[Federal Register Volume 64, Number 179 (Thursday, September 16, 1999)]
[Proposed Rules]
[Pages 50334-50388]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-23031]


      

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_______________________________________________________________________

Part II

National Aeronautics and Space Administration
_______________________________________________________________________



14 CFR Parts 1260 and 1274



NASA Grants and Cooperative Agreements; Proposed Rule

  Federal Register / Vol. 64, No. 179 / Thursday, September 16, 1999 / 
Proposed Rules  

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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

14 CFR Parts 1260 and 1274


NASA Grants and Cooperative Agreements

AGENCY: National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: This proposed rule revises NASA's grant and cooperative 
agreement regulations in order to clarify and amplify administrative 
requirements. Revisions have been made to reduce administrative 
requirements on grant and cooperative agreement recipients and ensure 
that uniform policies are followed by NASA centers.

DATES: Comments should be submitted on or before November 15, 1999.

ADDRESSES: Interested parties should submit written comments to Jeff 
Lupis, NASA Headquarters, Office of Procurement, Analysis Division 
(Code HC), Washington, DC 20546. Comments may also be submitted by e-
mail to [email protected].

FOR FURTHER INFORMATION CONTACT: Jeff Lupis, NASA Headquarters, Code 
HC, Washington, DC 20546, telephone: (202) 358-0462; e-mail: 
[email protected].

SUPPLEMENTARY INFORMATION:

A. Background

    A comprehensive revision is being made to NASA grant and 
cooperative agreement policy codified at 14 CFR 1260, Grants and 
Cooperative Agreements, and 14 CFR 1274, Grants and Cooperative 
Agreements with Commercial Firms. The revision has been initiated by 
NASA as part of re-engineering the process for awarding and 
administering grants and cooperative agreements. Changes are chiefly 
aimed at reducing paperwork requirements or clarifying pre-established 
policies. Three new policies being adopted by NASA relating to titling 
of equipment, awarding grants to commercial organizations, and vendor 
registration in the DoD Central Contractor Registration (CCR) System 
are policies already in use by other agencies. A synopsis of some of 
the more significant changes being adopted under this revision are: 
incorporation of a standard grant and cooperative agreement cover page; 
a new grant numbering system; expanded guidance on appropriate use of 
grant awards; clarification on participation by foreign organizations; 
reduction in the lead time goal for awarding grants; streamlined grant 
award documentation; clarification of grant administration 
responsibilities; a new policy allowing the award of grants to 
commercial firms; a new policy that (except for exceptional 
circumstances) vests title to acquired equipment with the grant 
recipient as ``exempt'' property, and a new policy requiring CCR 
registration prior to award of a grant or cooperative agreement.

B. Regulatory Flexibility Act

    An initial Regulatory Flexibility Analysis has not been prepared 
because the proposed changes are not expected to have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq. The 
revisions made under this proposed rule are largely limited to 
administrative changes to the grant and cooperative agreement award and 
administration process, other changes (e.g. vesting of title to 
property to grant recipients) will not have a significant economic 
impact. Also, an estimated two thirds of NASA vendors are already 
registered in the CCR System.

C. Paperwork Reduction Act

    This proposed rule includes a new requirement for collection of 
information from grant and cooperative agreement recipients for CCR 
registration. This collection of information requires NASA to obtain 
approval from the Office of Management and Budget under 44 U.S.C. 3501, 
et seq. The required approval will be requested.

List of Subjects in 14 CFR Parts 1260 and 1274

    Grant Programs--Science and Technology.
Tom Luedtke,
Associate Administrator for Procurement.
    Accordingly, 14 CFR Chapter V is proposed to be amended as follows:
    1. Part 1260 is revised to read as follows:

PART 1260--GRANTS AND COOPERATIVE AGREEMENTS

Subpart A--General

Sec.
1260.1  Authority.
1260.2  Purpose.
1260.3  Definitions.
1260.4  Applicability.
1260.5  Amendment.
1260.6  Publication.
1260.7  Deviations.

Pre-Award Requirements

1260.10  Proposals.
1260.11  Evaluation and selection.
1260.12  Choice of award instrument.
1260.13  Award procedures.
1260.14  Limitations.
1260.15  Format and numbering.
1260.16  Distribution.

Provisions

1260.20  Provisions.
1260.21  Compliance with OMB Circular A-110.
1260.22  Technical publications and reports.
1260.23  Extensions.
1260.24  Termination and enforcement.
1260.25  Change in principal investigator or scope.
1260.26  Financial management.
1260.27  Equipment and other property.
1260.28  Patent rights.
1260.29  Invention reporting and rights.
1260.30  Rights in data.
1260.31  National security.
1260.32  Nondiscrimination.
1260.33  Subcontracts.
1260.34  Clean air and water.
1260.35  Investigative requirements.
1260.36  Travel and transportation.
1260.37  Safety.
1260.38  Drug-Free Workplace.

Special Conditions

1260.50  Special conditions.
1260.51  Cooperative agreement special condition.
1260.52  Multiple year grant or cooperative agreement.
1260.53  Incremental funding.
1260.54  Cost sharing.
1260.55  Reports substitution.
1260.56  Withholding.
1260.57  New technology
1260.58  Designation of new technology representative and patent 
representative.
1260.59  Choice of law.
1260.60  Public information.
1260.61  Allocation of risk/liability.
1260.62  Payment--to foreign organizations.
1260.63  Customs clearance and visas.
1260.64  Taxes.
1260.65  Exchange of technical data and goods.
1260.66  Listing of reportable equipment and other property.
1260.67  Equipment and other property under grants with commercial 
firms.
1260.68  Invoices and payments under grants with commercial firms.
1260.69  Electronic funds transfer payment methods.

Post-Award Requirements

1260.70  Delegation of administration.
1260.71  Supplements and renewals.
1260.72  Adherence to original budget estimates.
1260.73  Transfers, novations, and change of name agreements.
1260.74  Property use, disposition, and vesting of title.
1260.75  Summary of report requirements.
1260.76  Termination and enforcement.
1260.77  Closeout procedures.

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Appendix to Subpart A to Part 1260--Listing of Exhibits

Subpart B--Uniform Administrative Requirements for Grants and 
Cooperative Agreements With Institutions of Higher Education, 
Hospitals, and Other Non-Profit Organizations

General

1260.101  Purpose.
1260.102  Definitions.
1260.103  Effect on other issuances.
1260.104  Deviations.
1260.105  Subawards.

Pre-Award Requirements

1260.110  Purpose.
1260.111  Pre-award policies.
1260.112  Forms for applying for Federal assistance.
1260.113  Debarment and suspension.
1260.114  Special award conditions.
1260.115  Metric system of measurement.
1260.116  Resource Conservation and Recovery Act (RCRA).
1260.117  Certifications and representations.

Post-Award Requirements

Financial and Program Management

1260.120  Purpose of financial and program management.
1260.121  Standards for financial management systems.
1260.122  Payment.
1260.123  Cost sharing or matching.
1260.124  Program income.
1260.125  Revision of budget and program plans.
1260.126  Non-Federal audits.
1260.127  Allowable costs.
1260.128  Period of availability of funds.

Property Standards

1260.130  Purpose of property standards.
1260.131  Insurance coverage.
1260.132  Real property.
1260.133  Federally-owned and exempt property.
1260.134  Equipment.
1260.135  Supplies and other expendable property.
1260.136  Intangible property.
1260.137  Property trust relationship.

Procurement Standards

1260.140  Purpose of procurement standards.
1260.141  Recipient responsibilities.
1260.142  Codes of conduct.
1260.143  Competition.
1260.144  Procurement procedures.
1260.145  Cost and price analysis.
1260.146  Procurement records.
1260.147  Contract administration.
1260.148  Contract provisions.

Reports and Records

1260.150  Purpose of reports and records.
1260.151  Monitoring and reporting program performance.
1260.152  Financial reporting.
1260.153  Retention and access requirements for records.

Termination and Enforcement

1260.160  Purpose of termination and enforcement.
1260.161  Termination.
1260.162  Enforcement.

After-the-Award Requirements

1260.170  Purpose.
1260.171  Closeout procedures.
1260.172  Subsequent adjustments and continuing responsibilities.
1260.173  Collections of amounts due.

Appendix A to Subpart B of Part 1260--Contract Provisions

    Authority: 42 U.S.C. 2473(c)(1), Pub. L. 97-258, 96 Stat. 1003 
(31 U.S.C. 6301 et seq.), and OMB Circular A-110.

Subpart A--General


Sec. 1260.1  Authority.

    (a) The National Aeronautics and Space Administration (NASA) awards 
grants and cooperative agreements under the authority of 42 U.S.C. 
2473(c)(5), the National Aeronautics and Space Act. This part 1260 is 
issued under the authority of 42 U.S.C. 2473(c)(1), Pub. L. 97-258, 96 
Stat. 1003 (31 U.S.C. 6301 et seq.), and OMB Circular A-110.
    (b) The Office of Management and Budget (OMB) approved information 
collection under the Paperwork Reduction Act and assigned OMB control 
numbers 2700-0047, Property Management and Control; 2700-0048, Patents; 
and 2700-0049, Financial Management and Control.


Sec. 1260.2  Purpose.

    (a) This subpart A of the NASA Grant and Cooperative Agreement 
Handbook (also subpart A of 14 CFR part 1260), provides supplemental 
NASA policies that clarify and amplify government-wide regulations for 
awarding and administering grants and cooperative agreements with 
educational and non-profit organizations. The government-wide 
regulations that this subpart supplements are set forth in OMB Circular 
A-110 ``Uniform Administrative Requirements for Grants and Agreements 
With Institutions of Higher Education, Hospitals, and Other Non-Profit 
Organizations.'' (NASA has adopted OMB Circular A-110 as subpart B of 
this part 1260.)
    (b) As required by the Office of Management and Budget (OMB), NASA 
has also adopted the standards set forth in OMB Circular No. A-133, 
Audits of States, Local Governments, and Non-Profit Organizations.


Sec. 1260.3  Definitions.

    (a) The following definitions are a supplement to the subpart B 
definitions set forth at Sec. 1260.102. Additional definitions 
applicable to specific categories of grants and cooperative agreements 
are set forth at 14 CFR 1273.3 and 14 CFR 1274.102.
    (b) Throughout subpart A to this part 1260, the term ``grant'' 
includes ``cooperative agreement'' unless otherwise indicated.
    Administrative grant officer means a Federal employee delegated 
responsibility for grant administration; e.g., a NASA grant officer who 
has retained grant administration responsibilities, or an Office of 
Naval Research (ONR) grant officer delegated grant administration by a 
NASA grant officer.
    Amendment means any document used to effect modifications to grants 
and cooperative agreements. Amendments may be issued unilaterally at 
the discretion of the grant officer.
    Commercial firm means any corporation, trust or other organization 
which is organized primarily for profit.
    Effective date means the date work can begin, which could be 
earlier or later than the date of signature on a basic award or 
modification. Expenditures made prior to award of a grant are incurred 
at the recipient's risk.
    Expiration date means the date of completion specified in the 
grant, after which expenditures may not be charged against the grant 
except to satisfy obligations to pay allowable costs committed on or 
before that date.
    Historically Black Colleges and Universities means institutions 
determined by the Secretary of Education to meet the requirements of 34 
CFR 608.2 and listed therein.
    Minority educational institution means an institution determined by 
the Secretary of Education to meet the requirements of 34 CFR 637.4.
    Non-profit organization means an organization that qualifies for 
the exemption from taxation under section 501 of the Internal Revenue 
Code of 1954, as amended, 26 U.S.C. 501.
    Progress report means a concise statement of work accomplished 
during the report period (see Secs. 1260.22 and 1260.75(b)(3)).
    Recipient acquired equipment means equipment purchased or 
fabricated with grant funds by a recipient for the performance of work 
under its grant.
    Small business concern means a concern, including its affiliates, 
which is independently owned and operated, not dominant in the field of 
operation in which it is bidding, and qualifies as a small business 
under the criteria and size standards in 13 CFR part 121.
    Small disadvantaged business concern means a small business concern 
owned and controlled by individuals

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who are both socially and economically disadvantaged and meets the 
criteria set forth at 13 CFR part 24.
    Summary of research means a document summarizing the results of the 
entire project, which includes bibliographies, abstracts, and lists of 
other media in which the research was discussed.
    Women-owned small business concern means a small business concern 
that is at least 51 percent owned by women who are U.S. citizens and 
who also control and operate the business (15 U.S.C. 637(d)).


Sec. 1260.4  Applicability.

    (a) Subparts A and B of this part 1260 establish policies and 
procedures for grants and cooperative agreements awarded by NASA to 
institutions of higher education, hospitals, and other non-profit 
organizations.
    (b) Subject to the special considerations in this paragraph, 
subparts A and B of this part 1260 are also applicable to NASA grants 
and cooperative agreements awarded to commercial firms which do not 
involve cost sharing. For grants and cooperative agreements with 
commercial organizations which involve resource contributions by the 
Recipient, see 14 CFR part 1274.
    (1) The allowability of costs incurred by commercial firms is 
determined in accordance with the provisions of the Federal Acquisition 
Regulation (FAR) at 48 CFR part 31.
    (2) NASA does not allow for payment of profit or fee to commercial 
firms under grant awards.
    (3) When applying the policies set forth under Sec. 1260.74, the 
grant officer shall vest title to any equipment purchased under the 
grant with the Government. The special condition at Sec. 1260.67, 
Equipment and Other Property Under Grants With Commercial Firms, shall 
be incorporated into all grants with commercial firms in place of the 
provision at Sec. 1260.27, Equipment and Other Property.
    (4) Due to differing NASA patent policies applicable to large 
businesses, special conditions at Sec. 1260.57, New Technology, and 
Sec. 1260.58, Designation of New Technology Representative and Patent 
Representative, shall be incorporated into all grants with commercial 
firms other than those with small businesses, in place of the provision 
at Sec. 1260.29, Patent Rights.
    (5) Payments under grants with commercial firms will be made based 
on incurred costs. NASA Form 272 is not required. Commercial firms will 
be required to submit invoices on a no more than quarterly basis. The 
special condition at Sec. 1260.68, Invoices and Payments Under Grants 
With Commercial Firms, shall be incorporated into all grants with 
commercial firms in place of the provision at Sec. 1260.26, Financial 
Management.
    (6) Payments will be made to commercial firms via electronic funds 
transfer. The special condition at Sec. 1260.69, Electronic Funds 
Transfer Payment Method, shall be incorporated into all grants with 
commercial firms.
    (7) Delegation of grant administration functions consistent with 
the policies set forth at Sec. 1260.70 (i.e., property administration 
and closeout are to be delegated) will be made to the cognizant field 
office of the Defense Contract Management Command instead of to the 
Office of Naval Research. Delegations will be made using NASA Form 
1674, Letter of Delegation, for the Administration of Grants and 
Cooperative Agreements (Exhibit F to subpart A of this part 1260, 
available at the address given in Exhibit F). Cognizant offices for 
performing administration under individual grants are set forth in the 
``DoD Directory of Contract Administration Services Components,'' which 
is available on the internet at: http://www.dcmc.hq.dla.mil/casbook/
casbook.htm.


Sec. 1260.5  Amendment.

    This part 1260 will be amended by publication of changes in the 
Federal Register. Changes will be issued as Grant Notices and 
incorporated into the official version of the handbook located at the 
internet web site.


Sec. 1260.6  Publication.

    The official site for accessing the NASA Grant and Cooperative 
Agreement Handbook, including current Grant Notices, is on the internet 
at: http://ec.msfc.nasa.gov/hq/grcover.htm


Sec. 1260.7  Deviations.

    (a) A deviation is required for any of the following:
    (1) When a prescribed provision (but not a special condition) set 
forth verbatim in this part 1260 is modified or omitted.
    (2) When a provision is set forth in this part 1260, but not for 
use verbatim, and the Center substitutes a provision which is 
inconsistent with the intent, principle, and substance of the 
provision.
    (3) When a form prescribed by this part 1260 is altered or another 
form is used in its place.
    (4) When limitations, imposed by this handbook upon the use of a 
grant provision, form, procedure, or any other grant action, are 
changed.
    (5) When a form is created for recipient use that constitutes a 
``Collection of Information'' within the meaning of the Paperwork 
Reduction Act (44 U.S.C. 35) and its implementation in 5 CFR part 1320.
    (b) Requests for authority to deviate from this part 1260 shall be 
submitted to the Office of Procurement, NASA Headquarters, Procurement 
Operations Division (HS). Requests, signed by the procurement officer, 
shall contain:
    (1) A full description of the deviation, the circumstances in which 
it will be used, and identification of the requirement from which a 
deviation is sought;
    (2) The rationale for the request, pertinent background 
information, and the intended effect of the deviation;
    (3) The name of the recipient, identification of the grant 
affected, and the dollar value;
    (4) A statement as to whether the deviation has been re quested 
previously, and, if so, details of that request; and
    (5) A copy of legal counsel's concurrence or comments.
    (c) Where it is necessary to obtain a deviation on OMB Circular A-
110 (subpart B of this part 1260), Code HS will process all necessary 
documents in accordance with 1260.104.

Pre-Award Requirements


Sec. 1260.10  Proposals.

    (a) Consistent with 31 U.S.C. 6301(3), NASA's policy is to use 
competitive procedures to award grants whenever possible. A grant can 
result from:
    (1) A proposal submitted in response to a Broad Agency Announcement 
(BAA) such as a NASA Research Announcement (NRA) or an Announcement of 
Opportunity (AO), a Cooperative Agreement Notice (CAN), an Agencywide 
program announcement such as the Graduate Student Research Program, or 
other forms of announcements approved by the Associate Administrator 
for Procurement (HS). NRA's are described in the NASA FAR Supplement 
(NFS) 48 CFR 1835.016. AO's are described in 48 CFR part 1872.
    (2) An Unsolicited Proposal for new and innovative ideas. Guidance 
on the submission of unsolicited proposals is contained in the Federal 
Acquisition Regulation (FAR) 48 CFR subpart 15.6 and (NFS) 48 CFR 
subpart 1815.6. The synopsis requirement in FAR part 5, however, does 
not apply to the grant process. Contact with NASA technical personnel 
prior to proposal submission

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is encouraged to determine if preparation of a proposal is warranted. 
These discussions should be limited to understanding NASA research 
needs and do not jeopardize the unsolicited status of any subsequently 
submitted proposal.
    (b) The proposal shall contain a detailed narrative description of 
the work to be undertaken, including the objectives of the project and 
the applicant's plan for carrying it out.
    (1) All proposals shall include budget data as prescribed in the 
Budget Summary (Exhibit A to subpart A of this part 1260, available at 
the address given in Exhibit A). Narrative detail must support the 
proposed budget as required in Exhibit A.
    (i) The recipient institution is responsible for ensuring that 
costs charged are allowable, allocable, and reasonable under the 
applicable cost principles governed by OMB Circular No. A-21 or A-122. 
For other details see 1260.127.
    (ii) Subject to applicable cost principles, facilities and 
administrative cost rates are negotiated between recipients and the 
cognizant agencies assigned under OMB Circular No. A-21. NASA is 
required to apply the applicable negotiated rate for all grants awarded 
to the recipient.
    (iii) NASA may accept cost sharing when voluntarily offered. For 
further guidance see 1260.123. For grants and cooperative agreements 
with commercial organizations that involve costs sharing, see 14 CFR 
part 1274. The amount of cost sharing will not be a factor in 
determining whether to select a proposal for award. However, recipients 
may be requested to secure nonfederal matching funds equal to the 
program portion of training and education grants. In accordance with 
NASA policy to foster continuity of research, multiple year grant 
proposals are encouraged, where appropriate, for a period generally up 
to three years. Proposals for multiple year grants shall describe the 
entire research project and include a complete budget for year one and 
separate estimates for each subsequent year.
    (2) A Taxpayer Identification Number (TIN) must be included with 
the address listed on the proposal. If an award is made, advance 
payments cannot be made without a TIN (31 U.S.C. 7702(c)(1)).
    (3) Prior to implementation of the Integrated Financial Management 
(IFM) System at each center, all grant and cooperative agreement 
recipients are required to register in the Department of Defense (DoD) 
Central Contractor Registeration (CCR) database. Registration is 
required in order to obtain a Commercial and Government Entity (CAGE) 
code, which will be used as a grant and cooperative agreement 
identification number for the new system. The grant officer shall 
verify that the prospective awardee is registered in the CCR database 
using the DUNS number or, if applicable, the DUNS+4 number, via the 
Internet at http://ccr.edi.disa.mil/ccr/cgi-bin/status.pl or by calling 
toll free: 800-841-4431, commercial: 696-961-5757.
    (c)(1) Grant officers are required to ensure that all necessary 
certifications, disclosures, and assurances have been obtained prior to 
awarding a grant or cooperative agreement.
    (2) Each new proposal shall include a certification for debarment 
and suspension under the requirements of 14 CFR 1265.510 and 1260.117.
    (3) Each new proposal for an award exceeding $100,000 shall include 
a certification, and a disclosure form (SF LLL) if required, on 
Lobbying under the requirements of 14 CFR 1271.110 and 1260.117.
    (4) Unless a copy is on file at the NASA center, recipients must 
furnish an assurance on NASA Form (NF) 1206 on compliance with Civil 
Rights statutes specified in 14 CFR parts 1250 through 1253.


Sec. 1260.11  Evaluation and selection.

    (a) Technical evaluation of proposals will be conducted by the 
cognizant NASA technical office and may be based on peer reviews.
    (b) Under NRA's, AO's, other BAA's, and CAN's, the selecting 
official will furnish documentation requested by the grant officer, 
(including a copy of the NRA, selection statement, and peer review 
evaluation if requested), to confirm that the award is being made as a 
result of a selection under a NRA, AO, other BAA, or CAN. The technical 
office will forward to the grant office a completed award package, 
including a funded procurement request, technical evaluation of the 
proposed budget, and other support documentation, at least 29 days 
prior to the requested award date, or before the expiration of the 
funded period in the case of the renewal of an existing effort.
    (c) If a proposal is not selected, the proposer will be notified by 
the selecting official in accordance with the procedures set forth in 
the NRA, AO, CAN, or BAA.
    (d) Unsolicited proposals will be evaluated in accordance with the 
following procedure:
    (1) Evaluations of unsolicited proposals to be awarded as grants or 
cooperative agreements will be conducted using the same criteria used 
for reviewing unsolicited proposals to be awarded as contracts, as set 
forth at FAR subpart 15.6 and (NFS) 48 CFR subpart 1815.6. Normally, 
unsolicited proposals are accepted to perform discrete projects with 
defined anticipated outcomes and completion dates. An unsolicited 
proposal that results in a grant or cooperative agreement with no 
defined end date, and which requires subsequent submission of follow-on 
unsolicited proposals to ensure continuation of the effort, should be 
closely reviewed to ensure that it meets the FAR definition for a valid 
unsolicited proposal.
    (2) An unsolicited proposal recommended for acceptance shall be 
supported by a Justification for Acceptance of an Unsolicited Proposal 
(JAUP) prepared by the cognizant technical office. The JAUP shall be 
submitted for the approval of the grant officer after review and 
concurrence at a level above the technical officer. However, this 
review and concurrence is not required for technical officers at a 
division chief or higher level. The grant officer's signature on the 
award document will indicate approval of the JAUP.
    (3) NASA will notify in writing organizations that submit 
unsolicited proposals that will not be funded. Method of notification 
is at the discretion of the grant officer. Proposals will be returned 
only when requested. Agency procedures for handling unsolicited 
proposals are specified at (NFS) 48 CFR 1815.606.
    (e) For awards made non-competitively, written justifications for 
equipment or travel will be submitted by the technical office for grant 
officer approval when more than half of the proposed budget is for 
equipment or travel and associated indirect cost. The justification 
shall describe the extent to which the equipment or travel is 
necessary. The grant officer's signature on the award will indicate 
approval of the justification.
    (f) The evaluation of the proposal budget will conform to the 
following procedure:
    (1) The technical officer will review the proposer's estimated cost 
for conformance to program requirements and fund availability. The 
results of this review shall be recorded in Column B of the proposed 
Budget Summary Form (Exhibit A to subpart A of this part 1260, 
available at the address given in Exhibit A). New budgets are not 
required when the program office recommended funding is within twenty 
percent (20 percent) of the proposed amount, provided specific proposed

[[Page 50338]]

objectives have not been added or deleted. However, when funding 
decreases in equipment and/or subcontracts are involved, the cognizant 
program office is required to identify the cost element(s) affected by 
the change in funding level.
    (2) The grant officer will review the budget, and any changes made 
by the technical officer, to identify any item which may be unallowable 
under the cost principles, or which appears unreasonable or 
unnecessary. The grant officer will complete Column C of the Budget 
Summary after discussing significant changes with the recipient and/or 
technical office. Requests for details from the recipient should be 
limited.
    (3) The grant officer will address requests for direct charge of 
equipment in the negotiation summary, and state whether the purchase is 
approved as a direct cost.
    (g) 42 U.S.C. 2459d prohibits NASA from funding any grant for 
longer than one year if the effect is to provide a guaranteed customer 
base for new commercial space hardware or services. The only exception 
would be if an Appropriations Act specifies the new commercial space 
hardware or services to be used.
    (h) NASA reserves the right to either fully fund or incrementally 
fund grants based on fiscal law and program considerations. Grants with 
anticipated annual funding exceeding $50,000 may be funded for less 
than the amount stated in the proposal.
    (1) The grant officer will determine the number of incremental 
funding actions that will be allowed.
    (2) The special condition at Sec. 1260.53, Incremental Funding, 
will be included in the grant.
    (i) Proposals for efforts that involve printing, binding, and 
duplicating in excess of 25,000 pages are subject to the Government 
Printing and Binding Regulations, No. 26, February 1990, S. Pub. 101-9, 
U.S. Government Printing Office, Washington, DC 20402, published by the 
Congressional Joint Committee on Printing. The technical office will 
refer such proposals to the Installation Central Printing Management 
Officer (ICPMO). The grant officer will be advised in writing of the 
results of the ICPMO review.
    (j) The provision at Sec. 1260.30, Rights in Data, is adequate only 
for grants for basic or applied research where the principal purpose 
(or only expected NASA involvement) is the publication or dissemination 
of the results, such as in journals or NASA publications (see 
Sec. 1260.22). Rights in data for other types of grants and cooperative 
agreements should be developed with Center Patent Counsel on a case-by-
case basis.
    (k) By acceptance of a grant (containing the provision at 
Sec. 1260.34) the recipient agrees that it is in compliance with the 
Clean Air and Federal Water Pollution Control Acts. The Administrator 
may approve exemptions from this prohibition under certain 
circumstances under Executive Order 11738. Requests for exemptions or 
renewals thereof shall be made to the Office of Procurement, NASA 
Headquarters, Program Operations Division (Code HS), Washington, DC 
20546.
    (l) Requests for acquisition of property may be made by a recipient 
either as part of the original budget proposal or subsequent to award. 
Comprehensive guidance on evaluating requests for acquisition of 
property, vesting of title, and administration issues, is set forth at 
Sec. 1260.74.


Sec. 1260.12  Choice of award instrument.

