Advance payments may be considered useful and appropriate for the following:
(a) Contracts for experimental, research, or development work with nonprofit educational or research institutions.
(b) Contracts solely for the management and operation of Government-owned plants.
(c) Contracts for acquisition, at cost, of property for Government ownership.
(d) Contracts of such a highly classified nature that the agency considers it undesirable for national security to permit assignment of claims under the contract.
(e) Contracts entered into with financially weak contractors whose technical ability is considered essential to the agency. In these cases, the agency shall closely monitor the contractor's performance and financial controls to reduce the Government's financial risk.
(f) Contracts for which a loan by a private financial institution is not practicable, whether or not a loan guarantee under this part is issued; for example, if—
(1) Financing institutions will not assume a reasonable portion of the risk under a guaranteed loan;
(2) Loans with reasonable interest rates or finance charges are not available to the contractor; or
(3) Contracts involve operations so remote from a financial institution that the institution could not be expected to suitably administer a guaranteed loan.
(g) Contracts with small business concerns, under which circumstances that make advance payments appropriate often occur (but see 32.104(b)).
(h) Contracts under which exceptional circumstances make advance payments the most advantageous contract financing method for both the Government and the contractor.
[48 FR 42328, Sept. 19, 1983, as amended at 72 FR 27384, May 15, 2007]
Title 48 published on 2013-10-01
The following are only the Rules published in the Federal Register after the published date of Title 48.
For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.
This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.