and in accordance
with generally accepted accounting principles consistently applied.
(b) Inspection and audit of accounts and records. All books of
account and records relating to this contract shall be subject to
inspection and audit by DOE or its designees in accordance with the
provisions of Clause ____, Access to and ownership of records, at
all reasonable times, before and during the period of retention
provided for in paragraph (d) of this clause, and the contractor
shall afford DOE proper facilities for such inspection and audit.
(c) Audit of subcontractors' records. The contractor also
agrees, with respect to any subcontracts (including fixed-price or
unit-price subcontracts or purchase orders) where, under the terms
of the subcontract, costs incurred are a factor in determining the
amount payable to the subcontractor of any tier, to either conduct
an audit of the subcontractor's costs or arrange for such an audit
to be performed by the cognizant government audit agency through the
contracting officer.
(d) Disposition of records. Except as agreed upon by the
Government and the contractor, all financial and cost reports, books
of account and supporting documents, system files, data bases, and
other data evidencing costs allowable, collections accruing to the
contractor in connection with the work under this contract, other
applicable credits, and fee accruals under this contract, shall be
the property of the Government, and shall be delivered to the
Government or otherwise disposed of by the contractor either as the
contracting officer may from time to time direct during the progress
of the work or, in any event, as the contracting officer shall
direct upon completion or termination of this contract and final
audit of accounts hereunder. Except as otherwise provided in this
contract, including provisions of Clause____, Access to and
ownership of records, all other records in the possession of the
contractor relating to this contract shall be preserved by the
contractor for a period of three years after final payment under
this contract or otherwise disposed of in such manner as may be
agreed upon by the Government and the contractor.
(e) Reports. The contractor shall furnish such progress reports
and schedules, financial and cost reports, and other reports
concerning the work under this contract as the contracting officer
may from time to time require.
(f) Inspections. The DOE shall have the right to inspect the
work and activities of the contractor under this contract at such
time and in such manner as it shall deem appropriate.
(g) Subcontracts. The contractor further agrees to require the
inclusion of provisions similar to those in paragraphs (a) through
(g) and paragraph (h) of this clause in all subcontracts (including
fixed-price or unit-price subcontracts or purchase orders) of any
tier entered into hereunder where, under the terms of the
subcontract, costs incurred are a factor in determining the amount
payable to the subcontractor.
(h) Comptroller General. (1) The Comptroller General of the
United States, or an authorized representative, shall have access to
and the right to examine any of the contractor's directly pertinent
records involving transactions related to this contract or a
subcontract hereunder.
(2) This paragraph may not be construed to require the
contractor or subcontractor to create or maintain any record that
the contractor or subcontractor does not maintain in the ordinary
course of business or pursuant to a provision of law.
(3) Nothing in this contract shall be deemed to preclude an
audit by the General Accounting Office of any transaction under this
contract.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR
970.3270(a)(2)(i), if the contract includes the clause at 48 CFR
52.215-11, Price Reduction for Defective Cost or Pricing Data, the
basic clause shall be modified as follows:
(a) Paragraph (a) of the basic clause shall be modified by
adding the words ``or anticipated to be incurred'' after the words
``allowable costs incurred.''
(b) Paragraph (g) of the basic clause shall be modified by
adding the following:
The contractor further agrees to include an ``Audit'' clause,
the substance of which is the ``Audit'' clause set forth at 48 CFR
52.215-2, in each subcontract which does not include provisions
similar to those in paragraph (a) through paragraph (g) and
paragraph (h) of this clause, but which contains a ``defective cost
or pricing data'' clause.
Alternate II (DEC 2000). As prescribed in 48 CFR
970.3270(a)(2)(ii), in cost-reimbursement contracts involving an
estimated cost exceeding $5 million and expected to run for more
than 2 years, and any other cost-reimbursement contract determined
by the Head of the Contracting Activity in which the contractor has
an established internal audit organization, add the following
paragraph (i) to the basic clause:
(i) Internal audit. The contractor agrees to conduct an internal
audit and examination satisfactory to DOE of the records,
operations, expenses, and the transactions with respect to costs
claimed to be allowable under this contract annually and at such
other times as may be mutually agreed upon. The results of such
audit, including the working papers, shall be submitted or made
available to the contracting officer. The contractor shall include
this paragraph (i) in all cost-reimbursement subcontracts with an
estimated cost exceeding $5 million and expected to run for more
than 2 years, and any other cost-reimbursement subcontract
determined by the Head of the Contracting Activity.
970.5232-4 Obligation of funds.
As prescribed in 48 CFR 970.3270(a)(3), insert the following
clause:
Obligation of Funds (DEC 2000)
(a) Obligation of funds. The amount presently obligated by the
Government with respect to this contract is ____ dollars ($____).
Such amount may be increased unilaterally by DOE by written notice
to the contractor and may be increased or decreased by written
agreement of the parties (whether or not by formal modification of
this contract). Estimated collections from others for work and
services to be performed under this contract are not included in the
amount presently obligated. Such collections, to the extent actually
received by the contractor, shall be processed and accounted for in
accordance with applicable requirements imposed by the contracting
officer pursuant to the Laws, regulations, and DOE directives clause
of this contract. Nothing in this paragraph is to be construed as
authorizing the contractor to exceed limitations stated in financial
plans established by DOE and furnished to the contractor from time
to time under this contract.
