1998

41 U.S.C.-PUBLIC CONTRACTS-SEC. 253

shall be required in the same manner as heretofore, or (B) permit any contract for the construction or repair of buildings, roads, sidewalks, sewers, mains, or similar items to be negotiated without advertising as required by section 253 of this title, unless such contract is to be performed outside the continental United States or unless negotiation of such contract is authorized by the provisions of paragraphs (1)-(3), (10)-(12), or (14) of subsection (c) of this section. (f) Carriage of cargo; specification of container size.

No contract for the carriage of Government property in other than Government-owned cargo containers shall require carriage of such property in cargo containers of any stated length, height, or width. (June 30, 1949, ch. 288, title II, § 302, 63 Stat. 393; July 12, 1952, ch. 703, § 1 (m), 66 Stat. 594; Aug. 28, 1958, Pub. L. 85-800, §§ 1-3, 72 Stat. 966; Nov. 8, 1965, Pub. L. 89-343, §§ 1, 2, 79 Stat. 1303; Nov. 8, 1965, Pub. L. 89-348, § 1(2), 79 Stat. 1310; Mar. 16, 1968, Pub. L. 90-268, § 4, 82 Stat. 50.)

§ 253. Advertising requirements.

Whenever advertising is required

(a) The advertisement for bids shall be made a sufficient time previous to the purchase or contract, and specifications and invitations for bids shall permit such full and free competition as is consistent with the procurement of types of property and services necessary to meet the requirements of the agency concerned. No advertisement or invitation to bid for the carriage of Government property in other than Government-owned cargo containers shall specify carriage of such property in cargo containers of any stated length, height, or width.

(b) All bids shall be publicly opened at the time and place stated in the advertisement. Award shall be made with reasonable promptness by written notice to that responsible bidder whose bid, conforming to the invitation for bids, will be most advantageous to the Government, price and other factors considered: Provided, That all bids may be rejected when the agency head determines that it is in the public interest so to do. (June 30, 1949, ch. 288, title III, § 303, 63 Stat. 393; July 12, 1952, ch. 703, § 1(m), 66 Stat. 594; Mar. 16, 1968, Pub. L. 90– 268, § 2, 82 Stat. 49.)

§ 254. Negotiated contracts.

(a) Requirements.

Except as provided in subsection (b) of this section, contracts negotiated pursuant to section 252 (c) of this title may be of any type which in the opinion of the agency head will promote the best interests of the Government. Every contract negotiated pursuant to section 252 (c) of this title shall contain a suitable warranty, as determined by the agency head, by the contractor that no person or selling agency has been employed or retained to solicit or secure such contract upon an agreement or understanding for a commission, percentage, brokerage, or contingent fee, excepting bona fide employees or bona fide established commercial or selling agencies maintained by the contractor for the purpose

of

41 U.S.C.-PUBLIC CONTRACTS-SEC. 254

1999

securing business, for the breach or violation of which warranty the Government shall have the right to annul such contract without liability or in its discretion to deduct from the contract price or consideration the full amount of such commission, percentage, brokerage, or contingent fee.

(b) Barred contracts; fee limitation; determination of use; advance notification. The cost-plus-a-percentage-of-cost system of contracting shall not be used, and in the case of a cost-plus-a-fixed-fee contract the fee shall not exceed 10 per centum of the estimated cost of the contract, exclusive of the fee, as determined by the agency head at the time of entering into such contract (except that a fee not in excess of 15 per centum of such estimated cost is authorized in any such contract for experimental, developmental, or research work and that a fee inclusive of the contractor's costs and not in excess of 6 per centum of the estimated cost, exclusive of fees, as determined by the agency head at the time of entering into the contract, of the project to which such fee is applicable is authorized in contracts for architectural or engineering services relating to any public works or utility project). Neither a cost nor a cost-plus-a-fixed-fee contract nor an incentive-type contract shall be used unless the agency head determines that such method of contracting is likely to be less costly than other methods or that it is impractical to secure property or services of the kind or quality required without the use of a cost or cost-plus-a-fixed-fee contract or an incentive-type contract. All cost and cost-plus-a-fixed-fee contracts shall provide for advance notification by the contractor to the procuring agency of any subcontract thereunder on a cost-plus-a-fixed-fee basis and of any fixed-price subcontract or purchase order which exceeds in dollar amount either $25,000 or 5 per centum of the total estimated cost of the prime contract; and a procuring agency, through any authorized representative thereof, shall have the right to inspect the plans and to audit the books and records of any prime contractor or subcontractor engaged in the performance of a cost or cost-plus-a-fixed-fee contract. (c) Examination of books, records, etc., of contractors; time limitation; exemptions: exceptional conditions; reports to Congress.

