# DLAD PART 32 – CONTRACT FINANCING

- 32.004 Contract performance in foreign countries.
- 32.006 Reduction or suspension of contract payments upon finding of fraud.

- 32.006-1 General.
- 32.006-2 Definitions.
- 32.006-3 Responsibilities.
- 32.006-5 Reporting.

- 32.071 Contract Finance Committee.

- SUBPART 32.1 – NON-COMMERCIAL ITEM PURCHASE FINANCING

- 32.111 Contract Clauses for Non-Commercial Purchases.
- 32.111(a)(7)(90)
- 32.114 Unusual Contract Financing.

- SUBPART 32.2 – COMMERCIAL ITEM PURCHASE FINANCING

- 32.206 Contract Clauses for Non-Commercial Purchases.

- 32.206-90 Vendor Rebate Program (VRP).

- SUBPART 32.3 – LOAN GUARANTEES FOR DEFENSE PRODUCTION

- 32.304 Procedure.

- 32.304-1 Application for guarantee.

- SUBPART 32.4 – ADVANCE PAYMENTS FOR NON-COMMERCIAL ITEMS

- 32.402 General.
- 32.409 Contracting officer action.

- 32.409-1 Recommendation for approval.
- 32.409-2 Recommendation for disapproval.

- SUBPART 32.5 – PROGRESS PAYMENTS BASED ON COSTS

- 32.501 General.

- 32.501-2 Unusual progress payments.

- 32.502 Preaward matters.

- 32.502-1 Use of customary progress payments.
- 32.502-3
- 32.502-4 Contract clauses.

- SUBPART 32.6 – CONTRACT DEBTS

- 32.610 Demand for payment of contract debt.
- 32.614 Interest.

- 32.614-1 Interest charges.

- 32.690 Claims processing.

- SUBPART 32.7 – CONTRACT FUNDING

- 32.703 Contract funding requirements.

- 32.703-2 Contracts conditioned upon the availability of funds.

- SUBPART 32.9 – PROMPT PAYMENT

- 32.906 Contract financing payments.
- 32.907 Interest penalties.

- 32.907-1 late invoice payment.

- 32.908 Contract Clauses.

- 32.908-90
- 32.908-90
- 32.908-91

PART 32 – CONTRACT FINANCING

TABLE OF CONTENTS

32.004 Contract performance in foreign countries.

32.071 Contract finance committee.

32.006 Reduction or suspension of contract payments upon finding of fraud.

32.006-1 General.

32.006-2 Definitions.

32.006-3 Responsibilities.

32.006-5 Reporting.

SUBPART 32.1 – NON COMMERCIAL-ITEM PURCHASE FINANCING

32.111 Contract clauses for non-commercial purchases.

32.114 Unusual contract financing.

SUBPART 32.2 – COMMERCIAL ITEM PURCHASE FINANCING

32.206 Solicitation provisions and contract clauses.

32.908 Contract clauses.

SUBPART 32.3 – LOAN GUARANTEES FOR DEFENSE PRODUCTION

32.304 Procedure.

32.304-1 Application for guarantee.

SUBPART 32.4 – ADVANCE PAYMENTS FOR NON-COMMERCIAL ITEMS

32.402 General.

32.407 Interest.

32.409 Contracting officer action.

32.409-1 Recommendation for approval.

32.409-2 Recommendation for disapproval.

SUBPART 32.5 – PROGRESS PAYMENTS BASED ON COSTS

32.501 General.

32.501-2 Unusual progress payments.

32.502 Preaward matters.

32.502-1 Use of customary progress payments.

32.502-3 Solicitation provisions.

32.502-4 Contract clauses.

SUBPART 32.6 – CONTRACT DEBTS

32.610 Demand for payment of contract debt.

32.613 Deferment of collection.

32.614 Interest.

32.690 Claims processing.

SUBPART 32.7 – CONTRACT FUNDING

32.703 Contract funding requirements.

32.703-2 Contracts conditioned upon the availability of funds.

SUBPART 32.9 – PROMPT PAYMENT

32.905 Reserved.

32.906 Contract financing payments.

32.907 Interest penalties.

32.907-1 Late invoice payment.

32.908 Contract clauses.

32.004 Contract performance in foreign countries.

(a) Foreign currencies owned by the U.S. Government shall be used, when feasible, to make payments under contracts in foreign countries. The provisions of DODD 7360.11, Use of Foreign Currencies, will govern.