    (a) This section and Sec. 1260.111 provide guidance on the 
appropriate choice of award instruments consistent with 31 U.S.C. 6301 
to 6308. Throughout Sec. 1260.12, the term ``grant'' does not include 
``cooperative agreements.''
    (b)(1) A procurement contract is a mutually binding legal 
relationship obligating the seller to furnish supplies or services 
(including construction), and the buyer pays for them.
    (2) The principal purpose of a procurement contract is to acquire, 
for NASA's direct use or benefit, a well-defined, specific effort 
clearly required for the accomplishment of a scheduled NASA mission or 
project.
    (3) If it is determined that a procurement contract is the 
appropriate type of funding instrument to meet NASA's purposes, the 
procurement shall be conducted under the FAR and the NFS (48 CFR 
chapter 18).
    (4) If an action is to be awarded for a dollar amount below the 
simplified acquisition threshold, the action may be completed by a 
contracting officer as a purchase order. The purchase order must be 
properly modified to include necessary language pertaining to data 
rights, key personnel requirements, and any other necessary 
requirements as determined by the contracting officer.
    (c) A grant shall be used as the legal instrument to reflect a 
relationship between NASA and a recipient whenever the principal 
purpose is the transfer of anything of value to the recipient to 
accomplish a public purpose of support or stimulation authorized by 
Federal statute. Grants are distinguished from cooperative agreements 
in that substantial involvement is not expected between NASA and the 
recipient when carrying out the activity. Grants are distinguished from 
contracts in that grants provide financial assistance to the recipient 
to conduct a fairly autonomous program; contracts entail acquisition. 
Various types of NASA grants contain different provisions and 
conditions as described in Secs. 1260.20 and 1260.50. The major types 
of grants and cooperative agreements are defined as follows. Grants and 
cooperative agreements to carry out other authorized purposes should be 
used to the extent appropriate, and must be in compliance with OMB 
Circular A-110.
    (1) Research grant. A research grant shall be used to accomplish a 
NASA objective through stimulating or supporting the acquisition of 
knowledge or understanding of the subject or phenomena under study, or 
attempting to determine and exploit the potential of scientific 
discoveries or improvements in technology, materials, processes, 
methods, devices, or techniques and advance the state of the art. The 
recipient will bear prime responsibility for the conduct of research, 
and exercises judgment and original thought toward attaining the 
scientific goals within broad parameters of the research areas proposed 
and the resources provided;
    (2) Education grant. An education grant is an agreement that 
provides funds to an educational institution or other nonprofit 
organizations within one or more of the following areas:
    (i) Capturing student interest and/or improving student performance 
in science, mathematics, technology, or related fields;
    (ii) Enhancing the skill, knowledge, or ability of teachers or 
faculty members in science, mathematics, or technology;
    (iii) Supporting national educational reform movements;
    (iv) Conducting pilot programs or research to increase 
participation and/or to enhance performance in science, mathematics, or 
technology education at all levels; and
    (v) Developing instructional materials (e.g., teacher guides, 
printed publications, computer software, and videotapes) or networked 
information services for education;
    (3) Training grant. A training grant is an agreement that provides 
funds primarily for scholarships, fellowships, or stipends to students, 
teachers, and/or faculty.
    (i) NASA training grants are awarded to colleges, universities, or 
other non-profit organizations; not to individual students, teachers, 
or faculty members.

[[Page 50339]]

It is the responsibility of the institution receiving the grant to 
approve the faculty, teachers, and/or students who will participate in 
the specific program, in cooperation with NASA. If a student, teacher, 
or faculty member ceases to participate in the program for any reason, 
the institution, with prior NASA approval, may appoint another student, 
teacher, or faculty member to complete the remaining portion of the 
grant period. Replacement students, teachers, and/or faculty electing 
to apply for the following program year are not automatically entitled 
to an award and are subject to the evaluation/selection procedures 
administered to new applicants. Any participant receiving support under 
a NASA training grant may not concurrently hold another Federal 
fellowship or traineeship.
    (ii) No applicant shall be denied consideration or appointment on 
the grounds of race, creed, color, national origin, age, sex, or 
disability.
    (iii) Students and faculty receiving direct support under a NASA 
training grant must be U.S. citizens, except for those supported by the 
NASA Earth System Science Fellowship Program, the Graduate Student 
Fellowship in Global Change Research Program, and the GLOBE Program.
    (iv) Duration of the award is program specific. Refer to program 
policies and procedures for details. Renewal is contingent upon a 
successful performance evaluation as prescribed by the program, 
concurrence by the NASA technical officer, and the availability of 
funds.
    (v) No substantial involvement is expected between NASA and the 
recipient. A student or faculty member receiving support under a NASA 
training grant does not incur any formal obligation to the Government.
    (vi) The use of training grant funds to acquire equipment, or to 
acquire or construct facilities will not be permitted. Government 
furnished equipment will not be provided.
    (vii) An Administrative Report must be submitted under the 
guidelines described by the specific program policies and procedures.
    (4) Facilities grant. A facilities grant is used to provide for the 
acquisition, construction, use, maintenance, and disposition of 
facilities. Facilities, as used in this section, means property used 
for production, maintenance, research, development, or testing. Prior 
approval by the Associate Administrator of Procurement is required 
before proceeding with a facilities grant. To obtain prior approval, a 
package will be forwarded to the Director, Program Operations Division 
(HS), during the planning phase of the grant, that includes pertinent 
background information, details on Congressional Authorization, dollar 
value, and name of the recipient. Other information, such as a copy of 
the proposed facility grant award document, is not required. It is 
unlikely an award will be approved unless specifically authorized by 
Congress. A review by legal counsel to assure legal sufficiency is also 
required.
    (d) Cooperative agreement. A cooperative agreement shall be used as 
the legal instrument reflecting a relationship between NASA and a 
recipient whenever the principal purpose is the transfer of anything of 
value to the recipient to accomplish a public purpose of support or 
stimulation authorized by Federal statute, and substantial involvement 
is anticipated between NASA and the recipient during performance of the 
contemplated activity (31 U.S.C. 6305). Characteristics inherent in a 
cooperative agreement include those that apply to a grant, plus the 
following:
    (1) Substantial NASA involvement in and contribution to the 
technical aspects of the effort are necessary for its accomplishment. 
This could involve an active NASA role in collaborative relations, 
access to a NASA site or equipment, or sharing NASA facilities and 
personnel. For example, a university investigator could work for a 
substantial amount of time at a NASA Center, a NASA investigator could 
work at a university, or when the collaboration is such that a jointly 
authored report or education curriculum product is appropriate;
    (2) The project, conducted as proposed, would not be possible 
without extensive NASA-recipient technical collaboration;
    (3) The nature of the collaboration shall be clearly defined and 
specified in the special condition at Sec. 1260.51.
    (e)(1) Grants and cooperative agreements with foreign 
organizations. Grants and cooperative agreements with foreign 
organizations provide for research to be performed in whole, or in 
part, by a foreign organization, with funding being provided by NASA to 
the foreign organization as reimbursement for the work performed.
    (2) It is NASA policy that, in general, research with foreign 
organizations will not be conducted through grants or cooperative 
agreements, but instead will be accomplished on a no-exchange-of-funds 
basis. In these cases, NASA enters into agreements undertaking projects 
of international scientific collaboration. In rare instances, NASA may 
enter into an international agreement under which funds will be 
transferred to a foreign recipient.
    (3) Grants and cooperative agreements to foreign organization are 
made on an exceptional basis only. Awards require the prior approval of 
the Headquarters Office of External Relations (Code I) and the 
Headquarters Office of the General Counsel (Code G). Requests to award 
foreign grants or cooperative agreements are to be coordinated through 
the Office of Procurement, Program Operations Division (Code HS). 
Requests for approval shall contain:
    (i) The identity of the foreign entity, the country or countries 
involved, and the purpose of the grant or cooperative agreement.
    (ii) The Space Act Agreement(s) or underlying international 
agreement involved, if any.
    (iii) A description of the effort to be undertaken by the entity 
described in paragraph (e)(3)(i) of this section, including their 
dollar value.
    (iv) The reason why the grant or cooperative agreement requires a 
placement with a foreign organization.
    (v) The reason why the work can not be accomplished on a no 
exchange of funds basis.
    (4) Grants and cooperative agreements to foreign organizations 
require a review by the Office of General Counsel.
    (5) The requirements of this section do not apply to the purchase 
of supplies or services (excluding research) from non-U.S. sources by 
U.S. grant or cooperative agreement recipients, when necessary to 
support research efforts.
    (f)(1) The decision whether to use a contract, grant or cooperative 
agreement as an award instrument must be based on the principal purpose 
of the relationship. When NASA, within its authority, enters into a 
transaction where the principal purpose is to accomplish a public 
purpose of support or stimulation authorized by Federal statute, a 
grant or a cooperative agreement is the appropriate instrument. 
Conversely, if the principal purpose of a transaction is to accomplish 
a NASA requirement, i.e., to produce something for NASA's own use, a 
procurement contract is the appropriate instrument. Two essential 
questions must be asked to ensure that a grant or cooperative agreement 
is the appropriate instrument. The first question is: Will NASA be 
directly harmed in furthering a specific NASA mission requirement if 
the effort is not accomplished? The answer to this question must be 
``no.'' The second question is: Is the work being performed by the 
recipient primarily for its own purposes, which NASA is merely 
supporting with financial or other

[[Page 50340]]

assistance? The answer to this question must be ``yes.'' If these 
criteria are met, then the effort is not a NASA requirement, and can 
then be considered as to whether it supports or stimulates a public 
purpose.
    (2) In applying the principal purpose test, it must be determined 
whether the Government is the direct beneficiary or user of the 
activity. If NASA provides the specifications for the project; or is 
having the project completed based on its own identified needs; or will 
directly use the report or result of the project for a scheduled NASA 
mission, then, in most cases, the principal purpose is to acquire 
property or services for the direct benefit or use of NASA, and thus, a 
contractual relationship exists. However, there may be cases where NASA 
expects to derive some incidental use or benefit from funded 
activities. In fact, any extramural expenditure that furthers the 
Agency's goals or mission can be said to be of benefit or use to the 
Government. But not every expenditure produces for the Government a 
benefit or use that is direct; i.e., immediate, uninterrupted, or 
specific. Where an expenditure will produce a benefit or use that is 
only indirect in nature, a grant or cooperative agreement may be used.
    (3) The status of the entity involved is not a primary factor in 
determining the appropriate award instrument. For example, an entity 
that operates on a non-profit basis may receive funding through a 
contract, and is not limited to receiving grants or cooperative 
agreements. Similarly, a profit-making firm may receive funding through 
grants, cooperative agreements, or contracts.
    (4) NASA offices may be mandated through their missions to support 
specific scientific, educational, or training programs. The office may 
be accountable to NASA management, the Administration, or Congress for 
oversight and proper implementation of the program, may require direct 
oversight, may be directly accountable for the results of the program 
and that the work be successfully completed. Whenever the office 
requesting the grant or cooperative agreement would be directly harmed 
in performing its mission if an award was not made, a grant or 
cooperative agreement is not appropriate. Specific examples of 
situations requiring special scrutiny include--
    (i) Education grants that for the administration of a program for 
which the education office is directly responsible;
    (ii) Research or education grants to establish and support 
university laboratories on a non-competitive basis, with the resulting 
work of direct benefit to NASA; or
    (iii) Training grants that hire university students, on a non-
competitive basis, to perform work at a NASA Center in direct support 
of NASA personnel, and perform work which is required in support of a 
NASA mission.
    (5) A grant may be used to provide funding to an association to 
hold a conference (among its members and NASA officials) where the 
benefits flow primarily to the association and its members, not to 
NASA. The principal purpose will be to advance research or other 
purposes of the association. Thus, NASA may not direct an association 
in arranging the conference or in providing other services for NASA's 
benefit. The conference should be run by the association, not by NASA. 
Conferences sponsored or initiated by NASA primarily to meet a specific 
NASA need or obtain information for the direct benefit of NASA must be 
supported by means of a contract.


Sec. 1260.13  Award procedures.

    (a) Award instruments are classified as follows:
    (1) Annual grants are grants awarded for a short term (e.g., on an 
annual basis).
    (2) Multiple year grants support research projects that may span 
several years.
    NASA policy is to make maximum use of multiple year grants. A 
Multiple Year Grant is generally selected for a period of three years 
in keeping with NASA's policy calling for research to be peer reviewed 
at least every three years. Grants with periods of performance in 
excess of three years may be appropriate when the NASA technical office 
determines at the inception of the grant that a period of performance 
in excess of three years is necessary to complete a discrete research 
effort.
    (i) If the decision to provide multiple year funding to a research 
proposal is made, the special condition at Sec. 1260.52, Multiple Year 
Grant or Cooperative Agreement, will be included in the award.
    (ii) Periods approved under the Multiple Year Grant or Cooperative 
Agreement special condition at Sec. 1260.52, and funded at the levels 
specified in the special condition, are not considered to be new 
awards. Therefore, new proposals, new proposal-related certifications 
(such as Disclosure of Lobbying Activities, and Debarment and 
Suspension), new technical evaluations, and new budget proposals are 
not required, as long as this information for the multiple year period 
was reviewed and approved as part of the original proposal.
    (iii) If NASA program constraints or developments within the 
research project dictate a reduction in the funding level specified 
under a Multiple Year Grant period, research may continue at the 
reduced level under the terms of the provisions; however, the recipient 
may rebudget under the grant provisions to keep the project within the 
funding actually provided.
    (3) An augmentation to a grant may be issued as a supplement at any 
time when work is introduced which is outside the scope of the approved 
proposal or when there is a need for substantial unanticipated funding. 
Augmentations require the submission of revised budget proposals and 
technical evaluations covering the additional work. Since augmentations 
will be performed within the existing period of performance, 
certifications will not normally be required.
    (4) A grant extension may be placed to extend the grant beyond the 
expiration date, in accordance with the provision at Sec. 1260.23, 
Extensions, if additional time beyond the established period of 
performance is required to assure adequate completion of the original 
scope of work within the available funding.
    (5) Grant renewals provide for continuation of research beyond the 
original scope, period of performance and funding levels; therefore, 
new proposals, certifications and technical evaluations are required 
prior to the execution of a grant renewal. Grant renewals will be 
awarded as new grants. Continued performance within a period specified 
under the Multiple Year Grant provision does not constitute a renewal. 
For research originally awarded through a competitive NRA, CAN, or 
other competitive announcement that has completed its period of 
performance, peer review of a proposal to continue the research should 
be accomplished prior to selecting the research grant for renewal. If 
the effort was originally awarded through an unsolicited proposal, a 
new justification to accept the unsolicited proposal would be required 
(however, also see Sec. 1260.12(g)(5)). Multiple year grant special 
conditions may be incorporated into renewals.
    (b) While NASA normally provides full funding support for research 
grants, alternate methods of grant funding are as follows:
    (1) Since NASA grant recipients usually gain no measurable 
commercial or economic benefit from grants, other than conducting 
research, cost sharing for research grants is not generally

[[Page 50341]]

required. NASA may, however, accept cost sharing when voluntarily 
offered. Additionally, in instances when the grant officer determines 
that the recipient will benefit from the research results through sales 
to non-Federal entities, cost sharing based upon this mutuality of 
interest will apply. See Sec. 1260.123. When cost sharing is used, the 
grant officer shall insert a Special Condition substantially as shown 
in Sec. 1260.54, Cost Sharing. (See 14 CFR part 1274 for grants and 
cooperative agreements with commercial organizations involving cost 
sharing.)
    (2) NASA may provide partial support for a research project or 
conference where additional funding is being provided by other Federal 
agencies. If the grant also involves cost sharing by the recipient, the 
grant officer will ensure that the recipient's share does not include 
any Federal funds.


Sec. 1260.14  Limitations.

    (a) NASA does not award grants merely to provide donative 
assistance no matter how worthy the purpose, but to the extent that 
appropriations are available to carry out authorized Agency programs. 
Research in any academic discipline related to NASA interests normally 
will qualify. However, advice of legal counsel should be sought in 
unusual situations, or when unusual project activities or 
organizational attributes are evident.
    (b) It is NASA's policy that non-monetary (zero dollar) grants or 
cooperative agreements shall not be used, except for no-cost 
extensions.
    (c) Loans of Government personal property not associated with a 
contract, grant, or cooperative agreement under 31 U.S.C. 6301 to 6308, 
and made under the Space Act of 1958, should be consummated as loan 
agreements. Also, excess Government research property may be donated to 
educational institutions and nonprofit organizations pursuant to 15 
U.S.C. 3710(I). See Sec. 51260.133(a)(2).
    (d) Neither grants nor cooperative agreements shall be used as 
legal instruments for consulting service arrangements.


Sec. 1260.15  Format and numbering.

    (a) A grant shall be brief, containing only those provisions and 
special conditions necessary to protect the interests of the 
Government.
    (b) Cover page formats shown in Exhibit B to subpart A of part 1260 
shall be used for all NASA grant and cooperative agreement award 
documents. Provisions for grants with U.S. organizations shall be 
incorporated by reference, and preprinted checklists may be used 
(Exhibit C to subpart A of this part 1260). Both special conditions and 
provisions for grants with foreign organizations will be printed in 
full text. An acceptance block may be added when the grant officer 
finds it necessary to require bilateral execution of the grant. Program 
budgets are not generally attached to the award document. When it is 
necessary to attach the budget due to revisions to the original 
proposed budget or other reasons, this information should be suitably 
marked as confidential, and is not be disclosed outside of the 
Government without the consent of the grantee.
    (c) The Identification Numbering System to be used prior to 
Integrated Financial Management Project (IFMP) implementation will be 
applied as follows:
    (1) For research, education, and facilities grants, numbering shall 
conform to (NFS) 48 CFR 1804.7102(a) by including the Center 
Identification Number, except that a NAG prefix will be used in lieu of 
the NAS prefix (e.g., NAG5 would be the Goddard prefix designation). 
They will be sequentially numbered.
    (2) Cooperative agreements will use the prefix NCC plus the Center 
Identification Number. They will be sequentially numbered.
    (3) Training grants will use the prefix NGT plus the Center 
Identification Number. They will be sequentially numbered.
    (4) The Catalog of Federal Domestic Assistance (CFDA) Numbers does 
not apply to NASA grants.
    (d) The Identification Numbering System will be revised after IFMP 
implementation. There will be a phase-in term for Center implementation 
of the IFMP. For centers using IFMP Performance Purchasing; the 
following numbering system shall be used:
    (1) Document Type for grants. For research, education, facilities, 
and training grants, the document type prefix GR shall be used.
    (2) Document Type for cooperative agreements. Cooperative 
agreements will use the prefix CO.
    (3) Agency Identifier. The Agency identifier NAS shall follow the 
document number.
    (4) Center Smart Codes. The Center identifier shall follow the 
document type:

------------------------------------------------------------------------
                 Installation                          Smart code
------------------------------------------------------------------------
Ames Research Center.........................  A
Dryden Flight Research Center................  D
Glenn Research Center........................  C
Goddard Space Flight Center..................  G
Headquarters.................................  H
Johnson Space Center.........................  J
Kennedy Space Center.........................  K
Langley Research Center......................  L
Marshall Space Flight Center.................  M
NASA Management Office-JPL...................  P
Stennis Space Center.........................  S
------------------------------------------------------------------------

    (5) Fiscal Year. The fiscal year shall be represented as two 
digits.
    (6) Procurement Code. ``G'' will be used as the procurement code to 
identify grants. Cooperative Agreements will be identified using ``A'' 
as the procurement code.
    (7) Serial Numbers. Installations shall number grants and 
cooperative agreements serially by fiscal year. The serial number shall 
be six digits commencing with ``000001'' and continuing in succession.
    (8) As an example of the above set forth methodology, the first two 
grants awarded by Marshall Space Flight Center in fiscal year 1999 
would be GRNASM99G000001 and GRNASM99G000002.
    (9) The Catalog of Federal Domestic Assistance (CFDA) Numbers does 
not apply to NASA grants.


Sec. 1260.16   Distribution.

    (a) Copies of grants and supplements will be provided to--
    (1) Payment offices (original copy);
    (2) Technical officers;
    (3) Administrative grant officers when delegated;
    (4) The NASA Center for AeroSpace Information (CASI), Attn: 
Document Processing Section, 7121 Standard Drive, Hanover, MD 21076; 
and
    (5) Other appropriate offices as determined by the grant officer.
    (b) In addition to receipt of grants and supplements, the 
administrative grant officer will receive a copy of the approved 
budget.
    (c) The file will record the addresses for distribution.

Provisions


Sec. 1260.20   Provisions.

    (a) Research grants, education grants, and cooperative agreements 
with U.S. educational institutions and nonprofit organizations shall 
incorporate by reference the provisions set forth in Secs. 1260.21 
through 1260.38. Training grants shall incorporate by reference the 
provisions set forth in Secs. 1260.21 through 1260.38, except that the 
grant officer will substitute Sec. 1260.22, Technical Publications and 
Reports, with reporting requirements as specified by the program 
office.

[[Page 50342]]

    (b) Facilities grants provisions will be selected on a case-by-case 
basis (please refer to Sec. 1260.50).
    (c) Research grants awarded to foreign organizations, when approved 
by Headquarters, will include the following provisions at a minimum: 
Secs. 1260.21, 1260.22, 1260.23, 1260.24, 1260.25, 1260.26, 1260.27, 
1260.29, 1260.33, 1260.35, 1260.36 and 1260.37. Additional special 
conditions will be selected on a case by case basis (please refer to 
1260.50). All provisions will be provided in full text. Referenced 
handbooks, statutes, or other regulations, which the recipient may not 
have access to, must be made available when requested by the foreign 
organization.
    (d) The provisions set forth at Sec. 1260.21 through 1260.38 do not 
apply to awards made under the Federal Demonstration Partnership (FDP). 
FDP awards are subject to the FDP Phase III General Terms and 
Conditions and the NASA Agency Specific Requirements Modifications to 
the General Terms and Conditions (Exhibit D to subpart A of this part 
1260). Since these documents are provided directly to the FDP 
institutions, they are not to be attached to FDP grants. However, the 
grant officer will include a statement similar to the following on FDP 
grants: ``The Federal Demonstration Partnership General Terms and 
Conditions and NASA Agency-specific Requirements apply to this award.''
    (e) Grants or cooperative agreements awarded by NASA to the 
Commercial Space Centers under the Space Development and Commercial 
Research (SDCR) Program require special conditions in addition to those 
set forth at Secs. 1260.21 through 1260.38. SDCR Special Conditions are 
required to be included in full text for all SDCR Grants and 
Cooperative Agreements (Exhibit E to subpart A of this part 1260). 
Changes or additions to these Special Conditions must be approved by 
the Office of Space Utilization and Product Development (Code UM) prior 
to the award of the grant. Requests for changes or additions are to be 
coordinated through the Office of Procurement, Program Operations 
Division (Code HS).
    (f) Grants and cooperative agreements awarded by NASA to commercial 
organizations where cost sharing is not required shall incorporate the 
provisions set forth at Secs. 1260.21 through 1260.38, modified as set 
forth under Sec. 1260.4(b).
    (g) Grants and cooperative agreements not specifically classified 
elsewhere in this section, but that are awarded for other authorized 
purposes, shall include provisions selected on a case-by-case basis.
    (h) Whenever the word ``grant'' appears in Secs. 1260.21 through 
1260.38, it shall be deemed to include, as appropriate, the term 
``cooperative agreement.''


Sec. 1260.21   Compliance with OMB Circular A-110.

Compliance With OMB Circular A-110 (Date)

    This grant or cooperative agreement is subject to the 
requirements set forth in OMB Circular A-110, Uniform Administrative 
Requirements for Grants and Agreements with Institutions of Higher 
Education, Hospitals, and Other Non-Profit Organizations. Recipients 
are required to comply with the requirements of A-110, as adopted by 
NASA as subpart B of part 1260 of title 14 of the Code of Federal 
Regulations. Specific provisions set forth in this award document 
are provided to supplement and clarify, not replace, the Circular, 
except in circumstances where a waiver from Circular requirements 
has been obtained by NASA.

[End of provision]


Sec. 1260.22   Technical publications and reports.

    (This provision describes standard reporting requirements that 
should be applied in most circumstances. The requirements set forth 
under this provision may be modified by the grant officer based on 
specific report needs for the grant or cooperative agreement, provided 
that reporting requirements do not conflict with Sec. 1260.151. Any 
special reporting requirements will be set forth as a special condition 
in the award document.)

Technical Publications and Reports (Date)

    (a) NASA encourages the widest practicable dissemination of 
research results at any time during the course of the investigation. 
All information disseminated as a result of the grant shall contain 
a statement which acknowledges NASA's support and identifies the 
grant by number (e.g., ``The material is based upon work supported 
by NASA under award No(s) GRNASM99G000001, etc.'').
    (b) Reports shall be in the English language, informal in 
nature, and ordinarily not exceed three pages (not counting 
bibliographies, abstracts, and lists of other media). The recipient 
shall submit the following reports:
    (1) A Progress Report for all but the final year of the grant. 
Each report is due 60 days before the anniversary date of the grant 
and shall briefly describe what was accomplished during the 
reporting period as outlined in Sec. 1260.151(d). A special 
condition specifying more frequent reporting may be required.
    (2) A Summary of Research (or Educational Activity Report in the 
case of Education Grants) is due within 90 days after the expiration 
date of the grant, regardless of whether or not support is continued 
under another grant. This report shall be a comprehensive summary of 
significant accomplishments during the duration of the grant.
    (c) Progress Reports, Summaries of Research, and Educational 
Activity Reports shall include the following on the first page:
    (1) Title of the grant.
    (2) Type of report.
    (3) Name of the principal investigator.
    (4) Period covered by the report.
    (5) Name and address of the recipient's institution.
    (6) Grant number.
    (d) Progress Reports, Summaries of Research, and Educational 
Activity Reports shall be distributed as follows:
    (1) The original report, in both hard copy and electronic 
format, to the Technical Officer.
    (2) One copy to the NASA Grant Officer, with a notice to the 
Administrative Grant Officer, (when administration of the grant has 
been delegated to ONR), that a report was sent.
    (e) For Summaries of Research and published reports, one 
microreproducible copy shall also be sent to the NASA Center for 
AeroSpace Information (CASI), Attn: Document Processing Section, 7121 
Standard Drive, Hanover, MD 21076.

[End of provision]


Sec. 1260.23   Extensions.

Extensions (Date)

    (a) It is NASA policy to provide maximum possible continuity in 
funding grant-supported research and educational activities, 
therefore, grants may be extended for additional periods of time 
when necessary to complete work that was part of the original award. 
NASA generally only approves such extensions within funds already 
made available. Any extension that would require additional funding 
must be supported by a proposal submitted at least three months in 
advance of the expiration date of the grant.
    (b) In accordance with Sec. 1260.125(e)(2), Recipients may 
extend the expiration date of a grant if additional time beyond the 
established expiration date is required to assure adequate 
completion of the original scope of work within the funds already 
made available. For this purpose, the recipient may make a one-time 
no-cost extension, not to exceed 12 months, prior to the established 
expiration date. Written notification of such an extension request, 
with the supporting reasons, must be received by the NASA Grant 
Officer at least ten days prior to the expiration of the award. A 
copy of the extension request must also be forwarded to cognizant 
Office of Naval Research office. NASA reserves the right to 
disapprove the extension if the requirements set forth at 
Sec. 1260.125(e)(2) are not met.
    (c) Requests for approval for all other no-cost extensions must 
be submitted in writing to the NASA Grant Officer. Copies are to be 
forwarded to the cognizant Office of Naval Research office.

[End of provision]

[[Page 50343]]

Sec. 1260.24   Termination and enforcement.

Termination and Enforcement (Date)

    As a clarification to the termination and enforcement conditions 
of this award specified in Secs. 1260.160 through 1260.162, although 
NASA's policy is to consult with the recipient, NASA reserves the 
right to suspend or terminate the award without prior notice when it 
believes such action is necessary to protect the interest of the 
Government.

[End of provision]


Sec. 1260.25   Change in principal investigator or scope.

Change in Principal Investigator or Scope (Date)

    The following guidance is provided as an amplification to prior 
approval requirements set forth at Sec. 1260.125(c):
    (a) The Recipient shall obtain the approval of the NASA Grant 
Officer for a change of the principal investigator, or for a 
significant absence of the Principal Investigator from the project, 
defined as a three month absence from the program or a 25 percent 
reduction in time devoted to the project. Significantly reduced 
availability of the services of the principal investigator(s) named 
in the grant instrument could be grounds for termination, unless 
alternative arrangements are made and approved in writing by the 
Grant Officer.
    (b) Prior written approval is required from NASA if there is to 
be a significant change in the objective or scope.