All contracts negotiated without advertising pursuant to authority contained in this chapter, chapters 10 and 16 of Title 40, and chapter 11 of Title 44 shall include a clause to the effect that the Comptroller General of the United States or any of his duly authorized representatives shall until the expiration of three years after final payment have access to and the right to examine any directly pertinent books, documents, papers, and records of the contractor or any of his subcontractors engaged in the performance of and involving transactions related to such contracts or subcontracts. Under regulations to be prescribed by the Administrator, however, such clause may be omitted from contracts with foreign contractors or foreign subcontractors if the agency head determines, with the concurrence of the Comptroller General of the United States or his designee, that the omission will serve the best interests of the United States. However, the concurrence of the Comptroller General of the United States or his designee is not required for the omission of such clause

2000

41 U.S.C.-PUBLIC CONTRACTS-SEC. 254a

(1) where the contractor or subcontractor is a foreign government or agency thereof or is precluded by the laws of the country involved from making its books, documents, papers, or records available for examination; and

(2) where the agency head determines, after taking into account the price and availability of the property or services from United States. sources, that the public interest would be best served by the omission of the clause.

If the clause is omitted based on a determination under clause (2) a written report shall be furnished to the Congress. The power of the agency head to make the determination specified in the preceding sentences shall not be delegable. (June 30, 1949, ch. 288, title III, § 304, 63 Stat. 395; Oct. 31, 1951, ch. 652, 65 Stat. 700; July 12, 1952, ch. 703, § 1(m), 66 Stat. 594; Sept. 27, 1966, Pub. L. 89-607, § 2, 80 Stat. 850.)

§ 254a. Cost-type research and development contracts with educational institutions.

On and after September 5, 1962, provision may be made in cost-type research and development contracts (including grants) with universities, colleges, or other educational institutions for payment of reimbursable indirect costs on the basis of predetermined fixed-percentage rates applied to the total, or an element thereof, of the reimbursable direct costs incurred. (Pub. L. 87-638, Sept. 5, 1962, 76 Stat. 437.)

§ 255. Advance or other payments; restrictions; conditions.

(a) Any executive agency may

(1) make advance, partial, progress or other payments under contracts for property or services made by the agency; and

(2) insert in bid solicitations for procurement of property or services a provision limiting to small business concerns advance or progress payments. (b) Payments made under subsection (a) of this section may not exceed the unpaid contract price.

(c) Advance payments under subsection (a) of this section may be made only upon adequate security and a determination by the agency head that to do so would be in the public interest. Such security may be in the form of a lien in favor of the Government on the property contracted for, on the balance in an account in which such payments are deposited, and on such of the property acquired for performance of the contract as the parties may agree. This lien shall be paramount to all other liens. (June 30, 1949, ch. 288, title III, § 305, 63 Stat. 396; July 12, 1952, ch. 703, § 1(m), 66 Stat. 594; Aug. 28, 1958, Pub. L. 85-800, § 4, 72 Stat. 966.)

§ 256a. Waiver of liquidated damages.

Whenever any contract made on behalf of the Government by the head of any Federal Agency, or by officers authorized by him so to do, includes a provision for liquidated damages for delay, the Comptroller General upon recom

41 U.S.C.-PUBLIC CONTRACTS-SEC. 258

2001

mendation of such head is authorized and empowered to remit the whole or any part of such damages as in his discretion may be just and equitable. (Sept. 5, 1950, ch. 849, § 10(a), 64 Stat. 591.)

§ 257. Administrative determinations.

(a) Conclusiveness; delegation of powers.

The determinations and decisions provided in this chapter to be made by the Administrator or other agency head may be made with respect to individual purchases and contracts or with respect to classes of purchases or contracts, and shall be final. Except as provided in subsection (b) of this section, and except as provided in section 486(d) of Title 40 with respect to the Administrator, the agency head is authorized to delegate his powers provided by this chapter, including the making of such determinations and decisions, in his discretion and subject to his direction, to any other officer or officers or officials of the agency. (b) Nondelegable powers; powers delegable to certain persons.