(b)

Insert the clause at 52.232-9007, Contractor’s Remittance Address(TACOM DLR - Land and Maritime Supply Chain), in all solicitations and contracts for depot level reparable items managed by TACOM if award is to be made to a foreign vendor for work performed outside the U.S. This is also available for SPS/PD2 users.

32.006 Reduction or suspension of contract payments upon finding of fraud.

32.006-1 General.

(b) Level IV of the Executive Schedule is the Under Secretary of Defense (Acquisition and Technology).

32.006-2 Definitions.

(a) DLA's remedy coordination official is the Associate General Counsel, Fraud Remedies Program.

32.006-3 Responsibilities.

(b) Instances of suspected fraud shall be promptly forwarded by the chief of the contracting office to local fraud counsel for appropriate action.

32.006-5 Reporting.

The DLA remedy coordination official shall prepare the report which shall be submitted by memorandum by the Director, DLA or his deputy to the Under Secretary of Defense (Acquisition and Technology) through the Director of Defense Procurement.

32.071 Contract Finance Committee.

(b)(2) Deviations. Requests for authority to deviate from the provisions of FAR Part 32, DFARS Part 232, or Part 32 of this directive shall be submitted to HQ DLA, ATTN: J-73.

SUBPART 32.1 – NON-COMMERCIAL ITEM PURCHASE FINANCING

32.111 Contract Clauses for Non-Commercial Purchases.

32.111(a)(7)(90)

The clause at 52.232-9005, Invoicing Instructions (Time-and-Materials or Labor-Hour task order Contract), may be used in solicitations and contracts when a time-and-materials or labor-hour task order contract is contemplated. The KO should consider using this clause when assurance of proper invoice verification is needed. If this clause is used, all subcontracts must be approved in writing by the Contracting Officer. Use this clause with FAR 52.211-2 and DFARS 252.232-7003.

32.114 Unusual Contract Financing.

If an alternative financing arrangement other than PBP is being contemplated, the contracting officer shall submit the proposed arrangement through J72 to obtain J7 coordination prior to submission to DPAP for review and concurrence.

SUBPART 32.2 – COMMERCIAL ITEM PURCHASE FINANCING

32.206 Contract Clauses for Non-Commercial Purchases.

32.206-90 Vendor Rebate Program (VRP).

The Vendor Rebate Program (VRP) is a program whereby a contractor (vendor) is required to submit a "rebate" to the DLA Land & Maritime ( formerly DSCC )for a percentage of sales made directly against a DSCC contract by other Government entities via the Government-wide Commercial Purchase Card.

The clause 52.232-9004, Purchase Card Purchases – Vendor Rebate Program (VRP), will be included in solicitations and awards of long-term contracts (e.g., prime vendor and corporate contracting) in which DLA Land & Maritime ( formerly DSCC ) has, or is likely to develop, a Vendor Rebate Program (VRP) with its suppliers.

SUBPART 32.3 – LOAN GUARANTEES FOR DEFENSE PRODUCTION

32.304 Procedure.

32.304-1 Application for guarantee.

(a) In the event Congressional authority to use guaranteed loans again becomes available (see DFARS 232.302(a)), any application based on a contract which cites or will cite DLA funds shall be forwarded by the Chief of the Contracting Office (not delegable) to HQ DLA, ATTN: J-85, with a copy to HQ DLA, ATTN: J-73. This procedure will be used regardless of the office responsible for administration of, or payment under, the contract.

SUBPART 32.4 – ADVANCE PAYMENTS FOR NON-COMMERCIAL ITEMS

32.402 General.

(e)(1) Authority for approving advance payments has been retained at the OSD level (see DFARS 232.070(a)).

32.407 Interest.(a)(2)8(b). For information on the interest rate, see 30.7001-2(e).

(a)(2) and (b). For information on the interest rate specified at these FAR cites, see 30.7001-2(e).

32.409 Contracting officer action.

32.409-1 Recommendation for approval.

The contracting officer's report, containing all the information specified in FAR 32.409-1, shall be forwarded by the Chief of the Contracting Office (not delegable) to HQ DLA, ATTN: J-85, with a copy to HQ DLA, ATTN: J-73. The items indicated in FAR 32.409-1(b) and (c) require submission and investigation of all information cited in FAR 32.408. Information on how advance payments, in lieu of all other financing methods, are necessary for performance of the contract, and how the authorization of advance payment is in the public interest or, as applicable (see FAR 32.402), will facilitate the national defense, shall be included in documentation to be furnished pursuant to FAR 32.409-1(d).