[End of provision]


Sec. 1260.26  Financial management.

Financial Management (Date)

    (a) Advance payments by electronic funds transfer will be made 
by the Financial Management Office of the NASA Center which issued 
the grant in accordance with procedures provided to the recipient. 
The recipient shall submit Federal Cash Transaction Reports (SF 272) 
to the aforementioned office and to the Administrative Grant Officer 
(if NASA has delegated administration) within 15 working days 
following the end of each Federal fiscal quarter, containing current 
estimates of the cash requirements for each of the four months 
following the quarter being reported. The final SF 272 is due within 
90 days after the expiration date of the grant. The final SF 272 
shall be submitted to the Financial Management Office, with copies 
sent to the NASA Grant Officer, and to the Administrative Grant 
Officer when the Office of Naval Research (ONR) has been delegated 
grant closeout responsibilities.
    (b) Unless otherwise directed by the Grant Officer, any 
unexpended balance of funds which remains at the end of any funding 
period, except the final funding period of the grant, shall be 
carried over to the next funding period, and may be used to defray 
costs of any funding period of the grant. This includes allowing the 
carry over of funds to the second and subsequent years of a multiple 
year grant. This provision also applies to subcontractors performing 
substantive work under the grant. For grant renewals, the estimated 
amount of unexpended funds shall be identified in the grant budget 
section of the recipient's renewal proposal. NASA reserves the right 
to remove unexpended balances from grants when insufficient efforts 
have been made by the grantee to liquidate funding balances in a 
timely fashion.

[End of provision]


Sec. 1260.27  Equipment and other property.

Equipment and Other Property (Date)

    (a) On an exceptional basis, NASA permits acquisition of special 
purpose and general purpose equipment specifically required for use 
exclusively for research activities.
    (1) Acquisition of special purpose or general purpose equipment 
costing in excess of $5,000 (unless a lower threshold has been 
established by the recipient) and not included in the approved 
proposal budget, requires the prior approval of the NASA Grant 
Officer. Requests to the NASA Grant Officer for the acquisition of 
equipment shall be supported by written documentation setting forth 
the description, purpose, and acquisition value of the equipment, 
and including a written certification that the equipment will be 
used exclusively for research, activities. (A change in the model 
number of a prior approved piece of equipment does not require re-
submission for that item.)
    (2) NASA may elect to take title to items of special purpose or 
general purpose equipment after it is no longer necessary for 
performance of the grant. The recipient will be advised of the 
Government's intention to take title in writing if the item is 
approved for recipient purchase. Generally, the notification is made 
through inclusion of the special condition at 1260.66, Listing of 
Reportable Equipment and Other Property. If the Government does not 
exercise its right to take title to property acquired by the 
recipient with grant funds at the time the acquisition is approved, 
the property will be considered exempt according to 1260.133(b). 
When property is classified as exempt, the recipient shall hold 
title without further obligation to the Federal Government, 
including reporting of the equipment.
    (3) Special purpose or general purpose equipment acquired by the 
recipient with grant funds, valued under $5,000 (unless a lower 
threshold is established by the recipient) are classified as 
``supplies,'' do not require the prior approval of the NASA Grant 
Officer, shall vest in the recipient, and will be considered 
``exempt'' in accordance with 1260.133(b).
    (4) Grant funds may be expended for the acquisition of land or 
interests therein or for the acquisition and construction of 
facilities only under a facilities grant, as defined in 1260.12(g).
    (b) The recipient shall submit an annual Inventory Report, to be 
received no later than October 31 of each year, which lists all 
reportable (non-exempt equipment and/or Federally owned property) in 
its custody as of September 30. Negative responses for annual 
Inventory Reports (when there is no reportable equipment) are not 
required. A Final Inventory Report of Federally Owned Property, 
including equipment where title was taken by the Government, will be 
submitted by the recipient no later than 60 days after the 
expiration date of the grant. Negative responses for Final Inventory 
Reports are required.
    (1) All reports will include the information listed in paragraph 
(f)(1) of 1260.134, Equipment. No specific report form or format is 
required, provided that all necessary information set forth at 
1260.134(f)(1) is provided.
    (2) The original of each report shall be submitted to the Center 
Deputy Chief Financial Officer, Finance (DCFO(F)). Copies shall be 
furnished to the Center Industrial Property Officer and to ONR.

[End of provision]


Sec. 1260.28  Patent rights.

Patent Rights (Date)

    As stated at 1260.136, this award is subject to the provisions 
of 37 CFR 401.3(a) which requires use of the standard clause set out 
at 37 CFR 401.14 ``Patent Rights (Small Business Firms and Nonprofit 
Organizations)'' and the following:
    (a) Where the term ``contract'' or ``contractor'' is used in the 
``Patent Rights'' clause, the term shall be replaced by the term 
``grant'' or ``recipient,'' respectively.
    (b) In each instance where the term ``Federal Agency,'' 
``agency,'' or ``funding Federal agency'' is used in the ``Patent 
Rights'' clause, the term shall be replaced by the term ``NASA.''
    (c) The NASA regulation applicable to paragraph (e) of the 
``Patent Rights'' clause is at 37 CFR part 404, Licensing of 
Government-owned Inventions.
    (d) The following item is added to the end of paragraph (f) of 
the ``Patent Rights'' clause: ``(5) The recipient shall include a 
list of any Subject Inventions required to be disclosed during the 
preceding year in the performance report, technical report, or 
renewal proposal. A complete list (or a negative statement) for the 
entire award period shall be included in the summary of research.''
    (e) The term ``subcontract'' in paragraph (g) of the ``Patent 
Rights'' clause shall include purchase orders.
    (f) The NASA implementing regulation for paragraph (g)(2) of the 
``Patent Rights'' clause is at 48 CFR 1827.304-4(a)(i)(B).
    (g) The following requirement constitutes paragraph (l) of the 
``Patent Rights'' clause:
    ``(l) Communications. A copy of all submissions or requests 
required by this clause, plus a copy of any reports, manuscripts, 
publications or similar material bearing on patent matters, shall be 
sent to the Center Patent Counsel and the NASA Grant Officer in 
addition to any other submission requirements in the grant 
provisions. If any reports contain information describing a 
``subject invention'' for which the recipient has elected or may 
elect to retain title, NASA will use reasonable efforts to delay 
public release by NASA or publication by NASA in a NASA technical 
series until an application filing date has been established, 
provided that the recipient identify the information and the 
``subject invention'' to which it relates at the time of submittal. 
If required by the NASA Grant Officer, the recipient shall

[[Page 50344]]

provide the filing date, serial number and title, a copy of the 
patent application, and a patent number and issue date for any 
``subject invention'' in any country in which the recipient has 
applied for patents.''
    (h) NASA Inventions. NASA will use reasonable efforts to report 
inventions made by NASA employees as a consequence of, or which bear 
a direct relation to, the performance of specified NASA activities 
under this agreement and, upon timely request, will use reasonable 
efforts to grant the recipient an exclusive, or partially exclusive, 
revocable, royalty-bearing license, subject to the retention of a 
royalty-free right of the Government to practice or have practiced 
the invention by or on behalf of the Government.
    (i) In the event NASA contractors are tasked to perform work in 
support of specified activities under a cooperative agreement and 
inventions are made by contractor employees, the recipient will 
normally retain title to its employee inventions in accordance with 
35 U.S.C. 202, 14 CFR part 1245, and Executive Order 12591. In the 
event the recipient decides not to pursue rights to title in any 
such invention and NASA obtains title to such inventions, NASA will 
use reasonable efforts to report such inventions and, upon timely 
request, will use reasonable efforts to grant the recipient an 
exclusive, or partially exclusive, revocable, royalty-bearing 
license, subject to the retention of a royalty-free right of the 
Government to practice or have practiced the invention by or on 
behalf of the Government.

[End of provision]


Sec. 1260.29  Invention reporting and rights.

    (The grant officer may revise the language under paragraph (d) of 
this provision to modify each party's rights based on the particular 
circumstances of the program and/or the recipient's need to protect 
specific proprietary information. Any modification to the standard 
language set forth under the provision requires the concurrence of the 
Center's Patent Counsel and the provision be printed in full text.)

Invention Reporting and Rights (Date)

    (a) As used in this provision:
    (1) The term ``invention'' means any invention or discovery 
which is or may be patentable or otherwise protectable under Title 
35 of the United States Code, or any novel variety of plant which is 
or may be protected under the Plant Variety Protection Act (7 U.S.C. 
2321 et seq.).
    (2) The term ``made'' when used in relation to any invention 
means the conception or first actual reduction to practice of such 
invention.
    (b) The recipient shall report promptly to the grant officer 
each invention made in the performance of work under this grant. The 
report of such invention shall--
    (1) Identify the inventor(s) by full name; and
    (2) Include such full and complete technical information 
concerning the invention as is necessary to enable an understanding 
of the nature and operation thereof.
    (c) Reporting shall be made on NASA Form 1679 Disclosure of 
Invention and New Technology (Including Software).
    (d) The recipient hereby grants to the Government of the United 
States of America, as represented by the Administrator of the 
National Aeronautics and Space Administration, the full rights, 
title, and interest in and to each such invention throughout the 
world.


Sec. 1260.30  Rights in data.

    (The grant officer may revise the language under this provision to 
modify each party's rights based on the particular circumstances of the 
program and/or the recipients need to protect specific proprietary 
information. Any modification to the standard language set forth under 
the provision requires the concurrence of the Center's Patent Counsel 
and that the provision be printed in full text.)

Rights in Data (Date)

    (a) Fully Funded Efforts.
    (1) ``Data'' means recorded information, regardless of form, the 
media on which it may be recorded, or the method of recording. The 
term includes, but is not limited to, data of a scientific or 
technical nature, computer software and documentation thereof, and 
data comprising commercial and financial information.
    (2) The recipient grants to the Federal Government, a royalty-
free, nonexclusive and irrevocable license to use, reproduce, 
distribute (including distribution by transmission) to the public, 
perform publicly, prepare derivative works, and display publicly, 
data in whole or in part and in any manner for Federal purposes and 
to have or permit others to do so for Federal purposes only.
    (3) In order that the Federal Government may exercise its 
license rights in data, the Federal Government, upon request to the 
recipient, shall have the right to review and/or obtain delivery of 
data resulting from the performance of work under this grant, and 
authorize others to receive data to use for Federal purposes.
    (b) Cost Sharing and/or Matching Efforts. When the recipient 
cost shares with the Government on the effort, the following is 
added:
    ``(5) In the event data first produced by recipient in carrying 
out recipient's responsibilities under an agreement is furnished to 
NASA, and recipient considers such data to embody trade secrets or 
to comprise commercial or financial information which is privileged 
or confidential, and such data is so identified with a suitable 
notice or legend, the data will be maintained in confidence and 
disclosed and used by the Government and its contractors (under 
suitable protective conditions) only for experimental, evaluation, 
research and development purposes, by or on behalf of the Government 
for an agreed to period of time, and thereafter for Federal purposes 
as defined in Sec. 1260.30(a)(2).''
    (c) Add the following paragraph in Cooperative Agreements.
    ``(#) As to data first produced by NASA in carrying out NASA's 
responsibilities under a cooperative agreement and which data would 
embody trade secrets or would comprise commercial or financial 
information that is privileged or confidential if it has been 
obtained from the recipient, such data will be marked with an 
appropriate legend and maintained in confidence for 5 years (unless 
a shorter period has been agreed to between the Government and 
recipient) after development of the information, with the express 
understanding that during the aforesaid period such data may be 
disclosed and used (under suitable protective conditions) by or on 
behalf of the Government for Government purposes only, and 
thereafter for any purpose whatsoever without restriction on 
disclosure and use. Recipient agrees not to disclose such data to 
any third party without NASA's written approval until the 
aforementioned restricted period expires.''

[End of provision]


Sec. 1260.31  National security.

National Security (Date)

    Normally, NASA grants do not involve classified information. 
However, if it is known in advance that a grant involves classified 
information or if the work on the grant is likely to develop 
classified information, individuals performing on the grant who will 
have access to the information must obtain the appropriate security 
clearance in advance of performing on the grant, in accordance with 
NASA Policy Guidance (NPG) 1620.1 Security Procedures and 
Guidelines. When access to classified information is not originally 
anticipated in the performance of a grant, but such information is 
subsequently sought or potentially developed by the grant recipient, 
the NASA Grant Officer who issued the grant shall be notified 
immediately, and prior to work under the grant proceeding, to 
implement the appropriate clearance requirements.

[End of provision]


Sec. 1260.32  Nondiscrimination.

Nondiscrimination (Date)

    (a) To the extent provided by law and any applicable agency 
regulations, this award and any program assisted thereby are subject 
to the provisions of Title VI of the Civil Rights Act of 1964 
(Public Law 88-352), Title IX of the Education amendments of 1972 
(Public Law 92-318, 20 U.S.C. 1681 et seq.), Section 504 of the 
Rehabilitation Act of 1973 (29 U.S.C. 794), the Age Discrimination 
Act of 1975 (Public Law 94-135), the implementing regulations issued 
pursuant thereto by NASA, and the assurance of compliance which the 
recipient has filed with NASA.
    (b) The recipient shall obtain from each organization that 
applies or serves as a subrecipient, contractor or subcontractor 
under this award (for other than the provision of commercially 
available supplies, materials, equipment, or general support 
services) an assurance of compliance as required by NASA 
regulations.
    (c) Work on NASA grants is subject to the provisions of Title VI 
of the Civil Rights Act

[[Page 50345]]

of 1964 (Public Law 88-352; 42 U.S.C. 2000d-l), Title IX of the 
Education Amendments of 1972 (20 U.S.C. 1680 et seq.), Section 504 
of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794), the 
Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.), and the 
NASA implementing regulations (14 CFR parts 1250, 1251, 1252, and 
1253).

[End of provision]


Sec. 1260.33  Subcontracts.

Subcontracts (Date)

    (a) Recipients shall notify NASA when a subcontract award will 
be made that falls within the thresholds established at 
Sec. 1260.144(e). When pre-award review of a subcontract is 
requested by the NASA Grant Officer in accordance with 
Sec. 1260.144(e), the following specific documents will be made 
available to the NASA Grant Officer. (The Grant Officer can request 
additional documents):
    (1) A copy of the proposed subcontract.
    (2) The basis for subcontractor selection.
    (3) Justification for lack of competition when competitive bids 
or offers are not obtained.
    (4) The subcontract budget and basis for subcontract cost or 
price.
    (b) The recipient (with the exception of foreign organizations) 
shall utilize small business concerns, small disadvantaged business 
concerns, Historically Black Colleges and Universities, minority 
educational institutions, and women-owned small business concerns as 
subcontractors to the maximum extent practicable.

[End of provision]


Sec. 1260.34  Clean air and water.

Clean Air and Water (Date)

    (Applicable only if the award exceeds $100,000, or a facility to 
be used has been the subject of a conviction under the Clean Air Act 
(42 U.S.C. 1857c-8(c)(1) or the Federal Water Pollution Control Act 
(33 U.S.C. 1319(c)), and is listed by EPA, or if the award is not 
otherwise exempt). The recipient agrees to the following:
    (a) Comply with applicable standards, orders or regulations 
issued pursuant to the Clean Air Act, as amended (42 U.S.C. 7401 et 
seq.) and of the Federal Water Pollution Control Act (33 U.S.C. 1251 
et seq.).
    (b) Ensure that no portion of the work under this award will be 
performed in a facility listed on the Environmental Protection 
Agency (EPA) List of Violating Facilities on the date that this 
award was effective unless and until the EPA eliminates the name of 
such facility or facilities from such listings.
    (c) Use its best efforts to comply with clean air standards and 
clean water standards at the facility in which the award is being 
performed.
    (d) Insert the substance of the provisions of this clause into 
any nonexempt subaward or contract under the award.
    (e) Report violations to NASA or to EPA.

[End of provision]


Sec. 1260.35  Investigative requirements.

Investigative Requirements (Date)

    (a) As requested by NASA, the recipient of each grant, and any 
other individuals to perform on the grant, agree to provide 
sufficient personal/biographical information necessary to conduct an 
investigation of the individual's background. The purpose of the 
investigation is to allow access to a NASA Center, or to NASA 
information, for performance of this grant. The recipient 
acknowledges that NASA reserves the right to perform security 
checks, and to deny or restrict access to a NASA Center, facility, 
computer system, or technical information as appropriate.
    (b) All visit requests must be submitted in a timely manner in 
accordance with instructions provided by the Center(s) to be 
visited.

[End of provision]


Sec. 1260.36  Travel and transportation.

Travel and Transportation (Date)

    (a) The Fly American Act, 49 U.S.C. 1517, requires the recipient 
to use U.S. flag air carriers for international air transportation 
of personnel and property to the extent that service by those 
carriers is available.
    (b) Department of Transportation regulations, 49 CFR part 173, 
govern recipient shipment of hazardous materials and other items.

[End of provision]


Sec. 1260.37  Safety.

Safety (Date)

    (a) The recipient shall act responsibly in matters of safety and 
shall take all reasonable safety measures in performing under this 
grant or cooperative agreement. The recipient shall comply with all 
applicable federal, state, and local laws relating to safety. The 
recipient shall maintain a record of, and will notify the NASA Grant 
Officer of any accident involving death, disabling injury or 
substantial loss of property. The recipient will advise NASA of 
hazards that come to its attention as a result of the work performed 
through routine status reports furnished in compliance with this 
grant or cooperative agreement.
    (b) Where the work under this grant or cooperative agreement 
involves flight hardware, the hazardous aspects, if any, of such 
hardware will be identified, in writing, by the recipient. 
Compliance with this provision by subcontractors shall be the 
responsibility of the recipient.

[End of provision]


Sec. 1260.38  Drug-free workplace.

Drug-Free Workplace (Date)

    (a) Definitions. As used in this provision--
    Controlled substance means a controlled substance in schedules I 
through V of section 202 of the Controlled Substances Act (21 U.S.C. 
812) and as further defined in regulation at 21 CFR 1308.11 through 
1308.15.
    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the 
Federal or State criminal drug statutes.
    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, 
possession, or use of any controlled substance.
    Drug-free workplace means the site(s) for the performance of 
work done by the Recipient in connection with a specific grant or 
cooperative agreement at which employees of the Recipient are 
prohibited from engaging in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance.
    Employee means an employee of a Recipient directly engaged in 
the performance of work under a Government grant or cooperative 
agreement. ``Directly engaged'' is defined to include all direct 
cost employees and any other Recipient employee who has other than a 
minimal impact or involvement in performance of the grant or 
cooperative agreement.
    Individual means a proposer/recipient that has no more than one 
employee including the proposer/recipient.
    (b) The Recipient, if other than an individual, shall--within 30 
days after award (unless a longer period is agreed to in writing), 
or as soon as possible for grants and cooperative agreements of less 
than 30 days performance duration--
    (1) Publish a statement notifying its employees that the 
unlawful manufacture, distribution, dispensing, possession, or use 
of a controlled substance is prohibited in the Recipient's workplace 
and specifying the actions that will be taken against employees for 
violations of such prohibition;
    (2) Establish an ongoing drug-free awareness program to inform 
such employees about--
    (i) The dangers of drug abuse in the workplace;
    (ii) The Recipient's policy of maintaining a drug-free 
workplace;
    (iii) Any available drug counseling, rehabilitation, and 
employee assistance programs; and
    (iv) The penalties that may be imposed upon employees for drug 
abuse violations occurring in the workplace;
    (3) Provide all employees engaged in performance of the grant or 
cooperative agreement with a copy of the statement required by 
paragraph (b)(1) of this provision;
    (4) Notify such employees in writing in the statement required 
by paragraph (b)(1) of this provision that, as a condition of 
continued employment on the grant or cooperative agreement, the 
employee will--
    (i) Abide by the terms of the statement; and
    (ii) Notify the employer in writing of the employee's conviction 
under a criminal drug statute for a violation occurring in the 
workplace no later than 5 days after such conviction;
    (5) Notify the Grant Officer in writing within 10 days after 
receiving notice under paragraph (b)(4)(ii) of this provision, from 
an employee or otherwise receiving actual notice of such conviction. 
The notice shall include the position title of the employee;
    (6) Within 30 days after receiving notice under paragraph 
(b)(4)(ii) of this provision of

[[Page 50346]]

a conviction, take one of the following actions with respect to any 
employee who is convicted of a drug abuse violation occurring in the 
workplace:
    (i) Taking appropriate personnel action against such employee, 
up to and including termination; or
    (ii) Require such employee to satisfactorily participate in a 
drug abuse assistance or rehabilitation program approved for such 
purposes by a Federal, State, or local health, law enforcement, or 
other appropriate agency; and
    (7) Make a good faith effort to maintain a drug-free workplace 
through implementation of paragraphs (b)(1) though (b)(6) of this 
provision.
    (c) The Recipient, if an individual, agrees by acceptance of the 
grant or cooperative agreement, not to engage in the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance during performance.
    (d) In addition to other remedies available to the Government, 
the Recipient's failure to comply with the requirements of paragraph 
(b) or (c) of this provision may render the Recipient subject to 
suspension of payments, termination of the grant or cooperative 
agreement, and suspension or debarment.

[End of provision]

Special Conditions


Sec. 1260.50  Special conditions.

    (a) In addition to the provisions set forth in Secs. 1260.21 
through 1260.38, NASA grants and cooperative agreements are subject to 
special conditions, which either are not applicable to all awards or 
are temporary in nature. Examples are found in Secs. 1260.51 through 
1260.69, but NASA may impose other conditions as discussed in 
Sec. 1260.114 or as the requirements dictate. Deviations are not 
required for changes made to special conditions.
    (b) Special conditions will be printed in full text.
    (c) In facilities grants, special conditions will be selected on a 
case-by-case basis. As appropriate, the requirements of the following 
sections will apply: Sec. 1260.123(c), Cost Sharing or Matching; 
Sec. 1260.125(h), Revision of Budget and Program Plans; and 
Sec. 1260.132, Real Property.
    (d) Research grants with foreign organizations will include special 
conditions at Secs. 1260.59 through 1260.61, modified as necessary, 
when not covered under a Memorandum of Agreement (MOA). In addition, 
other special conditions (e.g., Secs. 1260.62 through 1260.65) will be 
written with the aid of legal counsel, and added when necessary.


Sec. 1260.51  Cooperative agreement special condition.

Cooperative Agreement Special Condition (Date)

    (a) This award is a cooperative agreement as it is anticipated 
there will be substantial NASA involvement during performance of the 
effort. NASA and the recipient mutually agree to the following 
statement of anticipated cooperative interactions which may occur 
during the performance of this effort:
    (Reference the approved proposal that contains a detailed 
description of the work and insert a concise statement of the exact 
nature of the cooperative interactions that deals with existing 
facts and not contingencies.)
    (b) The terms ``grant'' and ``recipient'' mean ``cooperative 
agreement'' and ``recipient of cooperative agreement,'' 
respectively, wherever the terms appear in provisions and special 
conditions included in this agreement.
    (c) NASA's ability to participate and perform its collaborative 
effort under this cooperative agreement is subject to the 
availability of appropriated funds and nothing in this cooperative 
agreement commits the United States Congress to appropriate funds 
therefor.


Sec. 1260.52  Multiple year grant or cooperative agreement.

Multiple Year Grant or Cooperative Agreement (Date)

    This is a multiple year grant or cooperative agreement. 
Contingent on the availability of funds, scientific progress of the 
project, and continued relevance to NASA programs, NASA anticipates 
continuing support at approximately the following levels:
    Second year $________, Anticipated funding date ________.
    Third year $________, Anticipated funding date ________. 
(Periods may be added or omitted, as applicable)


Sec. 1260.53  Incremental funding.

Incremental Funding (Date)

    (a) Only $________ of the amount indicated on the face of this 
award is available for payment and allotted to this award. NASA 
contemplates making additional allotments of funds during 
performance of this effort. It is anticipated that these funds will 
be obligated as appropriated funds become available without any 
action required by the recipient. The recipient will be given 
written notification by the NASA Grant Officer.
    (b) The recipient agrees to perform work up to the point at 
which the total amount paid or payable by the Government 
approximates but does not exceed the total amount actually allotted 
to this grant or cooperative agreement. NASA is not obligated to 
reimburse the recipient for the expenditure of amounts in excess of 
the total funds allotted by NASA to this grant or cooperative 
agreement. The recipient is not authorized to continue performance 
beyond the amount allotted to this award.


Sec. 1260.54  Cost sharing.

Cost Sharing (Date)

    (a) NASA and the recipient will share in providing the resources 
necessary to perform the agreement. NASA funding and non-cash 
contributions (personnel, equipment, facilities, etc.) and the 
dollar value of the recipient's cash and/or non-cash contribution 
will be on a ____ percent NASA; ____ percent recipient basis.
    (b) The funding and non-cash contributions by both parties is 
represented by the following dollar amounts:

Government Share-------------------------------------------------------
Recipient Share--------------------------------------------------------
Total Amount-----------------------------------------------------------
    (c) Criteria and procedures for the allowability and 
allocability of cash and non-cash contributions shall be governed by 
Sec. 1260.123, Cost Sharing or Matching. The applicable Federal cost 
principles are cited in Sec. 1260.127.
    (d) The recipient's share shall not be charged to the Government 
under this agreement or under any other contract, grant, or 
cooperative agreement.


Sec. 1260.55  Reports substitution.

Reports Substitution (Date)

    Technical Reports may be substituted for the required 
Performance Reports. The title page of such reports shall clearly 
indicate that the substitution has been made and will show the 
period covered by the originally required Performance Report.


Sec. 1260.56  Withholding.

Withholding (Date)

    If a recipient fails to comply with the terms and conditions of 
this grant or cooperative agreement, including reporting 
requirements, NASA may withhold advance payments under this award, 
and may also withhold future awards to the recipient, pending 
correction of the deficiency by the recipient. If advance payments 
are withheld, the Grant Officer will notify the NASA Financial 
Management Office when payments may resume.


Sec. 1260.57  New technology.

New Technology (Date)

    (a) Definitions.
    Administrator, as used in this special condition, means the 
Administrator of the National Aeronautics and Space Administration 
(NASA) or duly authorized representative.
    Grant, as used in this special condition, means any actual or 
proposed grant, cooperative agreement, understanding, or other 
arrangement, and includes any assignment, substitution of parties, 
or subcontract executed or entered into thereunder.
    Made, as used in this special condition, means conception or 
first actual reduction to practice; provided, that in the case of a 
variety of plant, the date of determination (as defined in section 
41(d) of the Plant Variety Protection Act, 7 U.S.C. 2401(d)) must 
also occur during the period of grant performance.