(b) Limitation on payment by the Government. Except as otherwise
provided in this contract and except for costs which may be incurred
by the contractor pursuant to the Termination clause of this
contract or costs of claims allowable under the contract occurring
after completion or termination and not released by the contractor
at the time of financial settlement of the contract in
[[Page 81075]]
accordance with the clause entitled ``Payments and Advances,''
payment by the Government under this contract on account of
allowable costs shall not, in the aggregate, exceed the amount
obligated with respect to this contract, less the contractor's fee
and any negotiated fixed amount. Unless expressly negated in this
contract, payment on account of those costs excepted in the
preceding sentence which are in excess of the amount obligated with
respect to this contract shall be subject to the availability of:
(1) collections accruing to the contractor in connection with
the work under this contract and processed and accounted for in
accordance with applicable requirements imposed by the contracting
officer pursuant to the Laws, regulations, and DOE directives clause
of this contract, and
(2) other funds which DOE may legally use for such purpose,
provided DOE will use its best efforts to obtain the appropriation
of funds for this purpose if not otherwise available.
(c) Notices--Contractor excused from further performance. The
contractor shall notify DOE in writing whenever the unexpended
balance of available funds (including collections available under
paragraph (a) of this clause), plus the contractor's best estimate
of collections to be received and available during the ____ day
period hereinafter specified, is in the contractor's best judgment
sufficient to continue contract operations at the programmed rate
for only ____ days and to cover the contractor's unpaid fee and any
negotiated fixed amounts, and outstanding encumbrances and
liabilities on account of costs allowable under the contract at the
end of such period. Whenever the unexpended balance of available
funds (including collections available under paragraph (a) of this
clause), less the amount of the contractor's fee then earned but not
paid and any negotiated fixed amounts, is in the contractor's best
judgment sufficient only to liquidate outstanding encumbrances and
liabilities on account of costs allowable under this contract, the
contractor shall immediately notify DOE and shall make no further
encumbrances or expenditures (except to liquidate existing
encumbrances and liabilities), and, unless the parties otherwise
agree, the contractor shall be excused from further performance
(except such performance as may become necessary in connection with
termination by the Government) and the performance of all work
hereunder will be deemed to have been terminated for the convenience
of the Government in accordance with the provisions of the
Termination clause of this contract.
(d) Financial plans; cost and encumbrance limitations. In
addition to the limitations provided for elsewhere in this contract,
DOE may, through financial plans, such as Approved Funding Programs,
or other directives issued to the contractor, establish controls on
the costs to be incurred and encumbrances to be made in the
performance of the contract work. Such plans and directives may be
amended or supplemented from time to time by DOE. The contractor
agrees
(1) to comply with the specific limitations (ceilings) on costs
and encumbrances set forth in such plans and directives,
(2) to comply with other requirements of such plans and
directives, and
(3) to notify DOE promptly, in writing, whenever it has reason
to believe that any limitation on costs and encumbrances will be
exceeded or substantially underrun.
(e) Government's right to terminate not affected. The giving of
any notice under this clause shall not be construed to waive or
impair any right of the Government to terminate the contract under
the provisions of the Termination clause of this contract.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR
970.3270(a)(3)(i), paragraph (d) of the clause may be omitted in
contracts which, expressly or otherwise, provide a contractual basis
for equivalent controls in a separate clause.
970.5232-5 Liability with respect to cost accounting standards.
As prescribed in 48 CFR 970.3270(a)(5), insert the following
clause:
Liability With Respect to Cost Accounting Standards (DEC 2000)
(a) The contractor is not liable to the Government for increased
costs or interest resulting from its failure to comply with the
clauses of this contract entitled, ``Cost Accounting Standards,''
and ``Administration of Cost Accounting Standards,'' if its failure
to comply with the clauses is caused by the contractor's compliance
with published DOE financial management policies and procedures or
other requirements established by the Department's Chief Financial
Officer or Procurement Executive.
(b) The contractor is not liable to the Government for increased
costs or interest resulting from its subcontractors' failure to
comply with the clauses at FAR 52.230-2, ``Cost Accounting
Standards,'' and FAR 52.230-6, ``Administration of Cost Accounting
Standards,'' if the contractor includes in each covered subcontract
a clause making the subcontractor liable to the Government for
increased costs or interest resulting from the subcontractor's
failure to comply with the clauses; and the contractor seeks the
subcontract price adjustment and cooperates with the Government in
the Government's attempts to recover from the subcontractor.
970.5232-6 Work for others funding authorization.