32.409-2 Recommendation for disapproval.

If the contracting officer determines that the request should be disapproved, the determination shall be forwarded for approval by the Chief of the Contracting Office (not delegable).The response to the contractor should include suggestions as to alternate financing methods. If the contract cites DLA funds, an information copy of the documents should be transmitted to HQ DLA following the distribution cited in 32.409-1 above. (The office administering or making payments under the contracts or maintaining the allotment records to which the payment will finally be charged is not pertinent.)

SUBPART 32.5 – PROGRESS PAYMENTS BASED ON COSTS

32.501 General.

32.501-2 Unusual progress payments.

(a) All unusual progress payments provisions along with supporting information, shall be sforwarded by the Chief of the Contracting Office (not delegable) for coordination and approval to HQ DLA, ATTN: J-85, with a copy to HQ DLA, ATTN: J-73, if the request concerns a contract which cites DLA funds.

32.502 Preaward matters.

32.502-1 Use of customary progress payments.

The use of a progress payments clause in orders with the Federal Prison Industries (FPI) and in orders with the workshops of the National Industries for the Blind (NIB) and the NISH shall be based on the criteria in FAR 32.502-1. These entities shall be afforded the same privileges for and rate of progress payments as are permitted for large business concerns.

32.502-3

32.502-4 Contract clauses.

(90) When FAR 52.232-16 is used in solicitations and/or contracts, the clause at DLAD 52.232-9000 may be included to specify additional terms as necessary.

SUBPART 32.6 – CONTRACT DEBTS

32.610 Demand for payment of contract debt.

(b)(2) For information on the interest rates specified at this FAR cite, see 15.407-1(b)(7)(i) or 30.7001-2(e) as applicable.

32.613 Deferment of collection

(h)(3) and (i) See 32.610 (b)(2).

32.614 Interest.

32.614-1 Interest charges.

(c) For information on the interest rate specified at this FAR cite, see 30.7001-2(a).

32.690 Claims processing.

Follow directions contained in DLAM 7000.1, chapter 12.

SUBPART 32.7 – CONTRACT FUNDING

32.703 Contract funding requirements.

32.703-2 Contracts conditioned upon the availability of funds.

It is recognized that there may be instances, other than those described in FAR 32.703-2, when it may be necessary to initiate a purchase prior to the availability of funds. In such instances, the action will only be taken after the facts concerning the proposed solicitation are forwarded by the Chief of the Contracting Office (not delegable) to HQ DLA, ATTN: J-73, for review as to the necessity for such action and the obtaining of the required FAR deviation permitting use of the provisions set forth in FAR 52.232-18.

SUBPART 32.9 – PROMPT PAYMENT

32.906 Contract financing payments.

(a) The DFARS 232.906(a) requirement that the contracting officer coordinate payment terms with offices involved in the payment process applies only when a timeframe longer than the normal 7 or 14 day requirements specified in the Prompt Payment clause at FAR 52.232-25(a)(6) and at FAR 52.232-25(b)(2) is used.

32.907 Interest penalties.

32.907-1 late invoice payment.

(d) and (e) For information on the interest rate specified at this FAR cite, see 30.7001-2(e).

32.908 Contract Clauses.

32.908-90

Tare is the weight of a vehicle or container when it is empty. This weight is used in calculations of net weight for tasks which range from properly charging customers for consumer goods to taxing laden trucks as they cross borders. To calculate the net weight of a load, the container is weighed to establish the tare weight and then weighed again for the gross weight, and the tare is subtracted from the gross to find out how heavy the load is.

Insert 52.232-9002, Tare Included or Excluded, in solicitations/contracts that discuss tare. For instance, IFBs, RFPs, and RFQs for fiber rope, cordage or twine when purchase is on a per pound basis and weight of tare is included would select the first paragraph while those that exclude tare would select the second paragraph.

32.908-90

52.232-9001, Invoice Confirmation – Commercial Manuals, may be used when the contractor will be required to distribute commercial manuals. DO NOT use if the requirement for commercial manuals is waived in the Purchase Order.

32.908-91

Insert 52.232-9003, Billing Weight and Payments for Carbon Steel or Steel Plate/Sheets, in solicitations/contracts acquiring carbon steel sheets, or steel plates/sheets.