Overview
FAR 45.102 establishes the fundamental principle that contractors are responsible for providing all property required for contract performance, positioning Government-furnished property as a strictly justified exception rather than a standard practice.
Key Rules
- Default Responsibility: Contractors are expected to furnish all necessary property; a contractor’s lack of resources or unwillingness to invest is not a valid justification for the Government to provide property.
- The Four-Part Test: Contracting officers may only provide property if it is in the Government’s best interest, the benefits outweigh administrative and disposal costs, it does not significantly increase Government risk, and requirements cannot be met otherwise.
- Service Exception: The stringent four-part justification requirement does not apply to property provided under contracts for repair, maintenance, overhaul, or modification.
- Nonseverable Property: Government property cannot be installed on contractor-owned real property in a way that makes it nonseverable unless the Head of the Contracting Activity (HCA) determines it is necessary and in the Government's interest.
Practical Implications
- Contracting officers must perform and document a rigorous cost-benefit and risk analysis before authorizing Government-furnished property (GFP) to ensure it does not create an undue administrative burden.
- Companies seeking to use GFP must demonstrate that the acquisition cannot succeed without it, as the Government seeks to minimize its long-term liability and disposal obligations.