As prescribed in 48 CFR 970.3270(a)(6), insert the following
clause:
Work for Others Funding Authorization (DEC 2000)
Any uncollectible receivables resulting from the contractor
utilizing contractor corporate funding for reimbursable work shall
be the responsibility of the contractor, and the United States
Government shall have no liability to the contractor for the
contractor's uncollected receivables. The contractor is permitted to
provide advance payment utilizing contractor corporate funds for
reimbursable work to be performed by the contractor for a non-
Federal entity in instances where advance payment from that entity
is required under the Laws, regulations, and DOE directives clause
of this contract and such advance cannot be obtained. The contractor
is also permitted to provide advance payment utilizing contractor
corporate funds to continue reimbursable work to be performed by the
contractor for a Federal entity when the term or the funds on a
Federal interagency agreement required under the Laws, regulations,
and DOE directives clause of this contract have elapsed. The
contractor's utilization of contractor corporate funds does not
relieve the contractor of its responsibility to comply with all
requirements for Work for Others applicable to this contract.
970.5232-7 Financial management system.
As prescribed in 48 CFR 970.3270(b)(1), insert the following
clause:
Financial Management System (DEC 2000)
The contractor shall maintain and administer a financial
management system that is suitable to provide proper accounting in
accordance with DOE requirements for assets, liabilities,
collections accruing to the contractor in connection with the work
under this contract, expenditures, costs, and encumbrances; permits
the preparation of accounts and accurate, reliable financial and
statistical reports; and assures that accountability for the assets
can be maintained. The contractor shall submit to DOE for written
approval an annual plan for new financial management systems and/or
subsystems and major enhancements and/or upgrades to the currently
existing financial systems and/or subsystems. The contractor shall
notify DOE thirty (30) days in advance of any planned implementation
of any substantial deviation from this plan and, as requested by the
contracting officer, shall submit any such deviation to DOE for
written approval before implementation.
970.5232-8 Integrated accounting.
As prescribed in 48 CFR 970.3270(b)(2), insert the following
clause:
Integrated Accounting (DEC 2000)
Integrated accounting procedures are required for use under this
contract. The contractor's financial management system shall include
an integrated accounting system that is linked to DOE's accounts
through the use of reciprocal accounts and that has electronic
capability to transmit monthly and year-end self-balancing trial
balances to the Department's Primary Accounting System for reporting
financial activity under this contract in accordance with
requirements imposed by the contracting officer pursuant to the
Laws, regulations, and DOE directives clause of this contract.
[[Page 81076]]
970.5235-1 Federally funded research and development center sponsoring
agreement.
As prescribed in 48 CFR 970.3501-4, the contracting officer shall
insert the following clause:
Federally Funded Research and Development Center Sponsoring Agreement
(DEC 2000)
(a) Pursuant to 48 CFR 35.017-1, this contract constitutes the
sponsoring agreement between the Department of Energy and the
contractor, which establishes the relationship for the operation of
a Department of Energy sponsored Federally Funded Research and
Development Center (FFRDC).
(b) In the operation of this FFRDC, the contractor may be
provided access beyond that which is common to the normal
contractual relationship, to Government and supplier data, including
sensitive and proprietary data, and to Government employees and
facilities needed to discharge its responsibilities efficiently and
effectively. Because of this special relationship, it is essential
that the FFRDC be operated in the public interest with objectivity
and independence, be free from organizational conflicts of interest,
and have full disclosure of its affairs to the Department of Energy.
(c) Unless otherwise provided by the contract, the contractor
may accept work from a nonsponsor (as defined in 48 CFR 35.017) in
accordance with the requirements and limitations of DOE Order 481.1,
Work for Others (Non-Department of Energy Funded Work) (see current
version).
(d) As an FFRDC, the contractor shall not use its privileged
information or access to government facilities to compete with the
private sector. Specific guidance on restricted activities is
contained in DOE Order 481.1.
(End of Clause)
970.5236-1 Government facility subcontract approval.
As prescribed in 48 CFR 970.3605-2, insert the following clause:
Government Facility Subcontract Approval (DEC 2000)
Upon request of the contracting officer and acceptance thereof
by the contractor, the contractor shall procure, by subcontract, the
construction of new facilities or the alteration or repair of
Government-owned facilities at the plant. Any subcontract entered
into under this paragraph shall be subject to the written approval
of the contracting officer and shall contain the provisions relative
to labor and wages required by law to be included in contracts for
the construction, alteration, and/or repair, including painting and
decorating, of a public building or public work.
(End of Clause)
970.5237-2 Facilities management.
As prescribed in 48 CFR 970.3770-2, insert the following clause:
Facilities Management (DEC 2000)
Copies of DOE Directives referenced herein are available from
the contracting officer.
(a) Site development planning. The Government shall provide to
the contractor site development guidance for the facilities and
lands for which the contractor is responsible under the terms and
conditions of this contract. Based upon this guidance, the
contractor shall prepare, and maintain through annual updates, a
Long-Range Site Development Plan (Plan) to reflect those actions
necessary to keep the development of these facilities current with
the needs of the Government and allow the contractor to successfully
accomplish the work required under this contract. In developing this
Plan, the contractor shall follow the procedural guidance set forth
in the applicable DOE Directives in the Life Cycle Facility
Operations Series listed elsewhere in this contract. The contractor
shall use the Plan to manage and control the development of
facilities and lands. All plans and revisions shall be approved by
the Government.
