932.006-4 Procedures.
Subpart 932.1.General
Sec.
932.102 Description of contract financing methods.
Subpart 932.3.Loan Guarantees for Defense Production
932.304-2 Certificate of eligibility.
Subpart 932.4.Advance Payments For Non- Commercial Items
932.402 General.
932.407 Interest.
Subpart 932.5.Progress Payments Based on Costs
932.501-2 Unusual progress payments.
Subpart 932.6.Contract Debts
932.605 Responsibilities and cooperation among Government officials.
Subpart 932.8.Assignment of Claims
932.803 Policies.
Subpart 932.9.Prompt Payment
932.970 Implementing DOE policies and procedures.
Subpart 932.70.DOE Loan Guarantee Authority
932.7002 Authority.
932.7003 Policies.
932.7004 Procedures.
932.7004-1 Guaranteed loans for civilian programs.
932.7004-2 Criteria.
932.7004-3 Eligibility.
Authority: 42 U.S.C. 7254; 40 U.S.C. 486(c).
Source: 49 FR 12011, Mar. 28, 1984, unless otherwise
noted.
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(a) The remedy coordination official shall follow the
procedures identified in FAR 32.006-4.
(b) [Reserved]
[63 FR 5272, Feb. 2, 1998]
Subpart 932.1.General
932.102 Description of contract financing methods. (DOE coverage.paragraph (e)).
(e)(2) Progress payments based on a percentage or
stage of completion may be authorized by the Head of
the Contracting Activity when a determination is made
that progress payments based on costs cannot be
practically employed and that there are adequate
safeguards provided for the administration of progress
payments based on a percentage or stage of completion.
[61 FR 41702, Aug. 9, 1996]
Subpart 932.3.Loan Guarantees for Defense Production
932.304-2 Certificate of eligibility.
(h) Guaranteed loan applications shall be authorized
and transmitted to the Federal Reserve Bank only by
the Secretary or designee specified for that purpose.
Subpart 932.4.Advance Payments for Non-Commercial Items
932.402 General.
(e)(1) The Head of the Contracting Activity or designee
shall have the responsibility and authority for making
findings and determinations, and for approval of
contract terms concerning advance payments.
(2) Before authorizing any advance payment
arrangements, the approving official shall obtain the
advice, and other inputs of the servicing finance office.
932.407 Interest.
(d)(4) Advance payments may be made without interest
under cost-reimbursement contracts for construction or
engineering services.
Subpart 932.5.Progress Payments Based on Costs
932.501-2 Unusual progress payments.
(a)(3) The Head of the Contracting Activity shall
forward all requests which are considered favorable,
with supporting information, to the Procurement
Executive, who, after coordination with the Chief
Financial Officer, Headquarters, will approve or deny
the request.
(d) Requests for unusual progress payments will not be
considered as a handicap or adverse factor in the award
of a contract; provided the bid or proposal is not
conditioned on approval of such request.
Subpart 932.6.Contract Debts
932.605 Responsibilities and cooperation among Government officials.
(b) The DOE contracting officer has primary
responsibility for determining the amount of contract
debt and notifying the cognizant finance office of such
debt due the Government. The servicing DOE finance
office making payments under the contract has primary
responsibility for debt collection.
Subpart 932.8.Assignment of Claims
932.803 Policies.
(d) In the case of prime contracts, when it has been
determined that the financing of contracts will be
facilitated in the interest of DOE programs, it is the
policy of DOE that such contracts provide, or be
amended without consideration (see Assignment of
Claims Act of 1940) to provide, in conformance with
FAR 32.804, that payments to be made to an assignee
shall not be subject to reduction or setoff. In the case
of subcontracts, when loans are made for the purpose
of financing performance of subcontracts under DOE
prime contracts, financing institutions or the
Government as guarantor in those instances in which
such loans are guaranteed should not be required to
incur risks of loss by reason of possible diversion of
assigned subcontracts proceeds for payment of other
claims of the prime contractor against the borrower,
otherwise unrelated to the assigned subcontracts. The
Head of the Contracting Activity shall require the
adoption of these policies and practices by DOE prime
contractors with respect to DOE subcontract work. The
Head of the Contracting Activity should inform the
Chief Financial Officer, Headquarters, of each DOE
contractor who is unwilling to adopt policies consistent with this paragraph and the reasons given in support of
the contractor's position.
Subpart 932.9.Prompt Payment
932.970 Implementing DOE policies and procedures.
(a) Invoice payments. (1) Contract Settlement Date. For purposes of determining any interest penalties
under cost-type contracts, the effective date of contract
settlement shall be the effective date of the final
contract modification issued to acknowledge contract
settlement and to close out the contract.
(2) Constructive acceptance periods. Where the contracting officer determines, in writing, on a
case-by-case basis, that it is not reasonable or feasible
for DOE to perform the acceptance or approval
function within the standard period, the contracting
officer should specify a longer constructive acceptance
or approval period, as appropriate. Considerations
include, but are not limited to, the nature of supplies or
services involved, geographical site location,
inspection and testing requirements, shipping and
acceptance terms, and available DOE resources.