[[Page 50347]]

    Nonprofit organization, as used in this special condition, means 
a domestic university or other institution of higher education or an 
organization of the type described in section 501(c)(3) of the 
Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and exempt from 
taxation under section 501(a) of the Internal Revenue Code (26 
U.S.C. 501(a)), or any domestic nonprofit scientific or educational 
organization qualified under a State nonprofit organization statute.
    Practical application, as used in this special condition, means 
to manufacture, in the case of a composition or product; to 
practice, in the case of a process or method; or to operate, in case 
of a machine or system; and, in each case, under such conditions as 
to establish that the invention is being utilized and that its 
benefits are, to the extent permitted by law or Government 
regulations, available to the public on reasonable terms.
    Reportable item, as used in this special condition, means any 
invention, discovery, improvement, or innovation of the grantee, 
whether or not patentable or otherwise protectable under Title 35 of 
the United States Code, made in the performance of any work under 
any NASA grant or in the performance of any work that is 
reimbursable under any provision in any NASA grant providing for 
reimbursement of costs incurred before the effective date of the 
grant. Reportable items include, but are not limited to, new 
processes, machines, manufactures, and compositions of matter, and 
improvements to, or new applications of, existing processes, 
machines, manufactures, and compositions of matter. Reportable items 
also include new computer programs, and improvements to, or new 
applications of, existing computer programs, whether or not 
copyrightable or otherwise protectable under Title 17 of the United 
States Code.
    Small business firm, as used in this special condition, means a 
domestic small business concern as defined at 15 U.S.C. 632 and 
implementing regulations (see 13 CFR 121.401 through 121.413) of the 
Administrator of the Small Business Administration.
    Subject invention, as used in this special condition, means any 
reportable item which is or may be patentable or otherwise 
protectible under Title 35 of the United States Code, or any novel 
variety of plant that is or may be protectable under the Plant 
Variety Protection Act (7 U.S.C. 2321 et seq.).
    (b) Allocation of principal rights.
    (1) Presumption of title.
    (i) Any reportable item that the Administrator considers to be a 
subject invention shall be presumed to have been made in the manner 
specified in paragraph (1) or (2) of section 305(a) of the National 
Aeronautics and Space Act of 1958 (42 U.S.C. 2457(a)) (hereinafter 
called ``the Act''), and that presumption shall be conclusive unless 
at the time of reporting the reportable item the Recipient submits 
to the Grant Officer a written statement, containing supporting 
details, demonstrating that the reportable item was not made in the 
manner specified in paragraph (1) or (2) of section 305(a) of the 
Act.
    (ii) Regardless of whether title to a given subject invention 
would otherwise be subject to an advance waiver or is the subject of 
a petition for waiver, the Recipient may nevertheless file the 
statement described in paragraph (b)(1)(i) of this special 
condition. The Administrator will review the information furnished 
by the Recipient in any such statement and any other available 
information relating to the circumstances surrounding the making of 
the subject invention and will notify the Recipient whether the 
Administrator has determined that the subject invention was made in 
the manner specified in paragraph (1) or (2) of section 305(a) of 
the Act.
    (2) Property rights in subject inventions. Each subject 
invention for which the presumption of paragraph (b)(1)(i) of this 
special condition is conclusive or for which there has been a 
determination that it was made in the manner specified in paragraph 
(1) or (2) of section 305(a) of the Act shall be the exclusive 
property of the United States as represented by NASA unless the 
Administrator waives all or any part of the rights of the United 
States, as provided in paragraph (b)(3) of this special condition.
    (3) Waiver of rights.
    (i) Section 305(f) of the Act provides for the promulgation of 
regulations by which the Administrator may waive the rights of the 
United States with respect to any invention or class of inventions 
made or that may be made under conditions specified in paragraph (1) 
or (2) of section 305(a) of the Act. The promulgated NASA Patent 
Waiver Regulations, 14 CFR part 1245, subpart 1, have adopted the 
Presidential Memorandum on Government Patent Policy of February 18, 
1983, as a guide in acting on petitions (requests) for such waiver 
of rights.
    (ii) As provided in 14 CFR part 1245, subpart 1, Recipients may 
petition, either prior to execution of the grant or within 30 days 
after execution of the grant, for advance waiver of rights to any or 
all of the inventions that may be made under a grant. If such a 
petition is not submitted, or if after submission it is denied, the 
Recipient (or an employee inventor of the Recipient) may petition 
for waiver of rights to an identified subject invention within eight 
months of first disclosure of the invention in accordance with 
paragraph (e)(2) of this special condition, or within such longer 
period as may be authorized in accordance with 14 CFR 1245.105.
    (c) Minimum rights reserved by the Government.
    (1) With respect to each subject invention for which a waiver of 
rights is applicable in accordance with 14 CFR part 1245, subpart 1, 
the Government reserves--
    (i) An irrevocable, nonexclusive, nontransferable, royalty-free 
license for the practice of such invention throughout the world by 
or on behalf of the United States or any foreign government in 
accordance with any treaty or agreement with the United States; and
    (ii) Such other rights as stated in 14 CFR 1245.107.
    (2) Nothing contained in this paragraph (c) shall be considered 
to grant to the Government any rights with respect to any invention 
other than a subject invention.
    (d) Minimum rights to the Recipient.
    (1) The Recipient is hereby granted a revocable, nonexclusive, 
royalty-free license in each patent application filed in any country 
on a subject invention and any resulting patent in which the 
Government acquires title, unless the Recipient fails to disclose 
the subject invention within the times specified in paragraph (e)(2) 
of this special condition. The Recipient's license extends to its 
domestic subsidiaries and affiliates, if any, within the corporate 
structure of which the Recipient is a party and includes the right 
to grant sublicenses of the same scope to the extent the Recipient 
was legally obligated to do so at the time the grant was awarded. 
The license is transferable only with the approval of the 
Administrator except when transferred to the successor of that part 
of the Recipient's business to which the invention pertains.
    (2) The Recipient's domestic license may be revoked or modified 
by the Administrator to the extent necessary to achieve expeditious 
practical application of the subject invention pursuant to an 
application for an exclusive license submitted in accordance with 37 
CFR part 404, Licensing of Government Owned Inventions. This license 
will not be revoked in that field of use or the geographical areas 
in which the Recipient has achieved practical application and 
continues to make the benefits of the invention reasonably 
accessible to the public. The license in any foreign country may be 
revoked or modified at the discretion of the Administrator to the 
extent the Recipient, its licensees, or its domestic subsidiaries or 
affiliates have failed to achieve practical application in that 
foreign country.
    (3) Before revocation or modification of the license, the 
Recipient will be provided a written notice of the Administrator's 
intention to revoke or modify the license, and the Recipient will be 
allowed 30 days (or such other time as may be authorized by the 
Administrator for good cause shown by the Recipient) after the 
notice to show cause why the license should not be revoked or 
modified. The Recipient has the right to appeal to the Administrator 
any decision concerning the revocation or modification of its 
license.
    (e) Invention identification, disclosures, and reports.
    (1) The Recipient shall establish and maintain active and 
effective procedures to assure that reportable items are promptly 
identified and disclosed to Recipient personnel responsible for the 
administration of this New Technology special condition within six 
months of conception and/or first actual reduction to practice, 
whichever occurs first in the performance of work under this grant. 
These procedures shall include the maintenance of laboratory 
notebooks or equivalent records and other records as are reasonably 
necessary to document the conception and/or the first actual 
reduction to practice of the reportable items, and records that show 
that the procedures for identifying and disclosing reportable items 
are followed. Upon request, the Recipient shall furnish the Grant 
Officer a description of such procedures for evaluation and for 
determination as to their effectiveness.
    (2) The Recipient will disclose each reportable item to the 
Grant Officer within

[[Page 50348]]

two months after the inventor discloses it in writing to Recipient 
personnel responsible for the administration of this New Technology 
special condition or, if earlier, within six months after the 
Recipient becomes aware that a reportable item has been made, but in 
any event for subject inventions before any on sale, public use, or 
publication of such invention known to the Recipient. The disclosure 
to the agency shall be in the form of a written report and shall 
identify the grant under which the reportable item was made and the 
inventor(s) or innovator(s). It shall be sufficiently complete in 
technical detail to convey a clear understanding, to the extent 
known at the time of the disclosure, of the nature, purpose, 
operation, and physical, chemical, biological, or electrical 
characteristics of the reportable item. The disclosure shall also 
identify any publication, on sale, or public use of any subject 
invention and whether a manuscript describing such invention has 
been submitted for publication and, if so, whether it has been 
accepted for publication at the time of disclosure. In addition, 
after disclosure to the agency, the Recipient will promptly notify 
the agency of the acceptance of any manuscript describing a subject 
invention for publication or of any on sale or public use planned by 
the Recipient for such invention.
    (3) The Recipient shall furnish the Grant Officer the following:
    (i) Interim reports every 12 months (or such longer period as 
may be specified by the Grant Officer) from the date of the grant, 
listing reportable items during that period, and certifying that all 
reportable items have been disclosed (or that there are no such 
inventions) and that the procedures required by paragraph (e)(1) of 
this special condition have been followed.
    (ii) A final report, within 3 months after completion of the 
grant work, listing all reportable items or certifying that there 
were no such reportable items, and listing all subcontracts at any 
tier containing a patent rights clause or certifying that there were 
no such subcontracts.
    (4) The Recipient agrees, upon written request of the Grant 
Officer, to furnish additional technical and other information 
available to the Recipient as is necessary for the preparation of a 
patent application on a subject invention and for the prosecution of 
the patent application, and to execute all papers necessary to file 
patent applications on subject inventions and to establish the 
Government's rights in the subject inventions.
    (5) The Recipient agrees, subject to FAR 27.302(j), that the 
Government may duplicate and disclose subject invention disclosures 
and all other reports and papers furnished or required to be 
furnished pursuant to this special condition.
    (f) Examination of records relating to inventions.
    (1) The Grant Officer or any authorized representative shall, 
until 3 years after final payment under this grant, have the right 
to examine any books (including laboratory notebooks), records, and 
documents of the Recipient relating to the conception or first 
actual reduction to practice of inventions in the same field of 
technology as the work under this grant to determine whether--
    (i) Any such inventions are subject inventions;
    (ii) The Recipient has established and maintained the procedures 
required by paragraph (e)(1) of this special condition; and
    (iii) The Recipient and its inventors have complied with the 
procedures.
    (2) If the Grant Officer learns of an unreported Recipient 
grantee invention that the Grant Officer believes may be a subject 
invention, the Recipient may be required to disclose the invention 
to the agency for a determination of ownership rights.
    (3) Any examination of records under this paragraph will be 
subject to appropriate conditions to protect the confidentiality of 
the information involved.
    (g) Withholding of payment (this paragraph does not apply to 
subcontracts).
    (1) Any time before final payment under this grant, the Grant 
Officer may, in the Government's interest, withhold payment until a 
reserve not exceeding $50,000 or 5 percent of the amount of this 
grant, whichever is less, shall have been set aside if, in the Grant 
Officer's opinion, the Recipient fails to--
    (i) Establish, maintain, and follow effective procedures for 
identifying and disclosing reportable items pursuant to paragraph 
(e)(1) of this special condition;
    (ii) Disclose any reportable items pursuant to paragraph (e)(2) 
of this special condition;
    (iii) Deliver acceptable interim reports pursuant to paragraph 
(e)(3)(i) of this special condition; or
    (iv) Provide the information regarding subcontracts pursuant to 
paragraph (h)(4) of this special condition.
    (2) Such reserve or balance shall be withheld until the Grant 
Officer has determined that the Recipient has rectified whatever 
deficiencies exist and has delivered all reports, disclosures, and 
other information required by the grant.
    (3) Final payment under the grant shall not be made before the 
Recipient delivers to the Grant Officer all disclosures of 
reportable items required by paragraph (e)(2) of this special 
condition, and an acceptable final report pursuant to paragraph 
(e)(3)(ii) of this special condition.
    (4) The Grant Officer may decrease or increase the sums withheld 
up to the maximum authorized in paragraph (g)(1) of this special 
condition. No amount shall be withheld under this paragraph while 
the amount specified by this paragraph is being withheld under other 
provisions of the grant. The withholding of any amount or the 
subsequent payment thereof shall not be construed as a waiver of any 
Government rights.
    (h) Subcontracts.
    (1) Unless otherwise authorized or directed by the Grant 
Officer, the Recipient shall--
    (i) Include the clause at NASA FAR Supplement (NFS) 1852.227-70, 
New Technology, (suitably modified to identify the parties) in any 
subcontract hereunder (regardless of tier) with other than a small 
business firm or nonprofit organization for the performance of 
experimental, developmental, or research work; and
    (ii) Include the clause at FAR 52.227-11 (suitably modified to 
identify the parties) in any subcontract hereunder (regardless of 
tier) with a small business firm or nonprofit organization for the 
performance of experimental, developmental, or research work.
    (2) In the event of a refusal by a prospective subcontractor to 
accept such a clause the Recipient--
    (i) Shall promptly submit a written notice to the Grant Officer 
setting forth the subcontractor's reasons for such refusal and other 
pertinent information that may expedite disposition of the matter; 
and
    (ii) Shall not proceed with such subcontract without the written 
authorization of the Grant Officer.
    (3) In the case of subcontracts at any tier, the agency, 
subcontractor, and Recipient agree that the mutual obligations of 
the parties created by this special condition constitute a contract 
between the subcontractor and NASA with respect to those matters 
covered by this grant.
    (4) The Recipient shall promptly notify the Grant Officer in 
writing upon the award of any subcontract at any tier containing a 
patent rights clause by identifying the subcontractor, the 
applicable patent rights clause, the work to be performed under the 
subcontract, and the dates of award and estimated completion. Upon 
request of the Grant Officer, the Recipient shall furnish a copy of 
such subcontract, and, no more frequently than annually, a listing 
of the subcontracts that have been awarded.
    (5) The subcontractor will retain all rights provided for the 
Recipient in paragraph (h)(1)(i) or (ii) of this special condition, 
whichever is included in the subcontract, and the Recipient will 
not, as part of the consideration for awarding the subcontract, 
obtain rights in the subcontractor's subject inventions.
    (i) Preference for United States industry. Unless provided 
otherwise, no Recipient that receives title to any subject invention 
and no assignee of any such Recipient shall grant to any person the 
exclusive right to use or sell any subject invention in the United 
States unless such person agrees that any products embodying the 
subject invention will be manufactured substantially in the United 
States. However, in individual cases, the requirement may be waived 
by the Administrator upon a showing by the Recipient or assignee 
that reasonable but unsuccessful efforts have been made to grant 
licenses on similar terms to potential licensees that would be 
likely to manufacture substantially in the United States or that 
under the circumstances domestic manufacture is not commercially 
feasible.


Sec. 1260.58  Designation of new technology representative and patent 
representative.

Designation of New Technology Representative and Patent Representative 
(Date)

    (a) For purposes of administration of the special condition of 
this grant entitled ``New Technology,'' the following named 
representatives are hereby designated by the Grant Officer to 
administer such special condition:

[[Page 50349]]



------------------------------------------------------------------------
                                                     Address (including
               Title                  Office code         zip code)
------------------------------------------------------------------------
New Technology Representative
Patent Representative
------------------------------------------------------------------------

    (b) Reports of reportable items, and disclosure of subject 
inventions, interim reports, final reports, utilization reports, and 
other reports required by the special condition, as well as any 
correspondence with respect to such matters, should be directed to 
the New Technology Representative unless transmitted in response to 
correspondence or request from the Patent Representative. Inquires 
or requests regarding disposition of rights, election of rights, or 
related matters should be directed to the Patent Representative. 
This special condition shall be included in any subcontract 
hereunder requiring a ``New Technology'' provision or ``Patent 
Rights--Retention by the Contractor (Short Form)'' clause, unless 
otherwise authorized or directed by the Grant Officer. The 
respective responsibilities and authorities of the above-named 
representatives are set forth in 1827.305-370 of the NASA FAR 
Supplement.


Sec. 1260.59  Choice of law.

Choice of Law (Date)

    The rights and obligations of the parties to the grant (or 
cooperative agreement) shall be ascertainable by recourse to the 
laws of the United States of America. However, it is understood that 
the laws of the recipient's country will generally apply to 
recipient activities within that country.


Sec. 1260.60  Public information.

Public Information (Date)

    Information regarding this grant (including a copy of this award 
document) may be released by the recipient without restriction. 
However, technical information relating to work performed under this 
grant where there was a NASA contribution should be released by the 
recipient only after consultation with the NASA Technical Officer.


Sec. 1260.61  Allocation of risk/liability.

Allocation of Risk/Liability (Date)

    (a) With respect to activities undertaken under this agreement, 
the recipient agrees not to make any claim against NASA or the U.S. 
Government with respect to the injury or death of its employees or 
its contractors and subcontractor employees, or to the loss of its 
property or that of its contractors and subcontractors, whether such 
injury, death, damage or loss arises through negligence or 
otherwise, except in the case of willful misconduct.
    (b) In addition, the recipient agrees to indemnify and hold the 
U.S. Government and its contractors and subcontractors harmless from 
any third party claim, judgment, or cost arising from the injury to 
or death of any person, or for damage to or loss of any property, 
arising as a result of its possession or use of any U.S. Government 
property.


Sec. 1260.62  Payment--to foreign organizations.

Payment--To Foreign Organizations

    (For grants or cooperative agreements with foreign 
organizations, this clause will be developed on a case-by-case 
basis.)


Sec. 1260.63  Customs clearance and visas.

Customs Clearance and Visas

    (For grants or cooperative agreements with foreign 
organizations, this clause will be developed on a case-by-case 
basis.)


Sec. 1260.64  Taxes.

Taxes

    (For grants or cooperative agreements with foreign 
organizations, this clause will be developed on a case-by-case 
basis.)


Sec. 1260.65  Exchange of technical data and goods.

Exchange of Technical Data and Goods

    (For grants or cooperative agreements with foreign 
organizations, this clause will be developed on a case-by-case 
basis.)


Sec. 1260.66  Listing of reportable equipment and other property.

Listing of Reportable Equipment and Other Property (Date)

    (a) Title to federally-owned property provided to the recipient 
remains vested in the Federal Government, and shall be managed in 
accordance with 1260.133. The following items of federally-owned 
property are being provided to the recipient for use in performance 
of the work under this grant or cooperative agreement:

{List property or state ``not applicable.''}

    (b) The following specific items of equipment acquired by the 
recipient have been identified by NASA for transfer of title to the 
Government when no longer required for performance under this grant 
or cooperative agreement. This equipment will be managed in 
accordance with Sec. 1260.134, and shall be transferred to NASA or 
NASA's designee in accordance with the procedures set forth at 
Sec. 1260.134(g):

{List property or state ``not applicable.''}


Sec. 1260.67  Equipment and other property under grants with commercial 
firms.

Equipment and Other Property Under Grants With Commercial Firms (Date)

    (a) This grant permits acquisition of special purpose equipment 
required for the conduct of research. Acquisition of special purpose 
equipment costing in excess of $5,000 and not included in the 
approved proposal budget requires the prior approval of the Grant 
Officer unless the item is merely a different model of an item shown 
in the approved proposal budget.
    (b) Recipients may not purchase, as a direct cost to the grant, 
items of general purpose equipment, examples of which include but 
are not limited to office equipment and furnishings, air 
conditioning equipment, reproduction and printing equipment, motor 
vehicles, and automatic data processing equipment. If the Recipient 
requests an exception, the Recipient shall submit a written request 
for Grant Officer approval, prior to purchase by the Recipient, 
stating why the Recipient cannot charge the general purpose 
equipment to indirect costs.
    (c) Under no circumstances shall grant funds be used to acquire 
land or any interest therein, to acquire or construct facilities (as 
defined in 48 CFR (FAR) 45.301), or to procure passenger carrying 
vehicles.
    (d) The Government shall have title to equipment and other 
personal property acquired with Government funds. Such property 
shall be disposed of pursuant to 48 CFR (FAR) 45.603.
    (e) Title to Government furnished equipment (including 
equipment, title to which has been transferred to the Government 
prior to completion of the work) will remain with the Government.
    (f) The Recipient shall establish and maintain property 
management standards for Government property and otherwise manage 
such property as set forth in 48 CFR (FAR) 45.5 and 48 CFR (NFS) 
1845.5.
    (g) Recipients shall submit annually a NASA Form 1018, NASA 
Property in the Custody of Contractors, in accordance with the 
instructions on the form, the provisions of 48 CFR (NFS) 1845.71 and 
any supplemental instructions that may be issued by NASA for the 
current reporting period. The original NF 1018 shall be submitted to 
the center Deputy Chief Financial Officer, Finance, with three 
copies sent concurrently to the center Industrial Property Officer. 
The annual reporting period shall be from October 1 of each year 
through September 30 of the following year. The report shall be 
submitted in time to be received by October 31. Negative reports 
(i.e. no reportable property) are required. The information 
contained in the reports is entered into the NASA accounting system 
to reflect current asset values for agency financial statement 
purposes. Therefore, it is essential that required reports be 
received no later than October 31. A final report is required within 
30 days after expiration of the agreement.
    (h) The requirements set forth in this special condition 
supercedes grant provision Sec. 1260.27, Equipment and Other 
Property.


Sec. 1260.68  Invoices and payments under grants with commercial firms.

Invoices and Payments Under Grants With Commercial Firms (Date)

    (a) Invoices for payment of actual incurred costs shall be 
submitted by the recipient no more frequently than on a quarterly 
basis.
    (b) Invoices shall be submitted by the recipient to the 
following offices:
    (1) The original invoice shall be sent directly to the payment 
office designated on the grant cover page.
    (2) Copies of the invoice shall be sent to the NASA Technical 
Officer and NASA Grant Officer.
    (c) All invoices shall reference the grant number.
    (d) The final invoice shall be marked ``Final'' and shall be 
submitted within 90 days of the expiration of the grant.

[[Page 50350]]

    (e) The requirements set forth in this special condition 
supercedes grant provision Sec. 1260.26, Financial Management.


Sec. 1260.69  Electronic funds transfer payment methods.

Electronic Funds Transfer Payment Methods (Date)

    Payments under this grant will be made by the Government by 
electronic funds transfer through the Treasury Fedline Payment 
System (FEDLINE) or the Automated Clearing House (ACH), at the 
option of the Government. After award, but no later than 14 days 
before an invoice is submitted, the Recipient shall designate a 
financial institution for receipt of electronic funds transfer 
payments, and shall submit this designation to the Grant Officer or 
other Government official, as directed.
    (a) For payment through FEDLINE, the Recipient shall provide the 
following information:
    (1) Name, address, and telegraphic abbreviation of the financial 
institution receiving payment.
    (2) The American Bankers Association 9-digit identifying number 
for wire transfers of the financing institution receiving payment if 
the institution has access to the Federal Reserve Communication 
System.
    (3) Payee's account number at the financial institution where 
funds are to be transferred.
    (4) If the financial institution does not have access to the 
Federal Reserve Communications System, name, address, and 
telegraphic abbreviation of the correspondent financial institution 
through which the financial institution receiving payment obtains 
wire transfer activity. Provide the telegraphic abbreviation and 
American Bankers Association identifying number for the 
correspondent institution.
    (b) For payment through ACH, the Recipient shall provide the 
following information:
    (1) Routing transit number of the financial institution 
receiving payment (same as American Bankers Association identifying 
number used for FEDLINE).
    (2) Number of account to which funds are to be deposited.
    (3) Type of depositor account (``C'' for checking, ``S'' for 
savings).
    (4) If the Recipient is a new enrollee to the ACH system, a 
``Payment Information Form,'' SF 3881, must be completed before 
payment can be processed.
    (c) In the event the Recipient, during the performance of this 
grant, elects to designate a different financial institution for the 
receipt of any payment made using electronic funds transfer 
procedures, notification of such change and the required information 
specified above must be received by the appropriate Government 
official 30 days prior to the date such change is to become 
effective.
    (d) The documents furnishing the information required in this 
clause must be dated and contain the signature, title, and telephone 
number of the Recipient official authorized to provide it, as well 
as the Recipient's name and contract number.
    (e) Failure to properly designate a financial institution or to 
provide appropriate payee bank account information may delay 
payments of amounts otherwise properly due.
    (f) The requirements set forth in this special condition 
supercedes grant provision 1260.26, Financial Management.

Post-Award Requirements


Sec. 1260.70  Delegation of administration.

    (a) Property administration and closeout of NASA grants and 
cooperative agreements will be delegated to the Office of Naval 
Research (ONR). Exceptions to this policy are:
    (1) Training grants will not be delegated.
    (2) Grants of short duration (9 months or less) or low dollar value 
($50k or less) will normally not be delegated.
    (3) Grant officers may waive specific administration requirements 
in exceptional circumstances for individual grants. Exceptions to 
delegation must be justified and approved in writing by the grant 
officer, and made part of the file.
    (4) Waiver of delegation of property administration or closeout to 
be instituted by a center as a standard practice constitutes a 
deviation to this handbook, and requires approval in accordance with 
1260.7.
    (b) Delegations will be made by use of NF 1674 (Exhibit F to 
subpart A of this part 1260). The NF 1674, the award document, and the 
approved budget will be sent to ONR in a single package 
(electronically, when possible).
    (c) Upon acceptance of a delegation, ONR agrees to the following:
    (1) On a monthly basis, ONR will provide each center a Report of 
Accepted Delegations listing each grant or cooperative agreement 
accepted for administration, with pertinent information including the 
ONR point of contacts name, phone number, and e-mail address.
    (2) On a monthly basis, ONR will electronically send to each Center 
Commercial Technology Office a listing of New Technology Reports it has 
received.
    (3) On a quarterly basis, ONR will provide the cognizant grant 
officers a ``List of Delinquent Recipients'' that failed to provide 
timely interim or final reports.
    (4) Property administration should always be delegated, even if it 
is not anticipated that property will be provided by the government or 
acquired by the recipient. ONR shall follow DoD property administration 
policies and procedures, plus the following NASA requirements:
    (i) The recipient shall maintain property records and manage 
nonexpendable personal property in accordance with 14 CFR 1260.134. 
During Property Control System Analyses (PCSA), ONR will check the 
recipient's understanding and test compliance of property management 
requirements, including the accuracy of recipient property reports. ONR 
will provide one copy of each PCSA Report to the appropriate NASA 
center industrial property officer.
    (ii) ONR will investigate and notify NASA as appropriate for any 
unauthorized property acquisitions by the recipient. See the provision 
at 1260.27.
    (iii) ONR will notify the cognizant grant officer and industrial 
policy officer when property is lost, damaged or destroyed.
    (iv) Under no circumstances will Government property be disposed 
without instructions from NASA.
    (v) Prior to disposition, except when returned to NASA or 
reutilized on other NASA programs, ONR will ensure all NASA 
identifications are removed or obliterated from property, and hard 
drives of computers are cleared of sensitive or NASA owned/licensed 
software/data.


Sec. 1260.71  Supplements and renewals.

    (a) A NASA grant officer can unilaterally make minor or 
administrative changes to a grant; e.g., Reports Substitution 
(Sec. 1260.55) and Withholding (Sec. 1260.56).
    (b) To ensure timely completion and closeout of grants, renewal 
proposals to continue the same effort at the same institution that are 
accepted for award by NASA will be awarded as new grants versus 
continuation of the existing grant.
    (1) When work under a grant is to be continued through an 
extension, or through a renewal of the work under a new grant, the 
continuation effort should be instituted concurrent with the original 
expiration date. When possible, the period of performance should be 
continuous with the prior grant period of performance. The extension or 
a renewal of a grant (see Sec. 1260.13(a)) beyond the original 
expiration date is a unilateral decision by NASA based upon 
availability of funds, continued research relevance, and progress made 
by the recipient.
    (2) To insure uninterrupted programs, the technical office should 
forward to the grant office a completed award package, including a 
funded procurement request, technical evaluation of the proposed 
budget, and other support documentation, at least 29 days before the 
expiration of the funded period. .

[[Page 50351]]

    (c) Requests by the recipient to have a grant modified must be in 
writing to the grant officer. Prior approvals and changes are detailed 
in Sec. 1260.125.
    (d) A no-cost extension can be issued by the recipient as detailed 
in paragraph (b) of the provision at Sec. 1260.23, Extensions, and 
Sec. 1260.125(e). NASA reserves the right to disapprove the extension 
request if the requirements set forth at Sec. 1260.125(e)(2) are not 
met, including if the extension request is not received ten days prior 
to the grant expiration date.
    (e) When two or more actions are completed on a single supplement, 
the supplement will reflect the effective date of the earliest action.


Sec. 1260.72  Adherence to original budget estimates.