(b) General design criteria. The general design criteria which
shall be utilized by the contractor in managing the site for which
it is responsible under this contract are those specified in the
applicable DOE Directives in the 6430, Design Criteria, series
listed elsewhere in this contract. The contractor shall comply with
these mandatory, minimally acceptable requirements for all facility
designs with regard to any building acquisition, new facility,
facility addition or alteration or facility lease undertaken as part
of the site development activities of paragraph (a) of this clause.
This includes on-site constructed buildings, pre-engineered
buildings, plan-fabricated modular buildings, and temporary
facilities. For existing facilities, original design criteria apply
to the structure in general; however, additions or modifications
shall comply with this directive and the associated latest editions
of the references therein. An exception may be granted for off-site
office space being leased by the contractor on a temporary basis.
(c) Energy management. The contractor shall manage the
facilities for which it is responsible under the terms and
conditions of this contract in an energy efficient manner in
accordance with the applicable DOE Directives in the Life Cycle
Facility Operations Series listed elsewhere in this contract. The
contractor shall develop a 10-year energy management plan for each
site with annual reviews and revisions. The contractor shall submit
an annual report on progress toward achieving the goals of the 10-
year plan for each individual site, and an energy conservation
analysis report for each new building or building addition project.
Any acquisition of utility services by the contractor shall be
conducted in accordance with 48 CFR 970.41.
(d) Subcontract Requirements. To the extent the contractor
subcontracts performance of any of the responsibilities discussed in
this clause, the subcontract shall contain the requirements of this
clause relative to the subcontracted responsibilities.
(End of Clause)
970.5242-1 Penalties for unallowable costs.
As prescribed in 48 CFR 970.4207-03-70, insert the following
clause:
Penalties for Unallowable Costs (DEC 2000)
(a) Contractors which include unallowable cost in a submission
for settlement for cost incurred, may be subject to penalties.
(b) If, during the review of a submission for settlement of cost
incurred, the contracting officer determines that the submission
contains an expressly unallowable cost or a cost determined to be
unallowable prior to the submission, the contracting officer shall
assess a penalty.
(c) Unallowable costs are either expressly unallowable or
determined unallowable.
(1) An expressly unallowable cost is a particular item or type
of cost which, under the express provisions of an applicable law,
regulation, or this contract, is specifically named and stated to be
unallowable.
(2) A cost determined unallowable is one which, for that
contractor,
(i) was subject to a contracting officer's final decision and
not appealed;
(ii) the Department's Board of Contract Appeals or a court has
previously ruled as unallowable; or
(iii) was mutually agreed to be unallowable.
(d) If the contracting officer determines that a cost submitted
by the contractor in its submission for settlement of cost incurred
is:
(1) expressly unallowable, then the contracting officer shall
assess a penalty in an amount equal to the disallowed cost allocated
to this contract plus interest on the paid portion of the disallowed
cost. Interest shall be computed from the date of overpayment to the
date of repayment using the interest rate specified by the Secretary
of the Treasury pursuant to Pub. L. 92-41 (85 Stat. 97); or
(2) determined unallowable, then the contracting officer shall
assess a penalty in an amount equal to two times the amount of the
disallowed cost allocated to this contract.
(e) The contracting officer may waive the penalty provisions
when
(1) the contractor withdraws the submission before the formal
initiation of an audit of the submission and submits a revised
submission;
(2) the amount of the unallowable costs allocated to covered
contracts is $10,000 or less; or
(3) the contractor demonstrates to the contracting officer's
satisfaction that:
(i) it has established appropriate policies, personnel training,
and an internal control and review system that provides assurances
that unallowable costs subject to penalties are precluded from the
contractor's submission for settlement of costs; and
(ii) the unallowable costs subject to the penalty were
inadvertently incorporated into the submission.
(End of clause)
970.5243-1 Changes.
As prescribed in 48 CFR 970.4302-1, the contracting officer shall
insert the following clause in all management and operating contracts:
Changes (DEC 2000)
(a) Changes and adjustment of fee. The contracting officer may
at any time and
[[Page 81077]]
without notice to the sureties, if any, issue written directions
within the general scope of this contract requiring additional work
or directing the omission of, or variation in, work covered by this
contract. If any such direction results in a material change in the
amount or character of the work described in the ``Statement of
Work,'' an equitable adjustment of the fee, if any, shall be made in
accordance with the agreement of the parties and the contract shall
be modified in writing accordingly. Any claim by the contractor for
an adjustment under this clause must be asserted in writing within
30 days from the date of receipt by the contractor of the
notification of change; provided, however, that the contracting
officer, if it is determined that the facts justify such action, may
receive and act upon any such claim asserted at any time prior to
final payment under this contract. A failure to agree on an
equitable adjustment under this clause shall be deemed to be a
dispute within the meaning of the clause entitled ``Disputes.''
(b) Work to continue. Nothing contained in this clause shall
excuse the contractor from proceeding with the prosecution of the
work in accordance with the requirements of any direction hereunder.