(b) Contract financing payments. Contracting officers may specify payment due dates that are less than the
standard 30 days when a determination is made, in
writing, on a case-by-case basis, that a shorter contract
financing payment cycle will be required to finance
contract work. In such cases, the contracting officer
should coordinate with the finance and program
officials that will be involved in the payment process to
ensure that the contract payment terms to be specified
in solicitations and resulting contract awards can be
reasonably met. Consideration should be given to
geographical separation, workload, contractor ability to
submit a proper request, and other factors that could
affect timing of payment. However, payment due dates
that are less than 7 days for progress payments or less
than 14 days for interim payments on cost-type
contracts are not authorized.
[54 FR 9808, Mar. 8, 1989; 61 FR 41702, Aug. 9,
1996]
Subpart 932.70.DOE Loan Guarantee Authority
932.7002 Authority.
Guaranteed loan applications shall be authorized and transmitted to the Federal Reserve Board only by the Secretary, or designee specified for that purpose, and
only when made pursuant to enabling legislation or
other authority; e.g., by executive order or regulation.
932.7003 Policies.
The following policies governing the exercise of its
loan guarantee authority have been established by
DOE:
(a) The use of the loan guarantee authority is not
restricted to contracts or subcontracts of any particular
type or class. Each case is to be evaluated on its own
merits and under the particular circumstances
applicable thereto.
(b) The fact that a contract has been awarded as a result
of competitive bidding should not, of itself, render the
loan ineligible for guarantee by DOE if the contractor
is financially responsible and its need for working
capital is the result of the impact of a defense program
or any other DOE program for which guaranteed loans
are authorized.
(c) The guarantee authority should, in general, not be
used in connection with loans to contractors required to
furnish performance bonds, except in those cases in
which the time likely to be required for the surety or
DOE to take over in the event of default will result in
delays which cannot be tolerated by the particular
program concerned. When performance bonds have
been furnished, the surety shall be required to
subordinate its rights in favor of the guaranteed loan.
(d) The criterion that the materials or services to be
provided cannot readily be acquired from alternative
sources does not require the finding that the materials
or services are absolutely unobtainable elsewhere. The
criterion should be so applied as to permit guarantees
of loans when, although the materials or services can
be obtained elsewhere, such factors as the urgency of
supply schedules, technical capacity of the contractor,
comparative prices, and time and expense involved in
reissuing the contract, including termination payment,
establish that it is to the Government's advantage not to
resort to alternative sources merely because the
contractor or subcontractor may require a guaranteed
loan.
(e) If it is known at the time the contract is to be
awarded that the low offeror who is technically
qualified and competent to furnish the required
materials and services will require a guaranteed loan,
the contracting officer should obtain appropriate advice
and in reaching a decision should consider at least the
following:
(1) The savings to be realized by awarding the contract
to the low offeror;
(2) The risk to the Government in guaranteeing a loan;
and
(3) The likelihood, if award is made to the second low
offeror, of that offeror's applying for a guaranteed loan
at a later date.
Extreme care should be exercised in rejecting a low bid
or proposal simply because the low offeror requires a
guaranteed loan.
(f) The amount of the loan should bear reasonable
relationship to such factors as the value and terms of
the contract, the probable investment required to be
made by the contractor in payrolls and inventories, the
frequency with which contract payments are to be
made, and the borrower's current working capital
position.
(g) Borrowings for working capital purposes under
guaranteed loans shall be limited to the amount
necessary to perform the contract for which the loan is
sought. In order that the contractor will also use its
own funds in the performance of the contracts, amounts
outstanding under the loan or line-of-credit shall be
limited to an amount not to exceed 90 percent of the
borrower's investment in its contracts, regardless of the
total amount of the loan or line of credit authorized.
The borrower's investment includes all items for which
the borrower would be entitled to payment on
performance or termination of contracts, but does not
include any items for which no work has been done nor
expenditures made.
(h) Unless there are exceptional circumstances, the
loan should mature not later than 30 days after the
estimated date of final payment under the contract.
932.7004 Procedures.
932.7004-1 Guaranteed loans for civilian programs.
The procedures for authorizing a guaranteed loan under
legislation other than section 301 of the Defense
Production Act of 1950 (50 U.S.C. App. 2091) shall
be essentially the same as those set forth in FAR
32.304, Procedures, FAR 32.305, Loan Guarantees for
Terminated Contracts, and FAR 32.306 Loan
Guarantee for Subcontracts; except that any contrary
provisions required by enabling legislation authorizing
the loan shall govern.
932.7004-2 Criteria.
(a) The materials or services to be furnished by the
contractor are necessary to the Government interest.
(b) The materials or services cannot as a practical
matter be obtained from alternate sources without delay
or impeding the Government's interest, except that no
small business concern shall be held ineligible for the
issuance of such guarantee by reason of alternative
sources of supply.
(c) The contractor has demonstrated its inability to
obtain the necessary financing in conventional credit
channels without the guarantee.
(d) There is reasonable assurance that the loan can be
repaid.
(e) The contractor is competent to perform the contract.
932.7004-3 Eligibility.
The applicant's eligibility for a guaranteed loan will be
based on:
(a) Contracting officer determinations and findings
regarding items (a), (b) and (e) in 932.7004-2 as
incorporated in a Certificate of Eligibility (FAR
32.304-2); and
(b) The Chief Financial Officer's determination for items (c) and (d) in 932.7004-2 based on information contained in the application, the Federal Reserve Bank's report, and information furnished by the contracting activity concerned.