    (a) Although NASA assumes no responsibility for budget overruns, 
the recipient may spend grant funds without strict adherence to 
individual allocations within the proposed budgets, except that 
recipients must comply with prior approval requirements for property 
and subcontracts as provided in Sec. 1260.27 and Sec. 1260.33.
    (b) The revision of budgets and program plans are covered in 
Sec. 1260.125.


Sec. 1260.73  Transfers, novations, and change of name agreements.

    (a) When the principal investigator changes organizational 
affiliation and desires support for the research at a new location, 
(i.e., for the grant to be transferred), the grant officer should first 
consult with the institution that originally received the grant to 
ascertain whether an acceptable replacement principal investigator can 
be substituted to complete the research effort. The final decision on 
whether an acceptable replacement is available, or that the research 
effort should follow the original principal investigator to the new 
location, is at the discretion of the NASA technical Officer. If the 
decision is made to transfer the grant, the grant at the original 
institution must be terminated, and a new proposal must be submitted to 
NASA via the appropriate officials of the new institution. Although 
such a proposal will be reviewed in the normal manner, every effort 
will be made to expedite a decision. Regardless of the action taken on 
the new proposal, final reports on the original grant, describing the 
scientific progress and expenditure to date, will be required.
    (b) Novation and change of name agreements are administrative 
actions requiring the involvement of the grant officer. Novations are 
legal instruments under which obligations of an organization, 
(including the performance of grants), are assumed by a new 
organization arising out of a transfer of assets, usually as a result 
of a merger or acquisition by the new organization. Change of name 
agreements are legal instruments executed by an organization and NASA 
that recognizes the legal change of name of the organization without 
disturbing the original rights or obligations of the parties. 
Procedures for completing novation and change of name agreements are 
set forth at FAR subpart 42.12. All novation agreements and change of 
name agreements of the recipient, prior to execution, shall be reviewed 
by legal counsel for legal sufficiency. It is recommended that the 
cognizant ONR office be contacted to determine responsibilities to 
complete novation or change of name agreements.


Sec. 1260.74  Property use, disposition, and vesting of title.

    (a) Approval for acquisition of property shall conform to the 
following procedures:
    (1) Grant recipients should supply their own equipment and property 
to satisfy research requirements. Providing existing government 
equipment or property, or allowing acquisition of property by a grant 
recipient, should only be allowed in exceptional circumstances.
    (2) In accordance with OMB Circulars A-21 and A-122, prior approval 
of property acquisitions is required for special purpose equipment with 
a unit cost over $5,000, general purpose equipment with a unit cost 
over $5,000, (unless a lower threshold has been established by the 
recipient), or coherent systems (as defined in 1260.74(e)) with a value 
of over $5,000. The NASA grant officer will retain authority for 
approving the expenditure of grant funds for the acquisition of such 
equipment. Requests by grant recipients for the acquisition of 
equipment shall be supported by written documentation setting forth the 
description, purpose, and acquisition value of the equipment, and 
include a written certification that the equipment will be used 
exclusively for research. (A change in the model number of a prior 
approved piece of equipment does not require re-submission for that 
item.) NASA grant officers shall not approve the expenditure of grant 
funds for the acquisition of equipment unless the recipient's 
justification for the equipment demonstrates that the equipment will be 
used exclusively for research activities.
    (b) Vesting of title to property acquired by the recipient shall 
conform to the following procedures:
    (1) When a request for the acquisition of property has been 
approved, the NASA grant officer, in consultation with the technical 
officer, will determine whether NASA has an interest to retain title to 
the acquired property for use in future agency programs beyond the 
current grant effort. If NASA elects to take title to the equipment 
when no longer required for performance of the grant, NASA will notify 
the recipient in writing as part of the approval for acquiring the 
item. Generally, the notification is made through inclusion of the 
special condition at 1260.66, Listing of Reportable Equipment and Other 
Property. If the item was requested as part of the original budget, the 
award must specify NASA's intention to take title.
    (2) Unless there is clear rationale to retain title, as a general 
policy NASA encourages titling property to recipients as ``exempt'' 
when acquired by institutions of higher education, hospitals, and other 
non-profit organizations whose primary purpose is the conduct of 
scientific research. Unless NASA retains its rights to take title at 
the time of approval, equipment purchased with grant funds will be 
vested in the recipient as ``exempt'' equipment as set forth at 
1260.133(b). The recipient shall have no further obligation or 
accountability to the Federal Government for the use or disposition of 
``exempt'' property, including reporting requirements.
    (3) If NASA elects to take title to recipient acquired property, 
the property will be subject to 1260.132(b)(3).
    (4) Government titled property will be subject to the provisions 
for other Federally owned property as stated in 1260.133.
    (c) Equipment with a unit price of $5,000 or less (unless a lower 
threshold has been established by the recipient) is properly classified 
as ``supplies,'' is not subject to transfer to the Agency, and will be 
titled to the recipient in accordance with 1260.135.
    (d) Title to Federally-owned property remains with the Government, 
and is subject to the following additional requirements:
    (1) In accordance with Public Law 94-519, NASA will not acquire 
property from other agencies for use on NASA grants.
    (2) Government property provided to a grant recipient for use under 
a grant will be identified through inclusion of the special condition 
at Sec. 1260.66,

[[Page 50352]]

Listing of Reportable Equipment and Other Property.
    (3) When Federally-owned property is reported excess by a 
recipient, the administrative grant officer will report the equipment 
to the center industrial property officer, who will consult with the 
technical officer concerning property disposition.
    (4) NASA policy encourages the donation of existing, excess NASA 
property to nonprofit organizations whose primary purpose is the 
conduct of scientific research.
    (e) When two or more components are fabricated into a single 
coherent system in such a way that the components lose their separate 
identities, and their separation would render the system useless for 
its original purpose, the components will be considered as integral 
parts of a single system. If such a system includes recipient-owned 
components, the property will be considered to be exempt. The 
requirement for agreement regarding NASA's retention of its option to 
take title shall further apply where it is expected that one or more 
recipient-acquired components costing $5,000 or less will be fabricated 
into a single coherent system costing in excess of $5,000. However, an 
item that is used ancillary to a system, without loss of its separate 
identity and usefulness, will be considered as a separate item and not 
as an integral component of the system.
    (f) Property administration and plant clearance for all grants and 
cooperative agreements will be delegated to the appropriate ONR office.
    (g) NASA grant officers will provide copies of property related 
grant documentation to the center industrial property officer and to 
the Office of Naval Research (at time of award or modification) when 
the NASA program office elects to retain title to an existing item of 
Government property, to furnish the property to the recipient in lieu 
of donation, or to take title to property acquired by the recipient. 
When NASA acquires title to items of recipient acquired equipment or 
when NASA transfers an item of Government property to a recipient as 
Federally owned property, the NASA grant officer shall notify the 
cognizant NASA center financial management officer, the industrial 
property officer and Office of Naval Research to ensure proper entries 
in financial and property accounting records.


Sec. 1260.75  Summary of report requirements.

    (a) Report responsibilities of the grant officer are set forth as 
follows:
    (1) The grant officer is responsible for submitting the Individual 
Procurement Action Report (NF 507) for all grant and cooperative 
agreement actions.
    (2) The Committee on Academic Science and Engineering (CASE) Report 
(NF 1356), for grants and cooperative agreements awarded to educational 
institutions, is submitted by the program office with the basic award 
procurement request and completed by the grant officer. The grant 
officer should initiate an amendment to the NF 1356 whenever the 
principal investigator or the technical officer changes.
    (b) Intermediate report responsibilities of the recipient are as 
follows:
    (1) The Federal Cash Transactions Report (SF 272) shall be 
submitted by the recipient, in accordance with Sec. 1260.26(a), as a 
condition of receiving advance payments. Instructions and answers to 
payment questions will be provided by the Financial Management Office 
of the Center that issued the grant. (see Sec. 1260.152.)
    (2) The annual Inventory Report of Federally Owned Property in 
Custody of the Recipient will be submitted by the recipient as required 
by Sec. 1260.27(e). The listing shall include information specified in 
Sec. 1260.134(f) together with beginning and ending dollar value totals 
for the reporting period. Negative reports (i.e., where no property has 
been acquired or provided, or where all acquired property has been 
titled to the recipient as exempt) are not required. Please note that 
any property acquired by the recipient and not titled to the recipient 
as exempt, must be reported, even when titled to the recipient as non-
exempt property in accordance with the procedures set forth at 
Sec. 1260.134.
    (3) A Progress Report shall be submitted in accordance with 
Secs. 1260.22 and 1260.151. Recipients are not required to submit more 
than the original and two copies. At the request of the technical 
officer, technical reports can be submitted as new findings are made 
rather than on a predetermined time schedule, by use of the special 
condition at Sec. 1260.55, entitled ``Reports Substitution.''
    (4) An Educational Activity Report is required annually for 
education grants in accordance with Sec. 1260.22. The report is due 60 
days prior to the anniversary date of the grant or cooperative 
agreement.
    (5) A Report of Joint NASA/Recipient Inventions is required for all 
grants and cooperative agreements, as applicable, in accordance with 
Sec. 1260.28.
    (6) A Disclosure of Subject Invention is required for all grants 
and cooperative agreements, as applicable, in accordance with 
Sec. 1260.28. The reporting of the invention shall be made within two 
months after the inventor discloses it to the recipient, and will be 
reported on NASA Form 1679 Disclosure of Invention and New Technology 
(Including Software) in accordance with the procedures set forth under 
Sec. 1260.28.
    (7) An Election of Title to a Subject Invention is required for all 
grants and cooperative agreements, as applicable, in accordance with 
Sec. 1260.28. The notice is due within 1 year after disclosure of the 
subject invention if a statutory bar exists, otherwise within 2 years.
    (8) A Listing of Subject Inventions is required for all grants and 
cooperative agreement, in accordance with Sec. 1260.28. The listing is 
due annually.
    (9) A Notification of Decision to Forego Patent Protection is 
required for all grants and cooperative agreements, as applicable, in 
accordance with Sec. 1260.28. The notification is due 30 days before 
the expiration of the response period.
    (10) A Utilization of Subject Invention Report is required for all 
grants and cooperative agreements, as applicable, in accordance with 
Sec. 1260.28. The report is due annually.
    (11) A Notice of Proposed Transfer of Technology is required for 
all grants and cooperative agreements, as applicable, in accordance 
with Sec. 1260.30. The notice is required prior to transferring 
technology to a foreign firm or institution.
    (12) An Annual NASA Form 1018, NASA Property in the Custody of 
Contractors, is required for all grants and cooperative agreements with 
commercial organizations. The reports are due October 31st of each 
year. Negative reports (i.e., no reportable property) are required.
    (c) Final report responsibilities of the recipient are as follows:
    (1) A Subject Inventions Final Report is required for all grants 
and cooperative agreements, as applicable, in accordance with 
Sec. 1260.28. The report is due within 90 days after the expiration of 
the grant or cooperative agreement.
    (2) A properly certified Final Federal Cash Transactions Report, SF 
272, is required from the recipient for each grant, in accordance with 
Secs. 1260.26(a) and 1260.152. The report is due within 90 days after 
the expiration of the grant or cooperative agreement.
    (3) A Summary of Research is required for all research grants in 
accordance with Sec. 1260.22. Citation of publications resulting from 
research, or abstracts thereof, may serve as all or part

[[Page 50353]]

of the Summary of Research. The Summary of Research shall also include 
a complete list of all subject inventions (or negative statement) 
required to be disclosed that resulted from the work (see the provision 
at Sec. 1260.28).
    (4) A Final Inventory Report of Federally Owned Property, including 
equipment where title was taken by the Government, is required for all 
grants and cooperative agreements, where property or equipment has been 
provided by the government or acquired by the recipient, Sec. 1260.27. 
The report is due within 60 days after the expiration of the grant or 
cooperative agreement. Negative reports (i.e., where no property has 
been acquired or provided) are required.
    (5) A Final Educational Activity Report is required for all 
education grants or cooperative agreements. The report is due within 90 
days after the expiration of the grant or cooperative agreement.
    (6) A Faculty Advisor Survey is required for all training grants. 
The report is due from the student's faculty advisor within 60 days 
after the expiration of the training grant.
    (7) A Summary of Research is required for all training grants. The 
report is due from the student within 90 days after the expiration of 
the training grant.
    (8) An Administrative Report is required for all training grants. 
The report is due within 90 days after the expiration of the training 
grant.
    (9) A Student Evaluation Form is required for all training grants. 
The form is due from the student within 90 days after the expiration of 
the training grant.
    (10) A Final NASA Form 1018, NASA Property in the Custody of 
Contractors, is required for all grants and cooperative agreements with 
commercial organizations. The report is due within 30 days after the 
expiration of the grant or cooperative agreement.
    (d) To clarify report requirements to grant and cooperative 
agreement recipients, the grant officer will include the ``Required 
Publications and Reports'' form (Exhibit G to subpart A of this part 
1260) as part of the award document.


Sec. 1260.76  Termination and enforcement.

    (a) Suspension or termination of a grant prior to the planned 
expiration date must be reserved for exceptional situations that cannot 
be handled any other way (see Sec. 1260.160).
    (b) The Director, Program Operations Division (Code HS), shall 
provide to the General Services Administration information concerning 
all NASA debarments, suspensions, determinations of ineligibility, and 
voluntary exclusions of persons in accordance with 14 CFR 1265.505.
    (c) Remedies for Noncompliance are delineated in Sec. 1260.162.
    (d) Failure of the recipient to provide a required report can 
result in the Agency and the public being denied information about 
grant activities, NASA officials having less information for making 
decisions, grant closeout being delayed, and confidence being 
undermined as to whether the recipient will meet the requirements under 
other grants. Because NASA grants provide for advance payments, a 
recipient could be fully paid before final reports are due. At this 
point, it is too late to withhold payment on the existing grant.
    (e) Consistent with Secs. 1260.122(h) and 1260.162(a), NASA may 
suspend advanced payments from recipients that fail to comply with 
reporting requirements. To remedy failure to furnish timely reports, 
special condition at Sec. 1260.56, Withholding, should be used when 
awarding a new grant or modifying an existing grant with non-responsive 
organizations.
    (1) Special condition at Sec. 1260.56 allows the grant officer to 
instruct the Financial Management Office to suspend advanced payments 
under an institutions letter of credit pending receipt of the 
satisfactorily completed reports required in Sec. 1260.75.
    (2) The grant officer may waive the withholding requirement when 
the recipient has taken corrective action that makes withholding 
unnecessary. To release for payment the amount withheld, grant officers 
shall send a memorandum to their Financial Management Office.
    (3) The NASA Financial Management Office may require the grant 
officer to suspend or terminate a recipients advance payments when the 
recipient is not in compliance with requirements for receipt of 
advanced payments set forth in the NASA Financial Management Manual. 
For example, Advance payments may be suspended when two (2) successive 
quarterly reports are late or when more than two (2) reports are late 
in a fiscal year.


Sec. 1260.77  Closeout procedures.

    Closeout is the process by which NASA determines that all 
applicable administrative actions and all required work under the 
instrument have been completed by both the recipient and NASA and no 
further activity is expected (see Sec. 1260.171).
    (a) Closeout will begin within 90 days after the expiration date of 
the grant.
    (b) Those who are designated to receive NASA reports (except for 
CASI, which only acknowledges receipt) must provide certification to 
the NASA grant officer, and to ONR when delegated, that the reports 
have been received and satisfactorily completed. Electronic 
certifications are acceptable. See Secs. 1260.75 and 1260.171(a). The 
property certification should indicate that disposal of any remaining 
Government property has been made as directed and that NASA has been 
compensated for any residual inventory.
    (c) When ONR has been delegated closeout and has completed its 
actions, the NASA grant officer is to receive from ONR all of the 
following:
    (1) Certification that all required reports have been received and 
approved. However, when a NASA technical officer does not respond to a 
third request from ONR to provide a certification for a Summary of 
Research, ONR may provide a ``qualified acceptance statement'' in lieu 
of the required certification, after providing written notification to 
the NASA grant officer.
    (2) A DD Form 1593 Contract Administration Completion Record (or 
equivalent electronic notification), without supporting or backup 
documents, indicating property administration is complete.
    (3) An original, signed DD Form 1594 Contract Completion Statement.
    (d) A grant is administratively complete and ready for closeout 
when:
    (1) Property disposition has been completed.
    (2) Certifications for all reports have been received.
    (3) A DD Form 1594 has been received, when delegated.
    (4) Payments have been made for allowable reimbursable costs, and 
refunds have been received for any balance of unobligated cash advanced 
that is not authorized to be retained for use on other grants (see 
Secs. 1260.171 through 1260.173).
    (e) Grants will not be closed out if litigation or an appeal is 
pending, or when termination action has not been completed.
    (f) Records will be retained in accordance with Sec. 1260.153 and 
NPG 1441.1, Record Retention Schedules.

Appendix to Subpart A to Part 1260--Listing of Exhibits

Exhibit A--Budget Summary
Exhibit B--Standard Grant and Cooperative Agreement Cover Page
Exhibit C--Provisions
Exhibit D--Federal Demonstration Partnership Terms and Conditions
Exhibit E--Special Conditions for Cooperative Agreements between 
NASA and the Commercial Space Centers

[[Page 50354]]

Exhibit F--NASA 1674 Letter of Delegation for the Administration of 
Grants and Cooperative Agreements
Exhibit G--Required Publications and Reports
    Note: Exhibits are available at NASA Headquarters, Code HC, 
Washington, D.C. 20546.

Subpart B--Uniform Administrative Requirements for Grants and 
Cooperative Agreements With Institutions of Higher Education, 
Hospitals, and Other Non-Profit Organizations

General


Sec. 1260.101  Purpose.

    This subpart implements OMB Circular No. A-110 and establishes 
uniform administrative requirements for NASA grants and agreements 
awarded to institutions of higher education, hospitals, and other non-
profit organizations. NASA shall not impose additional or inconsistent 
requirements, except as provided in Secs. 1260.104 and 1260.114 or 
unless specifically required by Federal statute or executive order. 
Non-profit organizations that implement Federal programs for the States 
are also subject to State requirements.


Sec. 1260.102  Definitions.

    Accrued expenditures means the charges incurred by the recipient 
during a given period requiring the provision of funds for:
    (1) Goods and other tangible property received;
    (2) Services performed by employees, contractors, subcontractors, 
and other payees; and
    (3) Other amounts becoming owed under programs for which no current 
services or performance is required.
    Accrued income means the sum of:
    (1) Earnings during a given period from services performed by the 
recipient, and goods and other tangible property delivered to 
purchasers; and
    (2) Amounts becoming owed to the recipient for which no current 
services or performance is required by the recipient.
    Acquisition cost of equipment means the net invoice price of the 
equipment, including the cost of modifications, attachments, 
accessories, or auxiliary apparatus necessary to make the property 
usable for the purpose for which it was acquired. Other charges, such 
as the cost of installation, transportation, taxes, duty or protective 
in-transit insurance, shall be included or excluded from the unit 
acquisition cost in accordance with the recipient's regular accounting 
practices. Advance means a payment made by Treasury check or other 
appropriate payment mechanism to a recipient upon its request either 
before outlays are made by the recipient or through the use of 
predetermined payment schedules.
    Award means a grant or cooperative agreement that provides support 
or stimulation to accomplish a public purpose. Awards include research 
grants, training grants, facilities grants, educational grants, and 
cooperative agreements in the form of money or property in lieu of 
money, by NASA to an eligible recipient. The term does not include: 
technical assistance, which provides services instead of money; other 
assistance in the form of loans, loan guarantees, interest subsidies, 
or insurance; direct payments of any kind to individuals; and, 
contracts which are required to be entered into and administered under 
procure ment laws and regulations.
    Cash contributions means the recipient's cash outlay, including the 
outlay of money contributed to the recipient by third parties.
    Closeout means the process by which NASA determines that all 
applicable administrative actions and all required work of the award 
have been completed by the recipient and NASA.
    Contract means a procurement contract under an award, and a 
procurement subcontract under a recipient's contract.
    Cost sharing or matching means that portion of project or program 
costs not borne by NASA.
    Date of completion means the date on which all work under an award 
is completed or the date on the award document, or any supplement or 
amendment thereto, on which NASA sponsorship ends.
    Disallowed costs means those charges to an award that NASA 
determines to be unallowable, in accordance with the applicable Federal 
cost principles or other terms and conditions contained in the award.
    Equipment means tangible nonexpendable personal property including 
exempt property charged directly to the award having a useful life of 
more than one year and an acquisition cost of $5,000 or more per unit. 
However, consistent with recipient policy, lower limits may be 
established.
    Excess property means property under the control of any Federal 
awarding agency that, as determined by the head thereof, is no longer 
required for its needs or the discharge of its responsibilities.
    Exempt property means tangible personal property acquired in whole 
or in part with Federal funds, where a Federal awarding agency has 
statutory authority to vest title in the recipient without further 
obligation to the Federal Government. An example of exempt property 
authority is contained in the Federal Grant and Cooperative Agreement 
Act (31 U.S.C. 6306) for property acquired under an award to conduct 
basic or applied research by a non-profit institution of higher 
education or non-profit organi zation whose principal purpose is 
conducting scientific research.
    Federal funds authorized means the total amount of Federal funds 
obligated by the Federal Government for use by the recipient. This 
amount may include any authorized carryover of unobligated funds from 
prior funding periods when permitted by agency regulations or agency 
implementing instructions.
    Federal share of real property, equipment, or supplies means that 
percentage of the property's acquisition costs and any improvement 
expenditures paid with Federal funds.
    Funding period means the period of time when NASA funding is 
available for obligation by the recipient.
    Intangible property and debt instruments means, but is not limited 
to, trademarks, copyrights, patents and patent applications and such 
property as loans, notes and other debt instruments, lease agreements, 
stock and other instruments of property ownership, whether considered 
tangible or intangible.
    NASA means the National Aeronautics and Space Administration 
(NASA), including its authorized representatives.
    Obligations mean the amounts of orders placed, contracts and grants 
awarded, services received and similar transactions during a given 
period that require payment by the recipient during the same or a 
future period.
    Outlays or expenditures means charges made to the project or 
program. They may be reported on a cash or accrual basis. For reports 
prepared on a cash basis, outlays are the sum of cash disbursements for 
direct charges for goods and services, the amount of indirect expense 
charged, the value of third party in-kind contributions applied and the 
amount of cash advances and payments made to subcontractors. For 
reports prepared on an accrual basis, outlays are the sum of cash 
disbursements for direct charges for goods and services, the amount of 
indirect expense incurred, the value of in-kind contributions applied, 
and the net increase (or decrease) in the amounts owed by the recipient 
for goods and other property received, for services performed by 
employees, contractors, subcontractors and other

[[Page 50355]]

payees and other amounts becoming owed under programs for which no 
current services or performance are required.
    Personal property means property of any kind except real property. 
It may be tangible, having physical existence, or intangible, having no 
physical existence, such as copyrights, patents, or securities.
    Prior approval means written approval by an authorized official 
evidencing prior consent.
    Program income means gross income earned by the recipient that is 
directly generated by a supported activity or earned as a result of the 
award (see exclusions in 1260.124(c) and (f)). Program income includes, 
but is not limited to, income from fees for services performed, the use 
or rental of real or personal property acquired under federally-funded 
projects, the sale of commodities or items fabricated under an award, 
license fees and royalties on patents and copyrights, and interest on 
loans made with award funds. Interest earned on advances of NASA funds 
is not program income. Except as otherwise provided in the regulations 
in this subpart or the terms and conditions of the award, program 
income does not include the receipt of principal on loans, rebates, 
credits, discounts, etc., or interest earned on any of them.
    Project costs means all allowable costs, as set forth in the 
applicable Federal cost principles, incurred by a recipient and the 
value of the contributions made by third parties in accomplishing the 
objectives of the award during the project period.
    Project period means the period established in the award document 
during which NASA sponsorship begins and ends.
    Property means, unless otherwise stated, real property, equipment, 
intellectual property and debt instruments.
    Real property means land, including land improvements, structures 
and appurtenances thereto, but excludes movable machinery and 
equipment.
    Recipient means an organization receiving an award directly from 
NASA to carry out a project or program. The term includes public and 
private institutions of higher education, public and private hospitals, 
and other quasi-public and private non-profit organizations such as, 
but not limited to, community action agencies, research institutes, 
educational associations, and health centers. The term may include 
commercial organizations, foreign or international organizations (such 
as agencies of the United Nations) which are recipients, 
subcontractors, or contractors or subcontractors of recipients. The 
term does not include government-owned contractor-operated facilities 
or research centers providing continued support for mission-oriented, 
large-scale programs that are government-owned or controlled, or are 
designated as federally-funded research and development centers.
    Research and development means all research activities, both basic 
and applied, and all development activities that are supported at 
universities, colleges, and other nonprofit institutions. ``Research'' 
is defined as a systematic study directed toward fuller scientific 
knowledge or understanding of the subject studied. ``Development'' is 
the systematic use of knowledge and understanding gained from research 
directed toward the production of useful materials, devices, systems, 
or methods, including design and development of prototypes and 
processes. The term ``research'' also included activities involving the 
training of individuals in research techniques where such activities 
utilize the same facilities as other research and development 
activities and where such activities are not included in the 
instruction function.
    Small awards means a grant or cooperative agreement not exceeding 
the small purchase threshold.
    Subaward means an award of financial assistance in the form of 
money, or property in lieu of money, made under an award by a recipient 
to an eligible subrecipient or by a subrecipient to a lower tier 
subrecipient. The term includes financial assistance when provided by 
any legal agreement, even if the agreement is called a contract, but 
does not include procurement of goods and services nor does it include 
any form of assistance which is excluded from the definition of 
``award'' of this section.
    Subrecipient means the legal entity to which a subaward is made and 
which is accountable to the recipient for the use of the funds 
provided. The term may include foreign or international organizations 
(such as agencies of the United Nations).
    Supplies means all personal property excluding equipment, 
intellectual property, and debt instruments as defined in this section, 
and inventions of a contractor conceived or first actually reduced to 
practice in the performance of work under a funding agreement 
(``subject inventions''), as defined in 37 CFR part 401, ``Rights to 
Inventions Made by Nonprofit Organizations and Small Business Firms 
Under Government Grants, Contracts, and Cooperative Agreements.''
    Suspension means an action by NASA that temporarily withdraws NASA 
sponsorship under an award, pending corrective action by the recipient 
or pending a decision to terminate the award by NASA. Suspension of an 
award is a separate action from suspension under Federal agency 
regulations implementing Executive Orders 12549 and 12689, ``Debarment 
and Suspension.''
    Termination means the cancellation of Federal sponsorship, in whole 
or in part, under an agreement at any time prior to the date of 
completion.
    Third party in-kind contributions means the value of non-cash 
contributions provided by non-Federal third parties. Third party in-
kind contributions may be in the form of real property, equipment, 
supplies and other expendable property, and the value of goods and 
services directly benefiting and specifically identifiable to the 
project or program.
    Unliquidated obligations, for financial reports prepared on a cash 
basis, means the amount of obligations incurred by the recipient that 
have not been paid. For reports prepared on an accrued expenditure 
basis, they represent the amount of obligations incurred by the 
recipient for which an outlay has not been recorded.
    Unobligated balance means the portion of the funds authorized by 
NASA that has not been obligated by the recipient and is determined by 
deducting the cumulative obligations from the cumulative funds 
authorized.
    Unrecovered indirect cost means the difference between the amount 
awarded and the amount which could have been awarded under the 
recipient's approved negotiated indirect cost rate.
    Working capital advance means a procedure whereby funds are 
advanced to the recipient to cover its estimated disbursement needs for 
a given initial period.


Sec. 1260.103  Effect on other issuances.

    For awards subject to this subpart, the requirements of this 
subpart apply, except to the extent that any administrative 
requirements of codified program regulations, program manuals, 
handbooks and other nonregulatory materials are required by statute, or 
are authorized in accordance with the deviations provision in 
Sec. 1260.104.