(End of Clause)
970.5244-1 Contractor purchasing system.
As prescribed in 48 CFR 970.4402-5, insert the following clause:
Contractor Purchasing System (DEC 2000)
(a) General. The contractor shall develop, implement, and
maintain formal policies, practices, and procedures to be used in
the award of subcontracts consistent with this clause and 48 CFR
970.44. The contractor's purchasing system and methods shall be
fully documented, consistently applied, and acceptable to DOE in
accordance with 48 CFR 970.4401-1. The contractor shall maintain
file documentation which is appropriate to the value of the purchase
and is adequate to establish the propriety of the transaction and
the price paid. The contractor's purchasing performance will be
evaluated against such performance criteria and measures as may be
set forth elsewhere in this contract. DOE reserves the right at any
time to require that the contractor submit for approval any or all
purchases under this contract. The contractor shall not purchase any
item or service the purchase of which is expressly prohibited by the
written direction of DOE and shall use such special and directed
sources as may be expressly required by the DOE contracting officer.
DOE will conduct periodic appraisals of the contractor's management
of all facets of the purchasing function, including the contractor's
compliance with its approved system and methods. Such appraisals
will be performed through the conduct of Contractor Purchasing
System Reviews in accordance with 48 CFR subpart 44.3, or, when
approved by the contracting officer, through the contractor's
participation in the conduct of the Balanced Scorecard performance
measurement and performance management system. The contractor's
approved purchasing system and methods shall include the
requirements set forth in paragraphs (b) through (x) of this clause.
(b) Acquisition of utility services. Utility services shall be
acquired in accordance with the requirements of 48 CFR 970.41.
(c) Acquisition of Real Property. Real property shall be
acquired in accordance with 48 CFR Subpart 917.74.
(d) Advance Notice of Proposed Subcontract Awards. Advance
notice shall be provided in accordance with 48 CFR 970.4401-3.
(e) Audit of Subcontractors. (1) The contractor shall provide
for:
(i) periodic post-award audit of cost-reimbursement
subcontractors at all tiers, and
(ii) audits, where necessary, to provide a valid basis for pre-
award or cost or price analysis.
(2) Responsibility for determining the costs allowable under
each cost-reimbursement subcontract remains with the contractor or
next higher-tier subcontractor. The contractor shall provide, in
appropriate cases, for the timely involvement of the contractor and
the DOE contracting officer in resolution of subcontract cost
allowability.
(3) Where audits of subcontractors at any tier are required,
arrangements may be made to have the cognizant Federal agency
perform the audit of the subcontract. These arrangements shall be
made administratively between DOE and the other agency involved and
shall provide for the cognizant agency to audit in an appropriate
manner in light of the magnitude and nature of the subcontract. In
no case, however, shall these arrangements preclude determination by
the DOE contracting officer of the allowability or unallowability of
subcontractor costs claimed for reimbursement by the contractor.
(4) Allowable costs for cost reimbursable subcontracts are to be
determined in accordance with the cost principles of 48 CFR Part 31,
appropriate for the type of organization to which the subcontract is
to be awarded, as supplemented by 48 CFR Part 931. Allowable costs
in the purchase or transfer from contractor-affiliated sources shall
be determined in accordance with 48 CFR 970.4402-3 and 48 CFR
970.3102-3-21(b).
(f) Bonds and Insurance. (1) The contractor shall require
performance bonds in penal amounts as set forth in 48 CFR 28.102-
2(a) for all fixed priced and unit-priced construction subcontracts
in excess of $100,000. The contractor shall consider the use of
performance bonds in fixed price nonconstruction subcontracts, where
appropriate.
(2) For fixed-price, unit-priced and cost reimbursement
construction subcontracts in excess of $100,000 a payment bond shall
be obtained on Standard Form 25A modified to name the contractor as
well as the United States of America as obligees. The penal amounts
shall be determined in accordance with 48 CFR 28.102-2(b).
(3) For fixed-price, unit-priced and cost-reimbursement
construction subcontracts, greater than $25,000, but not greater
than $100,000, the contractor shall select two or more of the
payment protections at 48 CFR 28.102-1(b), giving particular
consideration to the inclusion of an irrevocable letter of credit as
one of the selected alternatives.
(4) A subcontractor may have more than one acceptable surety in
both construction and other subcontracts, provided that in no case
will the liability of any one surety exceed the maximum penal sum
for which it is qualified for any one obligation. For subcontracts
other than construction, a co-surety (two or more sureties together)
may reinsure amounts in excess of their individual capacity, with
each surety having the required underwriting capacity that appears
on the list of acceptable corporate sureties.
(g) Buy American. The contractor shall comply with the
provisions of the Buy American Act as reflected in 48 CFR 52.225-3
and 48 CFR 52.225-5. The contractor shall forward determinations of
nonavailability of individual items to the DOE contracting officer
for approval. Items in excess of $100,000 require the prior
concurrence of the Head of Contracting Activity. If, however, the
contractor has an approved purchasing system, the Head of the
Contracting Activity may authorize the contractor to make
determinations of nonavailability for individual items valued at
$100,000 or less.