The power of the agency head to make the determinations or decisions specified in paragraphs (12) and (13) of section 252 (c) of this title shall not be delegable, and the power to make the determinations or decisions specified in paragraph (11) of section 252(c) of this title shall be delegable only to a chief officer responsible for procurement and only with respect to contracts which will not require the expenditure of more than $25,000.

(c) Basis of determinations; finding conclusive; preservation of findings; copy. Each determination or decision required by paragraphs (11)-(13), or (14) of section 252 (c), by section 254 or by section 255 (c) of this title shall be based upon written findings made by the official making such determination, which findings shall be final and shall be available within the agency for a period of at least six years following the date of the determination. A copy of the findings shall be submitted to the General Accounting Office with the contract. (d) Preservation of data.

In any case where any purchase or contract is negotiated pursuant to the provisions of section 252 (c) of this title, except in a case covered by paragraphs (2)-(5), or (6) of section 252(c) of this title, the data with respect to the negotiation shall be preserved in the files of the agency for a period of six years following final payment on such contract. (June 30, 1949, ch. 288, title III, § 307, 63 Stat. 396; Aug. 28, 1958, Pub. L. 85-800, § 5, 72 Stat. 967; Nov. 8, 1965, Pub. L. 89-343, §§ 3, 4, 79 Stat. 1303.)

§ 258. Laws applicable to contracts.

No purchase or contract shall be exempt from sections 35-45 of this title, or from sections 276a to 276a-5 of Title 40, solely by reason of having been entered into pursuant to section 252 (c) of this title without advertising, and the provisions of sections 276a to 276a-5, 324 and 325a of Title 40, if otherwise appli

2002

41 U.S.C.-PUBLIC CONTRACTS-SEC. 259

cable, shall apply to such purchases and contracts. (June 30, 1949, ch. 288, title III, § 308, 63 Stat. 396.)

§ 259. Definitions.

As used in this chapter

(a) The term "agency head" shall mean the head or any assistant head of any executive agency, and may at the option of the Administrator include the chief official of any principal organizational unit of the General Services Administration.

(b) Repealed. July 12, 1952, ch. 703, § 1(h), 66 Stat. 593.

(June 30, 1949, ch. 288, title III, § 309, 63 Stat. 396; July 12, 1952, ch. 703, § 1(h), 66 Stat. 593.)

§ 260. Laws not applicable to contracts.

Sections 5, 8, and 13 of this title shall not apply to the procurement of property or services made by an executive agency pursuant to this chapter. Any provision of law which authorizes an executive agency (other than an executive agency which is exempted from the provisions of this title by section 252(a) of this title), to procure any property or services without advertising or without regard to said section 5 of this title shall be construed to authorize the procurement of such property or services pursuant to section 252(c)(15) of this title without regard to the advertising requirements of sections 252(c) and 253 of this title. (June 30, 1949, ch. 288, title III, § 310, 63 Stat. 397; July 12, 1952, ch. 703, § 1(m), (n), 66 Stat. 594; Aug. 28, 1958, Pub. L. 85-800, § 6, 72 Stat. 967; Nov. 8, 1965, Pub. L. 89-343, § 5, 79 Stat. 1303.)

JUDICIAL REVIEW OF ADMINISTRATIVE DECISIONS

§ 321. Limitation on pleading contract-provisions relating to finality; standards of review.

No provision of any contract entered into by the United States, relating to the finality or conclusiveness of any decision of the head of any department or agency or his duly authorized representative or board in a dispute involving a question arising under such contract, shall be pleaded in any suit now filed or to be filed as limiting judicial review of any such decision to cases where fraud by such official or his said representative or board is alleged: Provided, however, That any such decision shall be final and conclusive unless the same is fraudulent or capricious or arbitrary or so grossly erroneous as necessarily to imply bad faith, or is not supported by substantial evidence. (May 11, 1954, ch. 199, § 1, 68 Stat. 81.)

§ 322. Contract-provisions making decisions final on questions of law.

No Government contract shall contain a provision making final on a question of law the decision of any administrative official, representative, or board. (May 11, 1954, ch. 199, § 2, 68 Stat. 81.)