Sec. 1260.104  Deviations.

    The Office of Management and Budget (OMB) may grant exceptions for 
classes of grants or recipients subject to the requirements of this 
subpart when exceptions are not prohibited by statute. However, in the 
interest of maximum

[[Page 50356]]

uniformity, exceptions from the requirements of this subpart shall be 
permitted only in unusual circumstances. NASA may apply more 
restrictive requirements to a class of recipients when approved by OMB. 
NASA may apply less restrictive requirements when awarding small 
awards, except for those requirements which are statutory. Exceptions 
on a case-by-case basis may also be made by NASA. See Sec. 1260.6(c).


Sec. 1260.105  Subawards.

    Unless sections of this subpart specifically exclude subrecipients 
from coverage, the provisions of this subpart shall be applied to 
subrecipients performing work under awards if such subrecipients are 
institutions of higher education, hospitals or other non-profit 
organizations. State and local government subrecipients are subject to 
the provisions of 14 CFR part 1273, ``Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments.''

Pre-Award Requirements


Sec. 1260.110  Purpose.

    Sections 1260.111 through 1260.117 prescribe forms and instructions 
and other pre-award matters to be used in applying for NASA awards.


Sec. 1260.111  Pre-award policies.

    (a) Use of grants and cooperative agreements, and contracts. In 
each instance, NASA shall decide on the appropriate award instrument 
(i.e. grant, cooperative agreement, or contract). The Federal Grant and 
Cooperative Agreement Act (31 U.S.C. 6301-08) governs the use of 
grants, cooperative agreements and contracts. A grant or cooperative 
agreement shall be used only when the principal purpose of a 
transaction is to accomplish a public purpose of support or stimulation 
authorized by Federal statute. The statutory criterion for choosing 
between grants and cooperative agreements is that for the latter, 
``substantial involvement is expected between the executive agency and 
the State, local government, or other recipient when carrying out the 
activity contemplated in the agreement.'' Contracts shall be used when 
the principal purpose is acquisition of property or services for the 
direct benefit or use of the Federal Government.
    (b) Public notice and priority setting. NASA notifies the public of 
its intended funding priorities for discretionary grant programs 
through Broad Agency Announcements, Cooperative Agreement Notices, 
Agency-Wide program announcements, and other approved forms of 
announcements.


Sec. 1260.112  Forms for applying for Federal assistance.

    (a) NASA shall comply with the applicable report clearance 
requirements of 5 CFR part 1320, ``Controlling Paperwork Burdens on the 
Public,'' with regard to all forms used by the NASA in place of or as a 
supplement to the Standard Form 424 (SF 424) series.
    (b) Applicants shall use those forms and instructions prescribed by 
NASA in Sec. 1260.10.


Sec. 1260.113  Debarment and suspension.

    NASA and recipients shall comply with the nonprocurement debarment 
and suspension rule, 14 CFR part 1265, ``Governmentwide Debarment and 
Suspension (Nonprocurement) and Governmentwide Requirements for Drug-
Free Workplace (Grants),'' implementing Executive Orders 12549 and 
12689, ``Debarment and Suspension.'' This rule restricts contracts with 
certain parties that are debarred, suspended or otherwise excluded from 
or ineligible for participation in Federal assistance programs or 
activities.


Sec. 1260.114  Special award conditions.

    If an applicant or recipient has a history of poor performance, is 
not financially stable, has a management system that does not meet the 
standards prescribed in this subpart, has not conformed to the terms 
and conditions of a previous award, or is not otherwise responsible, 
NASA may impose additional requirements as needed. Such applicant or 
recipient will be notified in writing as to the nature of the 
additional requirements, the reason why the additional requirements are 
being imposed, the nature of the corrective action needed, the time 
allowed for completing the corrective actions, and the method for 
requesting reconsideration of the additional requirements imposed. Any 
special conditions shall be promptly removed once the conditions that 
prompted them have been corrected.


Sec. 1260.115  Metric system of measurement.

    The Metric Conversion Act, as amended by the Omnibus Trade and 
Competitiveness Act (15 U.S.C. 205) declares that the metric system is 
the preferred measurement system for U.S. trade and commerce. The Act 
requires each Federal agency to establish a date or dates in 
consultation with the Secretary of Commerce, when the metric system of 
measurement will be used in the agency's procurements, grants, and 
other business-related activities. Metric implementation may take 
longer where the use of the system is initially impractical or likely 
to cause significant inefficiencies in the accomplishment of federally-
funded activities. NASA follows the provisions of Executive Order 
12770, ``Metric Usage in Federal Government Programs.'' NASA's policy 
with respect to the metric measurement system is stated in NASA Policy 
Directive (NPD) 8010.2, Use of the Metric System of Measurement in NASA 
Programs.


Sec. 1260.116  Resource Conservation and Recovery Act (RCRA).

    Under the RCRA (Public Law 94-580 codified at 42 U.S.C. 6962), any 
State agency or agency of a political subdivision of a State which is 
using appropriated Federal funds must comply with Section 6002 of the 
RCRA (42 U.S.C. 6962). Section 6002 requires that preference be given 
in procurement programs to the purchase of specific products containing 
recycled materials identified in guidelines developed by the 
Environmental Protection Agency (EPA) (40 CFR parts 247 through 254). 
Accordingly, State and local institutions of higher education, 
hospitals, and non-profit organizations that receive direct Federal 
awards or other Federal funds shall give preference in their 
procurement programs funded with Federal funds to the purchase of 
recycled products pursuant to the EPA guidelines.


Sec. 1260.117  Certifications and representations.

    Unless prohibited by statute or codified regulation, NASA will 
allow recipients to submit certain certifications and representations 
required by statute, executive order, or regulation on an annual basis, 
if the recipients have ongoing and continuing relationships with the 
agency. Annual certifications and representations shall be signed by 
responsible officials with the authority to ensure recipients' 
compliance with the pertinent requirements.

Post-Award Requirements

Financial and Program Management


Sec. 1260.120  Purpose of financial and program management.

    Sections 1260.121 through 1260.128 prescribe standards for 
financial management systems, methods for making payments and rules 
for: satisfying cost sharing and matching requirements, accounting for 
program income, budget revision approvals, making audits, determining 
allowability

[[Page 50357]]

of cost, and establishing fund availability.


Sec. 1260.121  Standards for financial management systems.

    (a) Recipients shall relate financial data to performance data and 
develop unit cost information whenever practical. For awards that 
support research, it should be noted that it is generally not 
appropriate to develop unit cost information.
    (b) Recipients' financial management systems shall provide for the 
following.
    (1) Accurate, current and complete disclosure of the financial 
results of each federally-sponsored project or program in accordance 
with the reporting requirements set forth in Sec. 1260.152. If NASA 
requires reporting on an accrual basis from a recipient that maintains 
its records on other than an accrual basis, the recipient shall not be 
required to establish an accrual accounting system. These recipients 
may develop such accrual data for its reports on the basis of an 
analysis of the documentation on hand.
    (2) Records that identify adequately the source and application of 
funds for federally-sponsored activities. These records shall contain 
information pertaining to Federal awards, authorizations, obligations, 
unobligated balances, assets, outlays, income and interest.
    (3) Effective control over and accountability for all funds, 
property and other assets. Recipients shall adequately safeguard all 
such assets and assure they are used solely for authorized purposes.
    (4) Comparison of outlays with budget amounts for each award. 
Whenever appropriate, financial information should be related to 
performance and unit cost data.
    (5) Written procedures to minimize the time elapsing between the 
transfer of funds to the recipient from the U.S. Treasury and the 
issuance or redemption of checks, warrants or payments by other means 
for program purposes by the recipient. To the extent that the 
provisions of the Cash Management Improvement Act (CMIA) (Public Law 
101-453) govern, payment methods of State agencies, instrumentalities, 
and fiscal agents shall be consistent with CMIA Treasury-State 
Agreements or the CMIA default procedures codified at 31 CFR part 205, 
``Withdrawal of Cash from the Treasury for Advances under Federal Grant 
and Other Programs.''
    (6) Written procedures for determining the reasonableness, 
allocability and allowability of costs in accordance with the 
provisions of the applicable Federal cost principles and the terms and 
conditions of the award.
    (7) Accounting records including cost accounting records that are 
supported by source documentation.
    (c) Where the Federal Government guarantees or insures the 
repayment of money borrowed by the recipient, NASA, at its discretion, 
may require adequate bonding and insurance if the bonding and insurance 
requirements of the recipient are not deemed adequate to protect the 
interest of the Federal Government.
    (d) NASA may require adequate fidelity bond coverage where the 
recipient lacks sufficient coverage to protect the Federal Government's 
interest.
    (e) Where bonds are required in the situations described in this 
section, the bonds shall be obtained from companies holding 
certificates of authority as acceptable sureties, as prescribed in 31 
CFR part 223, ``Surety Companies Doing Business with the United 
States.''


Sec. 1260.122  Payment.

    (a) Payment methods shall minimize the time elapsing between the 
transfer of funds from the United States Treasury and the issuance or 
redemption of checks, warrants, or payment by other means by the 
recipients. Payment methods of State agencies or instrumentalities 
shall be consistent with Treasury-State CMIA agreements or default 
procedures codified at 31 CFR part 205.
    (b)(1) Recipients are to be paid in advance, provided they maintain 
or demonstrate the willingness to maintain:
    (i) Written procedures that minimize the time elapsing between the 
transfer of funds and disbursement by the recipient; and
    (ii) Financial management systems that meet the standards for fund 
control and accountability as established in Sec. 1260.121.
    (2) Cash advances to a recipient organization shall be limited to 
the minimum amounts needed and be timed to be in accordance with the 
actual, immediate cash requirements of the recipient organization in 
carrying out the purpose of the approved program or project. The timing 
and amount of cash advances shall be as close as is administratively 
feasible to the actual disbursements by the recipient organization for 
direct program or project costs and the proportionate share of any 
allowable indirect costs.
    (c) Whenever possible, advances shall be consolidated to cover 
anticipated cash needs for all awards made by NASA to the recipient.
    (1) Advance payments will be made by electronic funds transfer.
    (2) Advance payment mechanisms are subject to 31 CFR part 205.
    (d) [Reserved. Not used by NASA.]
    (e) Reimbursement is the preferred method when the requirements in 
paragraph (b) of this section cannot be met. NASA may also use this 
method on any construction agreement, or if the major portion of the 
construction project is accomplished through private market financing 
or Federal loans, and the Federal assistance constitutes a minor 
portion of the project. When the reimbursement method is used, NASA 
shall make payment within 30 days after receipt of the billing, unless 
the billing is improper.
    (f) If a recipient cannot meet the criteria for advance payments 
and NASA has determined that reimbursement is not feasible because the 
recipient lacks sufficient working capital, NASA may provide cash on a 
working capital advance basis. Under this procedure, NASA shall advance 
cash to the recipient to cover its estimated disbursement needs for an 
initial period generally geared to the awardee's disbursing cycle. 
Thereafter, NASA shall reimburse the recipient for its actual cash 
disbursements. The working capital advance method of payment shall not 
be used for recipients unwilling or unable to provide timely advances 
to their subcontractor to meet the subcontractor's actual cash 
disbursements.
    (g) To the extent available, recipients shall disburse funds 
available from repayments to an interest earned on a revolving fund, 
program income, rebates, refunds, contract settlements, audit 
recoveries and interest earned on such funds before requesting 
additional cash payments.
    (h) Unless otherwise required by statute, NASA will not withhold 
payments for proper charges made by recipients at any time during the 
project period unless the conditions in paragraphs (h)(1) or (2) of 
this section apply.
    (1) A recipient has failed to comply with the project objectives, 
the terms and conditions of the award, or NASA reporting requirements.
    (2) The recipient is delinquent in a debt to the United States as 
defined in OMB Circular A-129, ``Managing Federal Credit Programs.'' 
Under such conditions, NASA may, upon reasonable notice, inform the 
recipient that payments shall not be made for obligations incurred 
after a specified date until the conditions are corrected or the 
indebtedness to the Federal Government is liquidated.

[[Page 50358]]

    (i) Standards governing the use of banks and other institutions as 
depositories of funds advanced under awards are as follows.
    (1) Except for situations described in paragraph (i)(2) of this 
section, NASA shall not require separate depository accounts for funds 
provided to a recipient or establish any eligibility requirements for 
depositories for funds provided to a recipient. However, recipients 
must be able to account for the receipt, obligation and expenditure of 
funds.
    (2) Advances of Federal funds shall be deposited and maintained in 
insured accounts whenever possible.
    (j) Consistent with the national goal of expanding the 
opportunities for women-owned and minority-owned business enterprises, 
recipients shall be encouraged to use women-owned and minority-owned 
banks (a bank which is owned at least 50 percent by women or minority 
group members).
    (k) Recipients shall maintain advances of Federal funds in interest 
bearing accounts, unless the conditions in paragraphs (k)(1), (2), or 
(3) of this section apply.
    (1) The recipient receives less than $120,000 in Federal awards per 
year.
    (2) The best reasonably available interest bearing account would 
not be expected to earn interest in excess of $250 per year on Federal 
cash balances.
    (3) The depository would require an average or minimum balance so 
high that it would not be feasible within the expected Federal and non-
Federal cash resources.
    (l) Interest earned on Federal advances deposited in interest-
bearing accounts in excess of $250 per year shall be remitted annually 
to Department of Health and Human Services (DHHS), Payment Management 
System, Rockville, MD 20852. Interest amounts up to $250 per year may 
be retained by the recipient for administrative expense. In accordance 
with 31 CFR part 206, interest should be remitted electronically 
through the Automated Clearing House (ACT) to DHHS. Recipients without 
this capability may make the remittance by check. In either case, the 
remittance should be payable to DHHS and should indicate the 
recipient's Entity Identification Number (EIN) and reason, i.e., 
``Interest earned.''
    (m) Except as noted elsewhere in this subpart, only the following 
forms shall be authorized for the recipients in requesting advances and 
reimbursements. Federal agencies shall not require more than an 
original and two copies of these forms.
    (1) SF-270, Request for Advance or Reimbursement. [Reserved. Not 
used by NASA.]
    (2) SF-271, Outlay Report and Request for Reimbursement for 
Construction Programs. The SF-271 may be used for requesting 
reimbursement for NASA construction programs.


Sec. 1260.123  Cost sharing or matching.

    (a) All contributions, including cash and third party in-kind, 
shall be accepted as part of the recipient's cost sharing or matching 
when such contributions meet all of the following criteria.
    (1) Are verifiable from the recipient's records.
    (2) Are not included as contributions for any other federally-
assisted project or program.
    (3) Are necessary and reasonable for proper and efficient 
accomplishment of project or program objectives.
    (4) Are allowable under the applicable cost principles.
    (5) Are not paid by the Federal Government under another award, 
except where authorized by Federal statute to be used for cost sharing 
or matching.
    (6) Are provided for in the approved budget when required by NASA.
    (7) Conform to other provisions of this subpart, as applicable.
    (b) Unrecovered indirect costs may be included as part of cost 
sharing or matching only with the prior approval of NASA.
    (c) Values for recipient contributions of services and property 
shall be established in accordance with the applicable cost principles. 
If NASA authorizes recipients to donate buildings or land for 
construction/facilities acquisition projects or long-term use, the 
value of the donated property for cost sharing or matching shall be the 
lesser of paragraph (c)(1) or (2) of this section.
    (1) The certified value of the remaining life of the property 
recorded in the recipient's accounting records at the time of donation.
    (2) The current fair market value. However, when there is 
sufficient justification, NASA may approve the use of the current fair 
market value of the donated property, even if it exceeds the certified 
value at the time of donation to the project.
    (d) Volunteer services furnished by professional and technical 
personnel, consultants, and other skilled and unskilled labor may be 
counted as cost sharing or matching if the service is an integral and 
necessary part of an approved project or program. Rates for volunteer 
services shall be consistent with those paid for similar work in the 
recipient's organization. In those instances in which the required 
skills are not found in the recipient organization, rates shall be 
consistent with those paid for similar work in the labor market in 
which the recipient competes for the kind of services involved. In 
either case, paid fringe benefits that are reasonable, allowable, and 
allocable may be included in the valuation.
    (e) When an employer other than the recipient furnishes the 
services of an employee, these services shall be valued at the 
employee's regular rate of pay (plus an amount of fringe benefits that 
are reasonable, allowable, and allocable, but exclusive of overhead 
costs), provided these services are in the same skill for which the 
employee is normally paid.
    (f) Donated supplies may include such items as expendable 
equipment, office supplies, laboratory supplies or workshop and 
classroom supplies. Value assessed to donated supplies included in the 
cost sharing or matching share shall be reasonable and shall not exceed 
the fair market value of the property at the time of the donation.
    (g) The method used for determining cost sharing or matching for 
donated equipment, buildings and land for which title passes to the 
recipient may differ according to the purpose of the award, if the 
conditions in paragraph (g)(1) or (2) of this section apply.
    (1) If the purpose of the award is to assist the recipient in the 
acquisition of equipment, buildings or land, the total value of the 
donated property may be claimed as cost sharing or matching.
    (2) If the purpose of the award is to support activities that 
require the use of equipment, buildings or land, normally only 
depreciation or use charges for equipment and buildings may be made. 
However, the full value of equipment or other capital assets and fair 
rental charges for land may be allowed, provided that NASA has approved 
the charges.
    (h) The value of donated property shall be determined in accordance 
with the usual accounting policies of the recipient, with the following 
qualifications:
    (1) The value of donated land and buildings shall not exceed its 
fair market value at the time of donation to the recipient as 
established by an independent appraiser (e.g., certified real property 
appraiser or General Services Administration representative) and 
certified by a responsible official of the recipient.

[[Page 50359]]

    (2) The value of donated equipment shall not exceed the fair market 
value of equipment of the same age and condition at the time of 
donation.
    (3) The value of donated space shall not exceed the fair rental 
value of comparable space as established by an independent appraisal of 
comparable space and facilities in a privately-owned building in the 
same locality.
    (4) The value of loaned equipment shall not exceed its fair rental 
value.
    (5) The following requirements pertain to the recipient's 
supporting records for in-kind contributions from third parties.
    (i) Volunteer services shall be documented and, to the extent 
feasible, supported by the same methods used by the recipient for its 
own employees.
    (ii) The basis for determining the valuation for personal service, 
material, equipment, buildings and land shall be documented.


Sec. 1260.124  Program income.

    (a) The standards set forth in this section shall be used to 
account for program income related to projects financed in whole or in 
part with Federal funds.
    (b) Program income earned during the project period shall be 
retained by the recipient and added to funds committed to the project 
by NASA and the recipient, and used to further eligible project or 
program objectives, unless NASA indicates in the terms and conditions 
of the award another alternative to account for program income or the 
recipient is subject to special award conditions, as indicated in 
1260.114.
    (c) Unless program regulations or the terms and conditions of the 
award provide otherwise, recipients shall have no obligation to the 
Federal Government regarding program income earned after the end of the 
project period.
    (d) Unless program regulations or the terms and conditions of the 
award provide otherwise, costs incident to the generation of program 
income may be deducted from gross income to determine program income, 
provided these costs have not been charged to the award.
    (e) Proceeds from the sale of property shall be handled in 
accordance with the requirements of the Property Standards (See 
1260.130 through 1260.137).
    (f) Unless program regulations or the terms and condition of the 
award provide otherwise, recipients shall have no obligation to the 
Federal Government with respect to program income earned from license 
fees and royalties for copyrighted material, patents, patent 
applications, trademarks, and inventions produced under an award. 
However, Patent and Trademark Amendments (35 U.S.C. 18) apply to 
inventions made under an experimental, developmental, or research 
award.


Sec. 1260.125  Revision of budget and program plans.

    (a) The budget plan is the financial expression of the project or 
program as approved during the award process. It may include either the 
Federal and non-Federal share, or only the Federal share, depending 
upon requirements in the regulations in this subpart. It shall be 
related to performance for program evaluation purposes whenever 
appropriate.
    (b) Recipients are required to report deviations from budget and 
program plans, and request prior approvals for budget and program plan 
revisions, in accordance with this section.
    (c) For nonconstruction awards, recipients shall request prior 
approvals from NASA for the following program or budget related 
reasons, except the item in paragraph (c)(5) of this section, which is 
waived by NASA.
    (1) Change in the scope or the objective of the project or program 
(even if there is no associated budget revision requiring prior written 
approval).
    (2) Change in a key person specified in the application or award 
document.
    (3) The absence for more than three months, or a 25 percent 
reduction in time devoted to the project, by the approved project 
director or principal investigator.
    (4) The need for additional Federal funding.
    (5) The transfer of amounts budgeted for indirect costs to absorb 
increases in direct costs, or vice versa.

    Notice: NASA waives prior approval of such revisions.

    (6) The inclusion of costs that require prior approval in 
accordance with OMB Circular A-21, ``Cost Principles for Institutions 
of Higher Education;'' OMB Circular A-122, ``Cost Principles for Non-
Profit Organizations;'' 45 CFR part 74 appendix E, ``Principles for 
Determining Costs Applicable to Research and Development under Grants 
and Contracts with Hospitals;'' or 48 CFR part 31, ``Contract Cost 
Principles and Procedures,'' as applicable.
    (7) The transfer of funds allotted for training allowances (direct 
payment to trainees) to other categories of expense.
    (8) Unless described in the application and funded in the approved 
awards, the subaward, transfer or contracting out of any work under an 
award. This provision does not apply to the purchase of supplies, 
material, equipment or general support services.
    (d) No other prior approval requirements for specific items will be 
imposed unless a deviation has been approved by OMB.
    (e) NASA has determined to waive the following cost-related and 
administrative prior written approvals otherwise required by OMB 
Circulars A-21, A-110 and A-122 to allow recipients to do the 
following:.
    (1) Incur pre-award costs 90 calendar days prior to award or more 
than 90 calendar days with the prior approval of NASA. All pre-award 
costs are incurred at the recipient's risk (i.e., NASA is under no 
obligation to reimburse such costs if for any reason the recipient does 
not receive an award or if the award is less than anticipated and 
inadequate to cover such costs).
    (2) Initiate a one-time extension of the expiration date of the 
award of up to 12 months unless one or more of the following conditions 
apply. For one-time extensions, the recipient must notify NASA in 
writing with the supporting reasons and revised expiration date at 
least 10 days before the expiration date specified in the award. This 
one-time extension may not be exercised merely for the purpose of using 
unobligated balances.
    (i) The terms and conditions of award prohibit the extension.
    (ii) The extension requires additional Federal funds.
    (iii) The extension involves any change in the approved objectives 
or scope of the project.
    (3) Unless directed otherwise by the grant officer, carry forward 
unobligated balances to subsequent funding periods.
    (f) Program regulations may restrict the transfer of funds among 
direct cost categories or programs, functions and activities for awards 
in which NASA's share of the project exceeds $100,000 and the 
cumulative amount of such transfers exceeds or is expected to exceed 10 
percent of the total budget as last approved by NASA. However, no 
program regulation shall permit a transfer that would cause any Federal 
appropriation or part thereof to be used for purposes other than those 
consistent with the original intent of the appropriation.
    (g) All other changes to nonconstruction budgets, except for the 
changes described in paragraph (j) of this section, do not require 
prior approval.
    (h) For construction awards, recipients shall request prior written 
approval promptly from NASA for budget revisions whenever the

[[Page 50360]]

conditions in paragraphs (h)(1), (2) or (3) of this section apply.
    (1) The revision results from changes in the scope or the objective 
of the project or program.
    (2) The need arises for additional Federal funds to complete the 
project.
    (3) A revision is desired which involves specific costs for which 
prior written approval requirements may be imposed consistent with 
applicable OMB cost principles listed in Sec. 1260.127.
    (i) No other prior approval requirements for specific items will be 
imposed unless a deviation has been approved by OMB.
    (j) When NASA makes an award that provides support for both 
construction and nonconstruction work, NASA requires the recipient to 
request prior approval from NASA before making any fund or budget 
transfers between the two types of work supported.
    (k) For both construction and nonconstruction awards, NASA requires 
recipients to notify NASA in writing promptly whenever the amount of 
Federal authorized funds is expected to exceed the needs of the 
recipient for the project period by more than $5,000 or five percent of 
the Federal award, whichever is greater. This notification shall not be 
required if an application for additional funding is submitted for a 
continuation award.
    (l) When requesting approval for budget revisions, recipients shall 
use the budget forms that were used in the application unless NASA 
indicates a letter of request suffices.
    (m) Within 30 calendar days from the date of receipt of the request 
for budget revisions, NASA shall review the request and notify the 
recipient whether the budget revisions have been approved. If the 
revision is still under consideration at the end of 30 calendar days, 
NASA shall inform the recipient in writing of the date when the 
recipient may expect the decision.


Sec. 1260.126  Non-Federal audits.

    (a) Recipients and subrecipients that are institutions of higher 
education or other non-profit organizations (including hospitals) shall 
be subject to the audit requirements contained in the Single Audit Act 
Amendments of 1966 (31 U.S.C. 7501-7507) and revised OMB Circular A-
133, ``Audits of States, Local Governments, and Other Non-Profit 
Institutions.''
    (b) State and local governments shall be subject to the audit 
requirements contained in the Single Audit Act Amendments of 1966 (31 
U.S.C. 7501-7507) and revised OMB Circular A-133, ``Audits of States, 
Local Governments, and Non-Profit Organizations.''
    (c) For-profit hospitals not covered by the audit provisions of 
revised OMB Circular A-133 shall be subject to the audit requirements 
of NASA.
    (d) Commercial organizations shall be subject to the audit 
requirements of NASA or the prime recipient as incorporated into the 
award document.


Sec. 1260.127  Allowable costs.

    For each kind of recipient, there is a set of Federal principles 
for determining allowable costs. Allowability of costs shall be 
determined in accordance with the cost principles applicable to the 
entity incurring the costs. Thus, allowability of costs incurred by 
State, local or federally-recognized Indian tribal governments is 
determined in accordance with the provisions of OMB Circular A-87, 
``Cost Principles for State and Local Governments.'' The allowability 
of costs incurred by non-profit organizations is determined in 
accordance with the provisions of OMB Circular A-122, ``Cost Principles 
for Non-Profit Organizations.'' The allowability of costs incurred by 
institutions of higher education is determined in accordance with the 
provisions of OMB Circular A-21, ``Cost Principles for Educational 
Institutions.'' The allowability of costs incurred by hospitals is 
determined in accordance with the provisions of appendix E of 45 CFR 
part 74, ``Principles for Determining Costs Applicable to Research and 
Development Under Grants and Contracts with Hospitals.'' The 
allowability of costs incurred by commercial organizations and those 
non-profit organizations listed in Attachment C to Circular A-122 is 
determined in accordance with the provisions of the Federal Acquisition 
Regulation (FAR) at 48 CFR part 31.


Sec. 1260.128  Period of availability of funds.

    Where a funding period is specified, a recipient may charge to the 
grant only allowable costs resulting from obligations incurred during 
the funding period and any pre-award costs authorized by NASA.

Property Standards


Sec. 1260.130  Purpose of property standards.

    Sections 1260.131 through 1260.137 set forth uniform standards 
governing management and disposition of property furnished by the 
Federal Government whose cost was charged to a project supported by a 
Federal award. Recipients shall observe these standards under awards 
and NASA will not impose additional requirements, unless specifically 
required by Federal statute. The recipient may use its own property 
management standards and procedures provided it observes the provisions 
of Secs. 1260.131 through 1260.137.


Sec. 1260.131  Insurance coverage.

    Recipients shall, at a minimum, provide the equivalent insurance 
coverage for real property and equipment acquired with Federal funds as 
provided for property owned by the recipient. Federally-owned property 
need not be insured unless required by the terms and conditions of the 
award.


Sec. 1260.132  Real property.