(h) Construction and Architect-Engineer Subcontracts. (1)
Independent Estimates. A detailed, independent estimate of costs
shall be prepared for all construction work to be subcontracted.
(2) Specifications. Specifications for construction shall be
prepared in accordance with the DOE publication entitled ``General
Design Criteria Manual.''
(3) Prevention of Conflict of Interest. (i) The contractor shall
not award a subcontract for construction to the architect-engineer
firm or an affiliate that prepared the design. This prohibition does
not preclude the award of a ``turnkey'' subcontract so long as the
subcontractor assumes all liability for defects in design and
construction and consequential damages.
(ii) The contractor shall not award both a cost-reimbursement
subcontract and a fixed-price subcontract for construction or
architect-engineer services or any combination thereof to the same
firm where those subcontracts will be performed at the same site.
(iii) The contractor shall not employ the construction
subcontractor or an affiliate to inspect the firm's work. The
contractor shall assure that the working relationships of the
construction subcontractor and the subcontractor inspecting its work
and the authority of the inspector are clearly defined.
(i) Contractor-Affiliated Sources. Equipment, materials,
supplies, or services from a contractor-affiliated source shall be
purchased or transferred in accordance with 48 CFR 970.4402-3.
(j) Contractor-Subcontractor Relationship. The obligations of
the contractor under paragraph (a) of this clause, including the
development of the purchasing system and methods, and purchases made
pursuant thereto, shall not relieve the contractor of any obligation
under this contract (including, among other things, the obligation
to properly supervise, administer, and
[[Page 81078]]
coordinate the work of subcontractors). Subcontracts shall be in the
name of the contractor, and shall not bind or purport to bind the
Government.
(k) Government Property. Identification, inspection,
maintenance, protection, and disposition of Government property
shall conform with the policies and principles of 48 CFR Part 45, 48
CFR 945, the Federal Property Management Regulations 41 CFR Chapter
101, the DOE Property Management Regulations 41 CFR Chapter 109, and
their contracts.
(l) Indemnification. Except for Price-Anderson Nuclear Hazards
Indemnity, no subcontractor may be indemnified except with the prior
approval of the Senior Procurement Executive.
(m) Leasing of Motor Vehicles. Contractors shall comply with 48
CFR 8.11 and 48 CFR 908.11.
(n) Make-or-Buy Plans. Acquisition of property and services
shall be obtained on a least-cost basis, consistent with the
requirements of the ``Make-or-Buy Plan'' clause of this contract and
the contractor's approved make-or-buy plan.
(o) Management, Acquisition and Use of Information Resources.
Requirements for automatic data processing resources and
telecommunications facilities, services, and equipment, shall be
reviewed and approved in accordance with applicable DOE Orders and
regulations regarding information resources.
(p) Priorities, Allocations and Allotments. Priorities,
allocations and allotments shall be extended to appropriate
subcontracts in accordance with the clause or clauses of this
contract dealing with priorities and allocations.
(q) Purchase of Special Items. Purchase of the following items
shall be in accordance with the following provisions of 48 CFR
908.71 and the Federal Property Management Regulations, 41 CFR
Chapter 101:
(1) Motor vehicles--48 CFR 908.7101
(2) Aircraft--48 CFR 908.7102
(3) Security Cabinets--48 CFR 908.7106
(4) Alcohol--48 CFR 908.7107
(5) Helium--48 CFR 908.7108
(6) Fuels and packaged petroleum products--48 CFR 908.7109
(7) Coal--48 CFR 908.7110
(8) Arms and Ammunition--48 CFR 908.7111
(9) Heavy Water--48 CFR 908.7121(a)
(10) Precious Metals--48 CFR 908.7121(b)
(11) Lithium--48 CFR 908.7121(c)
(12) Products and services of the blind and severely
handicapped--41 CFR 101-26.701
(13) Products made in Federal penal and correctional
institutions--41 CFR 101-26.702
(r) Purchase vs. Lease Determinations. Contractors shall
determine whether required equipment and property should be
purchased or leased, and establish appropriate thresholds for
application of lease vs. purchase determinations. Such
determinations shall be made:
(1) at time of original acquisition;
(2) when lease renewals are being considered; and
(3) at other times as circumstances warrant.
(s) Quality Assurance. Contractors shall provide no less
protection for the Government in its subcontracts than is provided
in the prime contract.
(t) Setoff of Assigned Subcontractor Proceeds. Where a
subcontractor has been permitted to assign payments to a financial
institution, the assignment shall treat any right of setoff in
accordance with 48 CFR 932.803.
(u) Strategic and Critical Materials. The contractor may use
strategic and critical materials in the National Defense Stockpile.
(v) Termination. When subcontracts are terminated as a result of
the termination of all or a portion of this contract, the contractor
shall settle with subcontractors in conformity with the policies and
principles relating to settlement of prime contracts in 48 CFR
Subparts 49.1, 49.2 and 49.3. When subcontracts are terminated for
reasons other than termination of this contract, the contractor
shall settle such subcontracts in general conformity with the
policies and principles in 48 CFR Subparts 49.1, 49.2, 49.3 and
49.4. Each such termination shall be documented and consistent with
the terms of this contract. Terminations which require approval by
the Government shall be supported by accounting data and other
information as may be directed by the contracting officer.