    Unless otherwise provided by statute, the requirements concerning 
the use and disposition of real property acquired in whole or in part 
under awards are as follows:
    (a) Title to real property shall vest in the recipient subject to 
the condition that the recipient shall use the real property for the 
authorized purpose of the project as long as it is needed and shall not 
encumber the property without approval of NASA.
    (b) The recipient shall obtain written approval by NASA for the use 
of real property in other federally-sponsored projects when the 
recipient determines that the property is no longer needed for the 
purpose of the original project. Use in other projects shall be limited 
to those under federally-sponsored projects (i.e., awards) or programs 
that have purposes consistent with those authorized for support by 
NASA.
    (c) When the real property is no longer needed as provided in 
paragraphs (a) and (b) of this section, the recipient shall request 
disposition instructions from NASA or its successor Federal awarding 
agency. NASA shall observe one or more of the following disposition 
instructions.
    (1) The recipient may be permitted to retain title without further 
obligation to the Federal Government after it compensates the Federal 
Government for that percentage of the current fair market value of the 
property attributable to the Federal participation in the project.
    (2) The recipient may be directed to sell the property under 
guidelines provided by NASA and pay the Federal Government for that 
percentage of the current fair market value of the property 
attributable to the Federal participation in the project (after 
deducting actual and reasonable selling and fix-up expenses, if any, 
from the sales proceeds). When the recipient is authorized or required 
to sell the property, proper sales procedures shall be established that 
provide for

[[Page 50361]]

competition to the extent practicable and result in the highest 
possible return.
    (3) The recipient may be directed to transfer title to the property 
to the Federal Government or to an eligible third party provided that, 
in such cases, the recipient shall be entitled to compensation for its 
attributable percentage of the current fair market value of the 
property.


Sec. 1260.133   Federally-owned and exempt property.

    (a) Federally-owned property. 
    (1) Title to federally-owned property remains vested in the Federal 
Government. Recipients shall submit annually an inventory listing of 
federally-owned property in their custody to NASA. Upon completion of 
the award or when the property is no longer needed, the recipient shall 
report the property to NASA for further Federal agency utilization.
    (2) If NASA has no further need for the property, it shall be 
declared excess and reported to the General Services Administration, 
unless NASA has statutory authority to dispose of the property by 
alternative methods (e.g., the authority provided by the Federal 
Technology Transfer Act (15 U.S.C. 3710 (I)) to donate research 
equipment to educational and non-profit organizations in accordance 
with Executive Order 12821, ``Improving Mathematics and Science 
Education in Support of the National Education Goals.'') Appropriate 
instructions shall be issued to the recipient by NASA.
    (b) Exempt property. Under the authority of the Childs Act, 31 
U.S.C. 6301 to 6308, NASA has determined, as a general rule, to vest 
title to property acquired with Federal funds in the recipient without 
further obligation to NASA, including reporting requirements. However, 
NASA reserves the right, on a case-by-case basis, to transfer title to 
equipment to NASA or to a third party named by NASA when the third 
party is eligible under existing statutes. Such equipment will be 
initially titled to the recipient upon acquisition in accordance with 
Sec. 1260.134, with instructions for title to be transferred to NASA 
when no longer needed in performance of the grant or cooperative 
agreement, in accordance with Sec. 1260.134(g)(4).


Sec. 1260.134   Equipment.

    (a) Title to equipment acquired by a recipient with Federal funds 
shall vest in the recipient, subject to conditions of this section.
    (b) The recipient shall not use equipment acquired with Federal 
funds to provide services to non-Federal outside organizations for a 
fee that is less than private companies charge for equivalent services, 
unless specifically authorized by Federal statute, for as long as the 
Federal Government retains an interest in the equipment.
    (c) The recipient shall use the equipment in the project or program 
for which it was acquired as long as needed, whether or not the project 
or program continues to be supported by Federal funds and shall not 
encumber the property without approval of NASA. When no longer needed 
for the original project or program, the recipient shall use the 
equipment in connection with its other federally-sponsored activities, 
in the following order of priority:
    (1) Activities sponsored by NASA, then
    (2) Activities sponsored by other Federal agencies.
    (d) During the time that equipment is used on the project or 
program for which it was acquired, the recipient shall make it 
available for use on other projects or programs if such other use will 
not interfere with the work on the project or program for which the 
equipment was originally acquired. First preference for such other use 
shall be given to other projects or programs sponsored by NASA; second 
preference shall be given to projects or programs sponsored by other 
Federal agencies. If the equipment is owned by the Federal Government, 
use on other activities not sponsored by the Federal Government shall 
be permissible if authorized by NASA. User charges shall be treated as 
program income.
    (e) When acquiring replacement equipment, the recipient may use the 
equipment to be replaced as trade-in or sell the equipment and use the 
proceeds to offset the costs of the replacement equipment subject to 
the approval of NASA.
    (f) The recipient's property management standards for equipment 
acquired with Federal funds and federally-owned equipment shall include 
all of the following:
    (1) Equipment records shall be maintained accurately and shall 
include the following information.
    (i) A description of the equipment.
    (ii) Manufacturer's serial number, model number, Federal stock 
number, national stock number, or other identification number.
    (iii) Source of the equipment, including the award number.
    (iv) Whether title vests in the recipient or the Federal 
Government.
    (v) Acquisition date (or date received, if the equipment was 
furnished by the Federal Government) and cost.
    (vi) Information from which one can calculate the percentage of 
Federal participation in the cost of the equipment (not applicable to 
equipment furnished by the Federal Government).
    (vii) Location and condition of the equipment and the date the 
information was reported.
    (viii) Unit acquisition cost.
    (ix) Ultimate disposition data, including date of disposal and 
sales price or the method used to determine current fair market value 
where a recipient compensates NASA for its share.
    (2) Equipment owned by the Federal Government shall be identified 
to indicate Federal ownership.
    (3) A physical inventory of equipment shall be taken and the 
results reconciled with the equipment records at least once every two 
years. Any differences between quantities determined by the physical 
inspection and those shown in the accounting records shall be 
investigated to determine the causes of the difference. The recipient 
shall, in connection with the inventory, verify the existence, current 
utilization, and continued need for the equipment.
    (4) A control system shall be in effect to insure adequate 
safeguards to prevent loss, damage, or theft of the equipment. Any 
loss, damage, or theft of equipment shall be investigated and fully 
documented; if the equipment was owned by the Federal Government, the 
recipient shall promptly notify NASA.
    (5) Adequate maintenance procedures shall be implemented to keep 
the equipment in good condition.
    (6) Where the recipient is authorized or required to sell the 
equipment, proper sales procedures shall be established which provide 
for competition to the extent practicable and result in the highest 
possible return.
    (g) When the recipient no longer needs the equipment, the equipment 
may be used for other activities in accordance with the following 
standards. For equipment with a current per unit fair market value of 
$5,000 or more, the recipient may retain the equipment for other uses 
provided that compensation is made to the original Federal awarding 
agency or its successor. The amount of compensation shall be computed 
by applying the percentage of Federal participation in the cost of the 
original project or program to the current fair market value of the 
equipment. If the recipient has no need for the equipment, the 
recipient shall request disposition instructions from NASA. NASA shall 
determine whether the equipment can be used to meet NASA`s 
requirements. If no requirement exists within NASA, the

[[Page 50362]]

availability of the equipment shall be reported to the General Services 
Administration by NASA to determine whether a requirement for the 
equipment exists in other Federal agencies. NASA shall issue 
instructions to the recipient no later than 120 calendar days after the 
recipient's request and the following procedures shall govern.
    (1) If so instructed or if disposition instructions are not issued 
within 120 calendar days after the recipient's request, the recipient 
shall sell the equipment and reimburse NASA an amount computed by 
applying to the sales proceeds the percentage of Federal participation 
in the cost of the original project or program. However, the recipient 
shall be permitted to deduct and retain from the Federal share $500 or 
ten percent of the proceeds, whichever is less, for the recipient's 
selling and handling expenses.
    (2) If the recipient is instructed to ship the equipment elsewhere, 
the recipient shall be reimbursed by the Federal Government by an 
amount which is computed by applying the percentage of the recipient's 
participation in the cost of the original project or program to the 
current fair market value of the equipment, plus any reasonable 
shipping or interim storage costs incurred.
    (3) If the recipient is instructed to otherwise dispose of the 
equipment, the recipient shall be reimbursed by NASA for such costs 
incurred in its disposition.
    (4) NASA may reserve the right to transfer the title to the Federal 
Government or to a third party named by NASA when such third party is 
otherwise eligible under existing statutes. Such transfer shall be 
subject to the following standards.
    (i) The equipment shall be appropriately identified in the award or 
otherwise made known to the recipient in writing.
    (ii) NASA shall issue disposition instructions within 120 calendar 
days after receipt of a final inventory. The final inventory shall list 
all equipment acquired with grant funds and federally-owned equipment. 
If NASA fails to issue disposition instructions within the 120 calendar 
day period, the recipient shall apply the standards of this section, as 
appropriate. When NASA exercises its right to take title, the equipment 
shall be subject to the provisions for federally-owned equipment.


Sec. 1260.135   Supplies and other expendable property.

    (a) Title to supplies and other expendable property shall vest in 
the recipient upon acquisition. If there is a residual inventory of 
unused supplies exceeding $5,000 in total aggregate value upon 
termination or completion of the project or program and the supplies 
are not needed for any other federally-sponsored project or program, 
the recipient shall retain the supplies for use on non-Federal 
sponsored activities or sell them, but shall, in either case, 
compensate the Federal Government for its share. The amount of 
compensation shall be computed in the same manner as for equipment.
    (b) The recipient shall not use supplies acquired with Federal 
funds to provide services to non-Federal outside organizations for a 
fee that is less than private companies charge for equivalent services, 
unless specifically authorized by Federal statute as long as the 
Federal Government retains an interest in the supplies.


Sec. 1260.136   Intangible property.

    (a) The recipient may assert copyright in any work that is 
copyrightable and was created, or for which copyright ownership was 
purchased, under an award. NASA is granted a royalty-free, nonexclusive 
and irrevocable right to reproduce, publish, prepare derivative works 
or otherwise use the work for Federal purposes, and to authorize others 
to do so.
    (b) Recipients are subject to applicable regulations governing 
patents and inventions, including government-wide regulations issued by 
the Department of Commerce at 37 CFR part 401, ``Rights to Inventions 
Made by Nonprofit Organizations and Small Business Firms Under 
Government Grants, Contracts and Cooperative Agreements.''
    (c) NASA has the right to:
    (1) Obtain, reproduce, publish, create derivative works or 
otherwise use the data first produced under an award.
    (2) Authorize others to receive, reproduce, publish, create 
derivative works or otherwise use such data for Federal purposes.
    (d) Title to intellectual property and debt instruments acquired 
under an award or subcontract vests upon acquisition in the recipient. 
The recipient shall use that property for the originally-authorized 
purpose, and the recipient shall not encumber the property without 
approval of NASA. When no longer needed for the originally authorized 
purpose, disposition of the intangible property shall occur in 
accordance with the provisions of Sec. 1260.134(g).
    (e) Due to the substantial involvement on the part of NASA under a 
cooperative agreement, intellectual property may be produced by Federal 
employees and NASA contractors tasked to perform NASA assigned 
activities. Title to intellectual property created under the 
cooperative agreement by NASA or its contractors will initially vest 
with the creating party. Certain rights may be exchanged with the 
recipient.


Sec. 1260.137   Property trust relationship.

    Real property, equipment, intangible property and debt instruments 
that are acquired or improved with Federal funds shall be held in trust 
by the recipient as trustee for the beneficiaries of the project or 
program under which the property was acquired or improved. NASA may 
require recipients to record liens or other appropriate notices of 
record to indicate that personal or real property has been acquired or 
improved with Federal funds and that use and disposition conditions 
apply to the property.

Procurement Standards


Sec. 1260.140   Purpose of procurement standards.

    Sections 1260.141 through 1260.148 set forth standards for use by 
recipients in establishing procedures for the procurement of supplies 
and other expendable property, equipment, real property and other 
services with Federal funds. These standards are furnished to ensure 
that such materials and services are obtained in an effective manner 
and in compliance with the provisions of applicable Federal statutes 
and executive orders. No additional procurement standards or 
requirements shall be imposed by NASA upon recipients, unless 
specifically required by Federal statute or executive order or approved 
in accordance with the deviation procedures of Sec. 1260.6.


Sec. 1260.141   Recipient responsibilities.

    The standards contained in this section do not relieve the 
recipient of the contractual responsibilities arising under its 
contract(s). The recipient is the responsible authority, without 
recourse to NASA, regarding the settlement and satisfaction of all 
contractual and administrative issues arising out of procurements 
entered into in support of an award or other agreement. This includes 
disputes, claims, protests of award, source evaluation or other matters 
of a contractual nature. Matters concerning violation of statute are to 
be referred to such Federal, State or local authority as may have 
proper jurisdiction.

[[Page 50363]]

Sec. 1260.142   Codes of conduct.

    The recipient shall maintain written standards of conduct governing 
the performance of its employees engaged in the award and 
administration of contracts. No employee, officer, or agent shall 
participate in the selection, award, or administration of a contract 
supported by Federal funds if a real or apparent conflict of interest 
would be involved. Such a conflict would arise when the employee, 
officer, or agent, any member of his or her immediate family, his or 
her partner, or an organization which employs or is about to employ any 
of the parties indicated herein, has a financial or other interest in 
the firm selected for an award. The officers, employees, and agents of 
the recipient shall neither solicit nor accept gratuities, favors, or 
anything of monetary value from contractors, or parties to 
subagreements. However, recipients may set standards for situations in 
which the financial interest is not substantial or the gift is an 
unsolicited item of nominal value. The standards of conduct shall 
provide for disciplinary actions to be applied for violations of such 
standards by officers, employees, or agents of the recipient.


Sec. 1260.143   Competition.

    All procurement transactions shall be conducted in a manner to 
provide, to the maximum extent practical, open and free competition. 
The recipient shall be alert to organizational conflicts of interest as 
well as noncompetitive practices among contractors that may restrict or 
eliminate competition or otherwise restrain trade. In order to ensure 
objective contractor performance and eliminate unfair competitive 
advantage, contractors that develop or draft specifications, 
requirements, statements of work, invitations for bids and/or requests 
for proposals shall be excluded from competing for such procurements. 
Awards shall be made to the bidder or offeror whose bid or offer is 
responsive to the solicitation and is most advantageous to the 
recipient, price, quality and other factors considered. Solicitations 
shall clearly set forth all requirements that the bidder or offeror 
shall fulfill in order for the bid or offer to be evaluated by the 
recipient. Any and all bids or offers may be rejected when it is in the 
recipient's interest to do so.


Sec. 1260.144   Procurement procedures.

    (a) All recipients shall establish written procurement procedures. 
These procedures shall provide for, at a minimum, that the conditions 
in paragraphs (a)(1), (2) and (3) of this section apply.
    (1) Recipients avoid purchasing unnecessary items.
    (2) Where appropriate, an analysis is made of lease and purchase 
alternatives to determine which would be the most economical and 
practical procurement for the Federal Government.
    (3) Solicitations for goods and services provide for all of the 
following:
    (i) A clear and accurate description of the technical requirements 
for the material, product or service to be procured. In competitive 
procurements, such a description shall not contain features which 
unduly restrict competition.
    (ii) Requirements which the bidder/offeror must fulfill and all 
other factors to be used in evaluating bids or proposals.
    (iii) A description, whenever practicable, of technical 
requirements in terms of functions to be performed or performance 
required, including the range of acceptable characteristics or minimum 
acceptable standards.
    (iv) The specific features of ``brand name or equal'' descriptions 
that bidders are required to meet when such items are included in the 
solicitation.
    (v) The acceptance, to the extent practicable and economically 
feasible, of products and services dimensioned in the metric system of 
measurement.
    (vi) Preference, to the extent practicable and economically 
feasible, for products and services that conserve natural resources and 
protect the environment and are energy efficient.
    (b) Positive efforts shall be made by recipients to utilize small 
businesses, minority-owned firms, and women's business enterprises, 
whenever possible. Recipients of NASA awards shall take all of the 
following steps to further this goal.
    (1) Ensure that small businesses, minority-owned firms, and women's 
business enterprises are used to the fullest extent practicable.
    (2) Make information on forthcoming opportunities available and 
arrange time frames for purchases and contracts to encourage and 
facilitate participation by small businesses, minority-owned firms, and 
women's business enterprises.
    (3) Consider in the contract process whether firms competing for 
larger contracts intend to subcontract with small businesses, minority-
owned firms, and women's business enterprises.
    (4) Encourage contracting with consortiums of small businesses, 
minority-owned firms and women's business enterprises when a contract 
is too large for one of these firms to handle individually.
    (5) Use the services and assistance, as appropriate, of such 
organizations as the Small Business Administration and the Department 
of Commerce's Minority Business Development Agency in the solicitation 
and utilization of small businesses, minority-owned firms and women's 
business enterprises.
    (c) The type of procuring instruments used (e.g., fixed price 
contracts, cost reimbursable contracts, purchase orders, and incentive 
contracts) shall be determined by the recipient but shall be 
appropriate for the particular procurement and for promoting the best 
interest of the program or project involved.
    The ``cost-plus-a-percentage-of-cost'' or ``percentage of 
construction cost'' methods of contracting shall not be used.
    (d) Contracts shall be made only with responsible contractors who 
possess the potential ability to perform successfully under the terms 
and conditions of the proposed procurement. Consideration shall be 
given to such matters as contractor integrity, record of past 
performance, financial and technical resources or accessibility to 
other necessary resources. In certain circumstances, contracts with 
certain parties are restricted by 14 CFR part 1265, the implementation 
of Executive Orders 12549 and 12689, ``Debarment and Suspension.''
    (e) Recipients shall, on request, make available for NASA, pre-
award review and procurement documents, such as request for proposals 
or invitations for bids, independent cost estimates, etc., when any of 
the following conditions apply.
    (1) A recipient's procurement procedures or operation fails to 
comply with the procurement standards in NASA's implementation of this 
subpart.
    (2) The procurement is expected to exceed the small purchase 
threshold and is to be awarded without competition or only one bid or 
offer is received in response to a solicitation.
    (3) The procurement, which is expected to exceed the small purchase 
threshold, specifies a ``brand name'' product.
    (4) The proposed award over the small purchase threshold is to be 
awarded to other than the apparent low bidder under a sealed bid 
procurement.
    (5) A proposed contract modification changes the scope of a 
contract or increases the contract amount by more than the amount of 
the small purchase threshold.


Sec. 1260.145  Cost and price analysis.

    Some form of cost or price analysis shall be made and documented in 
the procurement files in connection with every procurement action. 
Price analysis

[[Page 50364]]

may be accomplished in various ways, including the comparison of price 
quotations submitted, market prices and similar indicia, together with 
discounts. Cost analysis is the review and evaluation of each element 
of cost to determine reasonableness, allocability and allowability.


Sec. 1260.146  Procurement records.

    Procurement records and files for purchases in excess of the small 
purchase threshold shall include the following at a minimum:
    (a) Basis for contractor selection,
    (b) Justification for lack of competition when competitive bids or 
offers are not obtained, and
    (c) Basis for award cost or price.


Sec. 1260.147  Contract administration.

    A system for contract administration shall be maintained to ensure 
contractor conformance with the terms, conditions and specifications of 
the contract and to ensure adequate and timely follow up of all 
purchases. Recipients shall evaluate contractor performance and 
document, as appropriate, whether contractors have met the terms, 
conditions and specifications of the contract.


Sec. 1260.148  Contract provisions.

    The recipient shall include, in addition to provisions to define a 
sound and complete agreement, the following provisions in all 
contracts. The following provisions shall also be applied to 
subcontracts.
    (a) Contracts in excess of the small purchase threshold shall 
contain contractual provisions or conditions that allow for 
administrative, contractual, or legal remedies in instances in which a 
contractor violates or breaches the contract terms, and provide for 
such remedial actions as may be appropriate.
    (b) All contracts in excess of the small purchase threshold shall 
contain suitable provisions for termination by the recipient, including 
the manner by which termination shall be effected and the basis for 
settlement. In addition, such contracts shall describe conditions under 
which the contract may be terminated for default as well as conditions 
where the contract may be terminated because of circumstances beyond 
the control of the contractor.
    (c) Except as otherwise required by statute, an award that requires 
the contracting (or subcontracting) for construction or facility 
improvements shall provide for the recipient to follow its own 
requirements relating to bid guarantees, performance bonds, and payment 
bonds unless the construction contract or subcontract exceeds $100,000. 
For those contracts or subcontracts exceeding $100,000, NASA may accept 
the bonding policy and requirements of the recipient, provided the NASA 
has made a determination that the Federal Government's interest is 
adequately protected. If such a determination has not been made, the 
minimum requirements shall be as follows.
    (1) A bid guarantee from each bidder equivalent to five percent of 
the bid price. The ``bid guarantee'' shall consist of a firm commitment 
such as a bid bond, certified check, or other negotiable instrument 
accompanying a bid as assurance that the bidder shall, upon acceptance 
of his bid, execute such contractual documents as may be required 
within the time specified.
    (2) A performance bond on the part of the contractor for 100 
percent of the contract price. A ``performance bond'' is one executed 
in connection with a contract to secure fulfillment of all the 
contractor's obligations under such contract.
    (3) A payment bond on the part of the contractor for 100 percent of 
the contract price. A ``payment bond'' is one executed in connection 
with a contract to assure payment as required by statute of all persons 
supplying labor and material in the execution of the work provided for 
in the contract.
    (4) Where bonds are required in the situations described in this 
section, the bonds shall be obtained from companies holding 
certificates of authority as acceptable sureties pursuant to 31 CFR 
part 223, ``Surety Companies Doing Business with the United States.''
    (d) All negotiated contracts (except those for less than the small 
purchase threshold) awarded by recipients shall include a provision to 
the effect that the recipient, NASA, the Comptroller General of the 
United States, or any of their duly authorized representatives, shall 
have access to any books, documents, papers and records of the 
contractor which are directly pertinent to a specific program for the 
purpose of making audits, examinations, excerpts and transcriptions.
    (e) All contracts, including small purchases, awarded by recipients 
and their contractors shall contain the procurement provisions of 
appendix A to this subpart, as applicable.

Reports and Records


Sec. 1260.150  Purpose of reports and records.

    Sections 1260.151 through 1260.153 set forth the procedures for 
monitoring and reporting on the recipient's financial and program 
performance and the necessary standard reporting forms. They also set 
forth record retention requirements.


Sec. 1260.151  Monitoring and reporting program performance.

    (a) Recipients are responsible for managing and monitoring each 
project, program, subcontract, function or activity supported by the 
award. Recipients shall monitor subcontracts to ensure subcontractors 
have met the audit requirements as delineated in Sec. 1260.126.
    (b) The terms and conditions of the award shall prescribe the 
frequency with which the performance reports shall be submitted. Except 
as provided in Sec. 1260.151(f), performance reports shall not be 
required more frequently than quarterly or, less frequently than 
annually. Annual reports shall be due 90 calendar days after the grant 
year; quarterly or semi-annual reports shall be due 30 days after the 
reporting period. NASA may require annual reports before the 
anniversary dates of multiple year awards in lieu of these 
requirements. The final performance reports are due 90 calendar days 
after the expiration or termination of the award.
    (c) If inappropriate, a final technical or performance report shall 
not be required after completion of the project.
    (d) When required, performance reports shall generally contain, for 
each award, brief information on each of the following.
    (1) A comparison of actual accomplishments with the goals and 
objectives established for the period, the findings of the 
investigator, or both. Whenever appropriate and the output of programs 
or projects can be readily quantified, such quantitative data should be 
related to cost data for computation of unit costs.
    (2) Reasons why established goals were not met, if appropriate.
    (3) Other pertinent information including, when appropriate, 
analysis and explanation of cost overruns or high unit costs.
    (e) Recipients shall not be required to submit more than the 
original and two copies of performance reports.
    (f) Recipients shall immediately notify NASA of developments that 
have a significant impact on the award-supported activities. Also, 
notification shall be given in the case of problems, delays, or adverse 
conditions which materially impair the ability to meet the objectives 
of the award. This notification shall include a statement of the action 
taken or contemplated, and any assistance needed to resolve the 
situation.

[[Page 50365]]

    (g) NASA may make site visits, as needed.
    (h) NASA shall comply with clearance requirements of 5 CFR part 
1320 when requesting performance data from recipients.


Sec. 1260.152  Financial reporting.

    (a) When funds are advanced to recipients, each recipient is 
required to submit the SF 272, Report of Federal Cash Transactions, 
and, when necessary, its continuation sheet, SF 272a. NASA uses this 
report to monitor cash advanced to the recipient and obtain 
disbursement information for each agreement with the recipient.
    (b) NASA requires forecasts of the recipient's cash requirements 
for each of the four months following the quarter being reported, in 
the ``Remarks'' section of the report.
    (c) Recipients are required to submit the original of the report to 
the Financial Management Office of the NASA Center which issued the 
agreement 15 working days following the end of each Federal fiscal 
quarter. Copies will be furnished to the appropriate grant officer.


Sec. 1260.153  Retention and access requirements for records.

    (a) This section sets forth requirements for record retention and 
access to records for awards to recipients. NASA shall not impose any 
other record retention or access requirements upon recipients.
    (b) Financial records, supporting documents, statistical records, 
and all other records pertinent to an award shall be retained for a 
period of three years from the date of submission of the final 
expenditure report or, for awards that are renewed quarterly or 
annually, from the date of the submission of the quarterly or annual 
financial report, as authorized by NASA. The only exceptions are the 
following.
    (1) If any litigation, claim, or audit is started before the 
expiration of the three-year period, the records shall be retained 
until all litigation, claims or audit findings involving the records 
have been resolved and final action taken.
    (2) Records for real property and equipment acquired with Federal 
funds shall be retained for 3 years after final disposition.
    (3) When records are transferred to or maintained by NASA, the 3-
year retention requirement is not applicable to the recipient.
    (4) Indirect cost rate proposals, cost allocations plans, etc. as 
specified in Sec. 1260.153(g).
    (c) Copies of original records may be substituted for the original 
records if authorized by NASA.
    (d) NASA shall request transfer of certain records to its custody 
from recipients when it determines that the records possess long term 
retention value. However, in order to avoid duplicate record keeping, 
NASA may make arrangements for recipients to retain any records that 
are continuously needed for joint use.
    (e) NASA, the Inspector General, Comptroller General of the United 
States, or any of their duly authorized representatives, have the right 
of timely and unrestricted access to any books, documents, papers, or 
other records of recipients that are pertinent to the awards, in order 
to make audits, examinations, excerpts, transcripts and copies of such 
documents. This right also includes timely and reasonable access to a 
recipient's personnel for the purpose of interview and discussion 
related to such documents. The rights of access in this paragraph are 
not limited to the required retention period, but shall last as long as 
records are retained.
    (f) Unless required by statute, NASA shall place no restrictions on 
recipients that limit public access to the records of recipients that 
are pertinent to an award, except when NASA can demonstrate that such 
records shall be kept confidential and would have been exempted from 
disclosure pursuant to the Freedom of Information Act (5 U.S.C. 552) if 
the records had belonged to NASA.
    (g) Indirect cost rate proposals, cost allocations plans, etc. 
Paragraphs (g)(1) and (g)(2) of this section apply to the following 
types of documents, and their supporting records: Indirect cost rate 
computations or proposals, cost allocation plans, and any similar 
accounting computations of the rate at which a particular group of 
costs is chargeable (such as computer usage chargeback rates or 
composite fringe benefit rates).
    (1) If submitted for negotiation. If the recipient submits to NASA 
or the subrecipient submits to the recipient the proposal, plan, or 
other computation to form the basis for negotiation of the rate, then 
the 3-year retention period for its supporting records starts on the 
date of such submission.
    (2) If not submitted for negotiation. If the recipient is not 
required to submit to NASA or the subrecipient is not required to 
submit to the recipient the proposal, plan, or other computation for 
negotiation purposes, then the 3-year retention period for the 
proposal, plan, or other computation and its supporting records starts 
at the end of the fiscal year (or other accounting period) covered by 
the proposal, plan, or other computation.