(w) Unclassified Controlled Nuclear Information. Subcontracts
involving unclassified uncontrolled nuclear information shall be
treated in accordance with 10 CFR part 1017.
(x) Subcontract Flowdown Requirements. In addition to terms and
conditions that are included in the prime contract which direct
application of such terms and conditions in appropriate
subcontracts, the contractor shall include the following clauses in
subcontracts, as applicable:
(1) Davis-Bacon clauses prescribed in 48 CFR 22.407.
(2) Foreign Travel clause prescribed in 48 CFR 952.247-70.
(3) Counterintelligence clause prescribed in 48 CFR 970.0404-
4(a).
(4) Service Contract Act clauses prescribed in 48 CFR 22.1006.
(5) State and local taxes clause prescribed in 48 CFR 970.2904-
1.
(6) Cost or pricing data clauses prescribed in 48 CFR 970.1504-
3-1(b).
(End of Clause)
970.5245-1 Property.
As prescribed in 48 CFR 970.4501-1(a), insert the following clause:
Property (DEC 2000)
(a) Furnishing of Government property. The Government reserves
the right to furnish any property or services required for the
performance of the work under this contract.
(b) Title to property. Except as otherwise provided by the
contracting officer, title to all materials, equipment, supplies,
and tangible personal property of every kind and description
purchased by the contractor, for the cost of which the contractor is
entitled to be reimbursed as a direct item of cost under this
contract, shall pass directly from the vendor to the Government. The
Government reserves the right to inspect, and to accept or reject,
any item of such property. The contractor shall make such
disposition of rejected items as the contracting officer shall
direct. Title to other property, the cost of which is reimbursable
to the contractor under this contract, shall pass to and vest in the
Government upon (1) issuance for use of such property in the
performance of this contract, or (2) commencement of processing or
use of such property in the performance of this contract, or (3)
reimbursement of the cost thereof by the Government, whichever first
occurs. Property furnished by the Government and property purchased
or furnished by the contractor, title to which vests in the
Government, under this paragraph are hereinafter referred to as
Government property. Title to Government property shall not be
affected by the incorporation of the property into or the attachment
of it to any property not owned by the Government, nor shall such
Government property or any part thereof, be or become a fixture or
lose its identity as personality by reason of affixation to any
realty.
(c) Identification. To the extent directed by the contracting
officer, the contractor shall identify Government property coming
into the contractor's possession or custody, by marking and
segregating in such a way, satisfactory to the contracting officer,
as shall indicate its ownership by the Government.
(d) Disposition. The contractor shall make such disposition of
Government property which has come into the possession or custody of
the contractor under this contract as the contracting officer may
direct during the progress of the work or upon completion or
termination of this contract. The contractor may, upon such terms
and conditions as the contracting officer may approve, sell, or
exchange such property, or acquire such property at a price agreed
upon by the contracting officer and the contractor as the fair value
thereof. The amount received by the contractor as the result of any
disposition, or the agreed fair value of any such property acquired
by the contractor, shall be applied in reduction of costs allowable
under this contract or shall be otherwise credited to account to the
Government, as the contracting officer may direct. Upon completion
of the work or the termination of this contract, the contractor
shall render an accounting, as prescribed by the contracting
officer, of all government property which had come into the
possession or custody of the contractor under this contract.
(e) Protection of government property--management of high-risk
property and classified materials. (1) The contractor shall take all
reasonable precautions, and such other actions as may be directed by
the contracting officer, or in the absence of such direction, in
accordance with sound business practice, to safeguard and protect
government property in the contractor's possession or custody.
(2) In addition, the contractor shall ensure that adequate
safeguards are in place, and adhered to, for the handling, control
and disposition of high-risk property and classified materials
throughout the life cycle of the property and materials consistent
with the policies, practices and procedures for
[[Page 81079]]
property management contained in the Federal Property Management
regulations (41 CFR chapter 101), the Department of Energy Property
Management regulations (41 CFR chapter 109), and other applicable
regulations.
(3) High-risk property is property, the loss, destruction,
damage to, or the unintended or premature transfer of which could
pose risks to the public, the environment, or the national security
interests of the United States. High-risk property includes
proliferation sensitive, nuclear related dual use, export
controlled, chemically or radioactively contaminated, hazardous, and
specially designed and prepared property, including property on the
militarily critical technologies list.
(f) Risk of loss of Government property. (1)(i) The contractor
shall not be liable for the loss or destruction of, or damage to,
Government property unless such loss, destruction, or damage was
caused by any of the following:
(A) Willful misconduct or lack of good faith on the part of the
contractor's managerial personnel;
(B) Failure of the contractor's managerial personnel to take all
reasonable steps to comply with any appropriate written direction of
the contracting officer to safeguard such property under paragraph
(e) of this clause; or
(C) Failure of contractor managerial personnel to establish,
administer, or properly maintain an approved property management
system in accordance with paragraph (i)(1) of this clause.
(ii) If, after an initial review of the facts, the contracting
officer informs the contractor that there is reason to believe that
the loss, destruction of, or damage to the government property
results from conduct falling within one of the categories set forth
above, the burden of proof shall be upon the contractor to show that
the contractor should not be required to compensate the government
for the loss, destruction, or damage.
(2) In the event that the contractor is determined liable for
the loss, destruction or damage to Government property in accordance
with (f)(1) of this clause, the contractor's compensation to the
Government shall be determined as follows:
(i) For damaged property, the compensation shall be the cost of
repairing such damaged property, plus any costs incurred for
temporary replacement of the damaged property. However, the value of
repair costs shall not exceed the fair market value of the damaged
property. If a fair market value of the property does not exist, the
contracting officer shall determine the value of such property,
consistent with all relevant facts and circumstances.
(ii) For destroyed or lost property, the compensation shall be
the fair market value of such property at the time of such loss or
destruction, plus any costs incurred for temporary replacement and
costs associated with the disposition of destroyed property. If a
fair market value of the property does not exist, the contracting
officer shall determine the value of such property, consistent with
all relevant facts and circumstances.
(3) The portion of the cost of insurance obtained by the
contractor that is allocable to coverage of risks of loss referred
to in paragraph (f)(1) of this clause is not allowable.
(g) Steps to be taken in event of loss. In the event of any
damage, destruction, or loss to Government property in the
possession or custody of the contractor with a value above the
threshold set out in the contractor's approved property management
system, the contractor:
(1) Shall immediately inform the contracting officer of the
occasion and extent thereof,
(2) Shall take all reasonable steps to protect the property
remaining, and
(3) Shall repair or replace the damaged, destroyed, or lost
property in accordance with the written direction of the contracting
officer. The contractor shall take no action prejudicial to the
right of the Government to recover therefore, and shall furnish to
the Government, on request, all reasonable assistance in obtaining
recovery.
(h) Government property for Government use only. Government
property shall be used only for the performance of this contract.
(i) Property Management. (1) Property Management System. (i) The
contractor shall establish, administer, and properly maintain an
approved property management system of accounting for and control,
utilization, maintenance, repair, protection, preservation, and
disposition of Government property in its possession under the
contract. The contractor's property management system shall be
submitted to the contracting officer for approval and shall be
maintained and administered in accordance with sound business
practice, applicable Federal Property Management regulations and
Department of Energy Property Management regulations, and such
directives or instructions which the contracting officer may from
time to time prescribe.
(ii) In order for a property management system to be approved,
it must provide for:
(A) Comprehensive coverage of property from the requirement
identification, through its life cycle, to final disposition;
(B) Employee personal responsibility and accountability for
Government-owned property;
(C) Full integration with the contractor's other administrative
and financial systems; and
(D) A method for continuously improving property management
practices through the identification of best practices established
by ``best in class'' performers.
(iii) Approval of the contractor's property management system
shall be contingent upon the completion of the baseline inventory as
provided in subparagraph (i)(2) of this clause.
(2) Property Inventory. (i) Unless otherwise directed by the
contracting officer, the contractor shall within six months after
execution of the contract provide a baseline inventory covering all
items of Government property.
(ii) If the contractor is succeeding another contractor in the
performance of this contract, the contractor shall conduct a joint
reconciliation of the property inventory with the predecessor
contractor. The contractor agrees to participate in a joint
reconciliation of the property inventory at the completion of this
contract. This information will be used to provide a baseline for
the succeeding contract as well as information for closeout of the
predecessor contract.
(j) The term ``contractor's managerial personnel'' as used in
this clause means the contractor's directors, officers and any of
its managers, superintendents, or other equivalent representatives
who have supervision or direction of:
(1) All or substantially all of the contractor's business; or
(2) All or substantially all of the contractor's operations at
any one facility or separate location to which this contract is
being performed; or
(3) A separate and complete major industrial operation in
connection with the performance of this contract; or
(4) A separate and complete major construction, alteration, or
repair operation in connection with performance of this contract; or
(5) A separate and discrete major task or operation in
connection with the performance of this contract.
(k) The contractor shall include this clause in all cost
reimbursable subcontracts.
(End of Clause)
Alternate I (DEC 2000). As prescribed in 48 CFR 970.4501-1(b),
when the award is to a nonprofit contractor, replace paragraph (j)
of the basic clause with the following paragraph (j):
(j) The term ``contractor's managerial personnel'' as used in
this clause means the contractor's directors, officers and any of
its managers, superintendents, or other equivalent representatives
who have supervision or direction of all or substantially all of:
(1) The contractor's business; or
(2) The contractor's operations at any one facility or separate
location at which this contract is being performed; or
(3) The contractor's Government property system and/or a Major
System Acquisition or Major Project as defined in DOE Order 4700.1
(Version in effect on effective date of contract).
[FR Doc. 00-31542 Filed 12-21-00; 8:45 am]
BILLING CODE 6450-01-P