Termination and Enforcement


Sec. 1260.160  Purpose of termination and enforcement.

    Sections 1260.61 and 1260.62 set forth uniform suspension, 
termination and enforcement procedures.


Sec. 1260.161  Termination.

    (a) Awards may be terminated in whole or in part only if the 
conditions in paragraph (a)(1), (2) or (3) of this section apply.
    (1) By NASA, if a recipient materially fails to comply with the 
terms and conditions of an award.
    (2) By NASA with the consent of the recipient, in which case the 
two parties shall agree upon the termination conditions, including the 
effective date and, in the case of partial termination, the portion to 
be terminated.
    (3) By the recipient upon sending to NASA written notification 
setting forth the reasons for such termination, the effective date, 
and, in the case of partial termination, the portion to be terminated. 
However, if NASA determines in the case of partial termination that the 
reduced or modified portion of the grant will not accomplish the 
purposes for which the grant was made, it may terminate the grant in 
its entirety under either paragraphs (a)(1) or (2) of this section.
    (b) If costs are allowed under an award, the responsibilities of 
the recipient referred to in Sec. 1260.171(a), including those for 
property management as applicable, shall be considered in the 
termination of the award, and provision shall be made for continuing 
responsibilities of the recipient after termination, as appropriate.


Sec. 1260.162  Enforcement.

    (a) Remedies for noncompliance. If a recipient materially fails to 
comply with the terms and conditions of an award, whether stated in a 
Federal statute, regulation, assurance, application, or notice of 
award, NASA may, in addition to imposing any of the special conditions 
outlined in Sec. 1260.114, take one or more of the following actions, 
as appropriate in the circumstances.
    (1) Temporarily withhold cash payments pending correction of the 
deficiency by the recipient or more severe enforcement action by NASA.
    (2) Disallow (that is, deny both use of funds and any applicable 
matching credit for) all or part of the cost of the activity or action 
not in compliance.

[[Page 50366]]

    (3) Wholly or partly suspend or terminate the current award.
    (4) Withhold further awards.
    (5) Take other remedies that may be legally available.
    (b) Hearings and appeals. In taking an enforcement action, NASA 
shall provide the recipient an opportunity for hearing, appeal, or 
other administrative proceeding to which the recipient is entitled 
under any statute or regulation applicable to the action involved.
    (c) Effects of suspension and termination. Costs of a recipient 
resulting from obligations incurred by the recipient during a 
suspension or after termination of an award are not allowable unless 
NASA expressly authorizes them in the notice of suspension or 
termination or subsequently. Other recipient costs during suspension or 
after termination which are necessary and not reasonably avoidable are 
allowable if the conditions in paragraph (c)(1) and (2) of this section 
apply.
    (1) The costs result from obligations which were properly incurred 
by the recipient before the effective date of suspension or 
termination, are not in anticipation of it, and in the case of a 
termination, are noncancellable.
    (2) The costs would be allowable if the award were not suspended or 
expired normally at the end of the funding period in which the 
termination takes effect.
    (d) Relationship to debarment and suspension. The enforcement 
remedies identified in this section, including suspension and 
termination, do not preclude a recipient from being subject to 
debarment and suspension under Executive Orders 12549 and 12689 and 14 
CFR part 1265 (see Sec. 1260.113).

After-the-Award Requirements


Sec. 1260.170  Purpose.

    Sections 1260.171 through 1260.173 contain closeout procedures and 
other procedures for subsequent disallowances and adjustments.


Sec. 1260.171  Closeout procedures.

    (a) Recipients shall submit, within 90 calendar days after the date 
of completion of the award, all financial, performance, and other 
reports as required by the terms and conditions of the award. NASA may 
approve extensions when requested by the recipient.
    (b) Unless NASA authorizes an extension, a recipient shall 
liquidate all obligations incurred under the award not later than 90 
calendar days after the funding period or the date of completion as 
specified in the terms and conditions of the award or in agency 
implementing instructions.
    (c) NASA shall make prompt payments to a recipient for allowable 
reimbursable costs under the award being closed out.
    (d) The recipient shall promptly refund any balances of unobligated 
cash that NASA has advanced or paid and that is not authorized to be 
retained by the recipient for use in other projects. OMB Circular A-129 
governs unreturned amounts that become delinquent debts.
    (e) When authorized by the terms and conditions of the award, NASA 
shall make a settlement for any upward or downward adjustments to the 
Federal share of costs after closeout reports are received.
    (f) The recipient shall account for any real and personal property 
acquired with Federal funds or received from the Federal Government in 
accordance with Secs. 1260.131 through 1260.137.
    (g) In the event a final audit has not been performed prior to the 
closeout of an award, NASA shall retain the right to recover an 
appropriate amount after fully considering the recommendations on 
disallowed costs resulting from the final audit.


Sec. 1260.172  Subsequent adjustments and continuing responsibilities.

    (a) The closeout of an award does not affect any of the following.
    (1) The right of NASA to disallow costs and recover funds on the 
basis of a later audit or other review.
    (2) The obligation of the recipient to return any funds due as a 
result of later refunds, corrections, or other transactions.
    (3) Audit requirements in Sec. 1260.126.
    (4) Property management requirements in Secs. 1260.131 through 
1260.137.
    (5) Records retention as required in Sec. 1260.153.
    (b) After closeout of an award, a relationship created under an 
award may be modified or ended in whole or in part with the consent of 
the NASA and the recipient, provided the responsibilities of the 
recipient referred to in Sec. 1260.173(a), including those for property 
management as applicable, are considered and provisions made for 
continuing responsibilities of the recipient, as appropriate.


Sec. 1260.173  Collection of amounts due.

    (a) Any funds paid to a recipient in excess of the amount to which 
the recipient is finally determined to be entitled under the terms and 
conditions of the award constitute a debt to the Federal Government. If 
not paid within a reasonable period after the demand for payment, NASA 
may reduce the debt by the provisions of paragraph (a)(1), (2) or (3) 
of this section
    (1) Making an administrative offset against other requests for 
reimbursements.
    (2) Withholding advance payments otherwise due to the recipient.
    (3) Taking other action permitted by statute.
    (b) Except as otherwise provided by law, NASA shall charge interest 
on an overdue debt in accordance with 4 CFR chapter II, ``Federal 
Claims Collection Standards.''

Appendix A to Subpart B of Part 1260--Contract Provisions

    All contracts awarded by a recipient, including small purchases, 
shall contain the following provisions as applicable:
    1. Equal Employment Opportunity. All contracts shall contain a 
provision requiring compliance with Executive Order 11246, ``Equal 
Employment Opportunity,'' as amended by Executive Order 11375, 
``Amending Executive Order 11246 Relating to Equal Employment 
Opportunity,'' and as supplemented by regulations at 41 CFR Part 60, 
``Office of Federal Contract Compliance Programs, Equal Employment 
Opportunity, Department of Labor.''
    2. Copeland ``Anti-Kickback'' Act (18 U.S.C. 874 and 40 U.S.C. 
276c). All contracts in excess of $2,000 for construction or repair 
awarded by recipients shall include a provision for compliance with 
the Copeland ``Anti-Kickback'' Act (18 U.S.C. 874), as supplemented 
by Department of Labor regulations (29 CFR Part 3, ``Contractors and 
Subcontractors on Public Building or Public Work Financed in Whole 
or in Part by Loans or Grants from the United States''). The Act 
provides that each contractor shall be prohibited from inducing, by 
any means, any person employed in the construction, completion, or 
repair of public work, to give up any part of the compensation to 
which he is otherwise entitled. The recipient shall report all 
suspected or reported violations to NASA.
    3. Davis-Bacon Act, as amended (40 U.S.C. 276a to a-7). When 
required by Federal program legislation, all construction contracts 
awarded by the recipients of more than $2,000 shall include a 
provision for compliance with the Davis-Bacon Act (40 U.S.C. 276a to 
a-7) and as supplemented by Department of Labor regulations (29 CFR 
Part 5, ``Labor Standards Provisions Applicable to Contracts 
Governing Federally Financed and Assisted Construction''). Under 
this Act, contractors shall be required to pay wages to laborers and 
mechanics at a rate not less than the minimum wages specified in a 
wage determination made by the Secretary of Labor. In addition, 
contractors shall be required to pay wages not less than once a 
week. The recipient shall place a copy of the current prevailing 
wage determination issued by the Department of Labor in each 
solicitation and the award of a contract shall be conditioned upon 
the acceptance of the wage determination. The recipient shall

[[Page 50367]]

report all suspected or reported violations to the NASA.
    4. Contract Work Hours and Safety Standards Act (40 U.S.C. 327-
333). Where applicable, all contracts awarded by recipients in 
excess of $2,000 for construction contracts and in excess of $2,500 
for other contracts that involve the employment of mechanics or 
laborers shall include a provision for compliance with Sections 102 
and 107 of the Contract Work Hours and Safety Standards Act (40 
U.S.C. 327-333), as supplemented by Department of Labor regulations 
(29 CFR part 5). Under Subsection 102 of the Act, each contractor 
shall be required to compute the wages of every mechanic and laborer 
on the basis of a standard work week of 40 hours. Work in excess of 
the standard work week is permissible provided that the worker is 
compensated at a rate of not less than 1\1/2\ times the basic rate 
of pay for all hours worked in excess of 40 hours in the work week. 
Section 107 of the Act is applicable to construction work and 
provides that no laborer or mechanic shall be required to work in 
surroundings or under working conditions which are unsanitary, 
hazardous or dangerous. These requirements do not apply to the 
purchases of supplies or materials or articles ordinarily available 
on the open market, or contracts for transportation or transmission 
of intelligence.
    5. Rights to Inventions Made Under a Contract or Agreement. 
Contracts or agreements for the performance of experimental, 
developmental, or research work shall provide for the rights of the 
Federal Government and the recipient in any resulting invention in 
accordance with 37 CFR part 401, ``Rights to Inventions Made by 
Nonprofit Organizations and Small Business Firms Under Government 
Grants, Contracts and Cooperative Agreements,'' and any implementing 
regulations issued by the awarding agency.
    6. Clean Air Act (42 U.S.C. 7401 et seq.) and the Federal Water 
Pollution Control Act (33 U.S.C. 1251 et seq.), as amended. 
Contracts of amounts in excess of $100,000 shall contain a provision 
that requires the recipient to agree to comply with all applicable 
standards, orders or regulations issued pursuant to the Clean Air 
Act (42 U.S.C. 7401 et seq.) and the Federal Water Pollution Control 
Act as amended (33 U.S.C. 1251 et seq.). Violations shall be 
reported to NASA and the Regional Office of the Environmental 
Protection Agency (EPA).
    7. Byrd Anti-Lobbying Amendment (31 U.S.C. 1352). Contractors 
who apply or bid for an award of $100,000 or more shall file the 
required certification. Each tier certifies to the tier above that 
it will not and has not used Federal appropriated funds to pay any 
person or organization for influencing or attempting to influence an 
officer or employee of any agency, a member of Congress, officer or 
employee of Congress, or an employee of a member of Congress in 
connection with obtaining any Federal contract, grant or any other 
award covered by 31 U.S.C. 1352. Each tier shall also disclose any 
lobbying with non-Federal funds that takes place in connection with 
obtaining any Federal award. Such disclosures are forwarded from 
tier to tier up to the recipient.
    8. Debarment and Suspension (Executive Orders 12549 and 12689). 
No contract shall be made to parties listed on the General Services 
Administration's List of Parties Excluded from Federal Procurement 
or Nonprocurement Programs in accordance with Executive Orders 12549 
and 12689, ``Debarment and Suspension.'' This list contains the 
names of parties debarred, suspended, or otherwise excluded by 
agencies, and contractors declared ineligible under statutory or 
regulatory authority other than Executive Order 12549. Contractors 
with awards that exceed the small purchase threshold shall provide 
the required certification regarding its exclusion status and that 
of its principal employees.

    2. Part 1274 is revised to read as follows:

PART 1274--COOPERATIVE AGREEMENTS WITH COMMERCIAL FIRMS

Subpart A--General

Sec.
1274.101  Purpose.
1274.102  Definitions.
1274.103  Effect on other issuances.
1274.104  Deviations.
1274.105  Approval of Cooperative Agreement Notices (CANs) and 
cooperative agreements.

Subpart B--Pre-Award Requirements

1274.201  Purpose.
1274.202  Solicitations and proposals.
1274.203  Intellectual property.
1274.204  Evaluation and selection.
1274.205  Award procedures.
1274.206  Document format and numbering.
1274.207  Distribution of cooperative agreements.

Subpart C--Administration

1274.301  Delegation of administration.
1274.302  Transfers, novations, and change of name agreements.

Subpart D--Government Property

1274.401  Government property.

Subpart E--Procurement Standards

1274.501  Subcontracts.

Subpart F--Reports and Records

1274.601 Retention and access requirements for records.

Subpart G--Suspension or Termination

1274.701  Suspension or termination.

Subpart H--After-the-Award Requirements

1274.801  Purpose.
1274.802  Closeout procedures.
1274.803  Subsequent adjustments and continuing responsibilities.

Subpart I--Provisions and Special Conditions

1274.901  Other provisions and special conditions.
1274.902  Purpose.
1274.903  Responsibilities.
1274.904  Resource sharing requirements.
1274.905  Rights in data.
1274.906  Designation of new technology representative and patent 
representative.
1274.907  Disputes.
1274.908  Milestone payments.
1274.909  Term of this agreement.
1274.910  Authority.
1274.911  Patent rights.
1274.912  Patent rights--retention by the Recipient (large 
business).
1274.913  Patent rights--retention by the Recipient (small 
business).
1274.914  Requests for waiver of rights--large business.
1274.915  Restrictions on sale or transfer of technology to foreign 
firms or institutions.
1274.916  Liability and risk of loss.
1274.917  Additional funds.
1274.918  Incremental funding.
1274.919  Cost principles and accounting standards.
1274.920  Responsibilities of the NASA Technical Officer.
1274.921  Publications and reports: Non-proprietary research 
results.
1274.922  Suspension or termination.
1274.923  Equipment and other property.
1274.924  Civil rights.
1274.925  Subcontracts.
1274.926  Clean Air-Water Pollution Control Acts.
1274.927  Debarment and suspension and Drug-Free Workplace.
1274.928  Foreign national employee investigative requirements.
1274.929  Restrictions on lobbying.
1274.930  Travel and transportation.
1274.931  Electronic funds transfer payment methods.
1274.932  Retention and examination of records.
1274.933  Summary of recipient reporting responsibilities.
1274.934  Safety.

Appendix to Part 1274--Listing of Exhibits

Exhibit A to Part 1274--Contract Provisions
Exhibit B to Part 1274--Reports

    Authority: 31 U.S.C. 6301 to 6208; 42 U.S.C. 2451 et seq.

Subpart A--General


Sec. 1274.101  Purpose.

    (a) This part establishes uniform administrative requirements for 
NASA cooperative agreements awarded to commercial firms. Cooperative 
agreements are ordinarily entered into with commercial firms to--
    (1) Support research and development;
    (2) Provide technology transfer from the Government to the 
recipient; or
    (3) Develop a capability among U.S. firms to potentially enhance 
U.S. competitiveness.
    (b) An award may not be made to a foreign government. Award to 
foreign firms is not precluded. The approval of the Associate 
Administrator for

[[Page 50368]]

Procurement is required to exclude foreign firms from submitting 
proposals.


Sec. 1274.102  Definitions.

    Administrator. The Administrator or Deputy Administrator of NASA.
    Associate Administrator for Procurement. The head of the Office of 
Procurement, NASA Headquarters (Code H).
    Cash contributions. The recipient's cash outlay, including the 
outlay of money contributed to the recipient by third parties.
    Closeout. The process by which NASA determines that all applicable 
administrative actions and all required work of the award have been 
completed by the recipient and NASA.
    Commercial item. The definition in FAR 2.101 is applicable.
    Cooperative agreement. As defined by 31 U.S.C. 6305, cooperative 
agreements are financial assistance instruments used to stimulate or 
support activities for authorized purposes and in which the Government 
participates substantially in the performance of the effort. This part 
covers only cooperative agreements with commercial firms. Cooperative 
agreements with universities and non-profit organizations are covered 
by 14 CFR part 1260.
    Cost sharing or matching. That portion of project or program costs 
not borne by the Federal Government except that the recipient's 
contribution may be reimbursable under other Government awards as 
allowable IR&D costs pursuant to 48 CFR (NFS) 1831.205-18.
    Date of completion. The date on which all work under an award is 
completed or the date on the award document, or any supplement or 
amendment thereto, on which NASA sponsorship ends.
    Days. Calendar days, unless otherwise indicated.
    Government furnished equipment. Equipment in the possession of, or 
acquired directly by, the Government and subsequently delivered, or 
otherwise made available, to a Recipient and equipment procured by the 
Recipient with Government funds under a cooperative agreement.
    Grant Officer. A Government employee who has been delegated the 
authority to negotiate, award, or administer grants or cooperative 
agreements. A Contracting Officer may serve as a Grant Officer if 
authorized by installation procurement regulations.
    Incremental funding. A method of funding a cooperative agreement 
where the funds initially allotted to the cooperative agreement are 
less than the award amount. Additional funding is added as described in 
1274.918.
    Recipient. An organization receiving financial assistance under a 
cooperative agreement to carry out a project or program. A recipient 
may be an individual firm, a consortium, a partnership, etc.
    Resource contribution. The total value of resources provided by 
either party to the cooperative agreement including both cash and non-
cash contributions.
    Support contractor. A NASA contractor performing part or all of the 
NASA responsibilities under a cooperative agreement.
    Suspension. An action by NASA or the recipient that temporarily 
discontinues efforts under an award, pending corrective action or 
pending a decision to terminate the award. Suspension of an award is a 
separate action from suspension under Federal agency regulations 
implementing Executive Orders 12549 and 12689, ``Debarment and 
Suspension.''
    Technical officer. The official of the cognizant NASA office who is 
responsible for monitoring the technical aspects of the work under a 
cooperative agreement. A Contracting Officer's Technical Representative 
may serve as a Technical Officer.
    Termination. The cancellation of a cooperative agreement in whole 
or in part, by either party at any time prior to the date of 
completion.


Sec. 1274.103  Effect on other issuances.

    For awards subject to this subpart, the requirements of this 
subpart apply, except to the extent that any administrative 
requirements of codified program regulations, program manuals, 
handbooks and other nonregulatory materials are required by statute, or 
are authorized in accordance with the deviations provision in 
Sec. 1274.104.


Sec. 1274.104  Deviations.

    (a) The Associate Administrator for Procurement may grant 
exceptions for classes of or individual cooperative agreements from the 
requirements of this part when exceptions are not prohibited by 
statute.
    (b) Applicability. A deviation is required for any of the 
following:
    (1) When a prescribed provision set forth in this part for use 
verbatim is modified or omitted.
    (2) When a provision is set forth in this part, but not prescribed 
for use verbatim, and the installation substitutes a provision which is 
inconsistent with the intent, principle, and substance of the 
prescribed provision.
    (3) When a NASA form or other form is prescribed by this part, and 
that form is altered or another form is used in its place.
    (4) When limitations, imposed by this part upon the use of a 
provision, form, procedure, or any other action, are not adhered to.
    (c) Request for deviations. Requests for authority to deviate from 
this part will be forwarded to Headquarters, Program Operations 
Division (Code HS). Such requests, signed by the Procurement Officer, 
shall contain as a minimum:
    (1) A full description of the deviation and identification of the 
regulatory requirement from which a deviation is sought.
    (2) Detailed rationale for the request, including any pertinent 
background information.
    (3) The name of the recipient and identification of the cooperative 
agreement affected, including the dollar value.
    (4) A statement as to whether the deviation has been requested 
previously, and, if so, circumstances of the previous request(s).
    (5) A copy of legal counsel's concurrence or comments.


Sec. 1274.105  Approval of Cooperative Agreement Notices (CANs) and 
cooperative agreements.

    (a) As soon as possible after the initial decision is made by a 
Headquarters program office or Center procurement personnel to use the 
CAN process, the cognizant program office or procurement office shall 
notify the Associate Administrator for Procurement (Code HS) of the 
intent to use a CAN in all cases where the total Government funds to be 
awarded in response to CAN proposals is expected to equal or exceed $10 
million. All such notifications, as described in this section, shall be 
concurred in by the Procurement Officer. This requirement also applies 
in those cases where an unsolicited proposal is received and a decision 
is made to award a cooperative agreement in which the recipient (or one 
or more members of a ``team'' of recipients) is a commercial firm and 
the total Government funds are expected to equal or exceed $10 million.
    (b) The required notification is to be accomplished by sending an 
electronic mail (e-mail) message to the following address at NASA 
Headquarters: [email protected]. The notification must include the 
following information, as a minimum:
    (1) Identification of the cognizant center and program office,
    (2) Description of the proposed program for which proposals are to 
be solicited,

[[Page 50369]]

    (3) Rationale for decision to use a CAN rather than other types of 
solicitations,
    (4) The amount of Government funding to be available for awards,
    (5) Estimate of the number of cooperative agreements to be awarded 
as a result of the CAN,
    (6) The percentage of cost-sharing to be required,
    (7) Tentative schedule for release of CAN and award of cooperative 
agreements,
    (8) If the term of the cooperative agreement is anticipated to 
exceed 3 years and/or if the Government cash contribution is expected 
to exceed $20M, address anticipated changes, if any, to the provisions 
(see 1274.202(f)), and
    (9) If the cooperative agreement is for programs/projects that 
provide aerospace products or capabilities, (i.e., provide space and 
aeronautics, flight and ground systems, technologies and operations), a 
statement that the requirements of NASA Policy Directive (NPD) 7120.4 
and NASA Policy Guidance (NPG) 7120.5 have been met. This affirmative 
statement will include a specific reference to the signed Program 
Commitment Agreement.
    (c) Code HS will respond by e-mail message to the sender, with a 
copy of the message to the Procurement Officer and the Office of Small 
and Disadvantaged Business Utilization, within 5 working days of 
receipt of this initial notification. The response will address the 
following:
    (1) Whether Code HS agrees or disagrees with the appropriateness 
for using a CAN for the effort described,
    (2) Whether Code HS will require review and approval of the CAN 
before its issuance,
    (3) Whether Code HS will require review and approval of the 
selected offeror's cost sharing arrangement (e.g., cost sharing 
percentage; type of contribution (cash, labor, etc.)), and
    (4) Whether Code HS will require review and approval of the 
resulting cooperative agreement(s).
    (d) If a response from Code HS is not received within 5 working 
days of notification, the program office or center may proceed with 
release of the CAN and award of the cooperative agreements as 
described.

Subpart B--Pre-Award Requirements


Sec. 1274.201  Purpose.

    Sections 1274.202 through 1274.207 prescribe forms and instructions 
and address other pre-award matters.


Sec. 1274.202  Solicitations and proposals.

    (a) Consistent with 31 U.S.C. 6301(3), NASA uses competitive 
procedures to award cooperative agreements whenever possible. An award 
will normally be made as a result of a Cooperative Agreement Notice 
(CAN) which envisions a cooperative agreement as the award instrument. 
A Commerce Business Daily synopsis or a synopsis on the NASA 
Acquisition Internet Service will be used to publicize the CAN.
    (b) Unsolicited proposals. (1) An award may be made as a result of 
an unsolicited proposal. The unsolicited proposal must evidence a 
unique and innovative idea or approach which is not the subject of a 
current or anticipated solicitation. When a cooperative agreement is 
awarded as a result of an unsolicited proposal, a Commerce Business 
Daily synopsis and a synopsis on the NASA Acquisition Internet Service 
will be used to provide an opportunity for other firms/consortia to 
express an interest in the agreement unless the exception in 48 CFR 
(FAR) 5.202(a)(8) applies. Respondents should be given a minimum of 
thirty days to respond. If interest is expressed, a decision must be 
made to proceed with the award or to issue a solicitation for 
competitive proposals.
    (2) Prior to an award made as the result of an unsolicited 
proposal, the award must be approved by the Procurement Officer if 
NASA's total resource contribution is below $5 million. Center Director 
approval is required if NASA's total resource contribution is $5 
million or more. For Headquarters cooperative agreements, approval by 
the Associate Administrator for Procurement is required if NASA's total 
resource contribution is $5 million or more.
    (c) Cost and payment matters. (1) The expenditure of Government 
funds by the Recipient and the allowability of costs recognized as a 
resource contribution by the Recipient shall be governed by the FAR 
cost principles, 48 CFR part 31. If the Recipient is a consortium which 
includes non-commercial entities as members, cost allowability for 
those members will be determined as follows:
    (i) Allowability of costs incurred by State, local or federally-
recognized Indian tribal governments is determined in accordance with 
the provisions of OMB Circular A-87, ``Cost Principles for State and 
Local Governments.''
    (ii) The allowability of costs incurred by non-profit organizations 
is determined in accordance with the provisions of OMB Circular A-122, 
``Cost Principles for Non-Profit Organizations.''
    (iii) The allowability of costs incurred by institutions of higher 
education is determined in accordance with the provisions of OMB 
Circular A-21, ``Cost Principles for Educational Institutions.''
    (iv) The allowability of costs incurred by hospitals is determined 
in accordance with the provisions of Appendix E of 45 CFR Part 74, 
``Principles for Determining Costs Applicable to Research and 
Development Under Grants and Contracts with Hospitals.'' Recipient's 
method for accounting for the expenditure of funds must be consistent 
with Generally Accepted Accounting Principles.
    (2) Cost sharing. A substantial resource contribution on the part 
of the Recipient is required. The Recipient is expected to contribute 
at least 50 percent of the total resources required to accomplish the 
cooperative agreement. Recipient contributions may be either cash or 
non-cash or both. In those cases in which a contribution of less than 
50 percent is anticipated from the Recipient, approval of the Associate 
Administrator for Procurement (Code HS) is required prior to award. The 
request for approval should address the evaluation factor in the 
solicitation and how the proposal accomplishes those objectives to such 
a degree that a share ratio of less than 50 percent is warranted.
    (3) Fixed funding. Cooperative agreements are funded by NASA in a 
fixed amount. Payments in fixed amounts will be made by NASA in 
accordance with ``Milestone Billings'' which are discussed in paragraph 
(c)(4) of this section. If the Recipient completes the final milestone, 
final payment is made, and NASA will have completed its financial 
responsibilities under the agreement. However, if the cooperative 
agreement is terminated prior to achievement of all milestones, NASA's 
funding will be limited to milestone payments already made plus NASA's 
share of costs required by the Recipient to meet commitments which had 
in the judgment of NASA become firm prior to the effective date of 
termination and are otherwise appropriate. In no event shall these 
additional costs or payment exceed the amount of the next payable 
milestone billing amount.
    (4) Milestone billings is the method of payment to the Recipient 
under cooperative agreements. Performance based milestones are used as 
the basis of establishing a set of verifiable milestones for payment 
purposes. Each milestone payment shall be established so that the 
Government payment is at the same share ratio as the cooperative

[[Page 50370]]

agreement share ratio. If the Recipient is a consortium, the Articles 
of Collaboration is required to contain an extensive list of 
performance based milestones that the consortium has agreed to. 
Generally, payments should not be made more than once monthly; ideally, 
payments will be made about every 60 to 90 days but in all cases should 
be made on the basis of verifiable, significant events as opposed to 
the passage of time. The last payment milestone should be large enough 
to ensure that the Recipient completes its responsibilities under the 
cooperative agreement (or funds should be reserved for payment until 
after completion of the cooperative agreement). The Government 
technical officer must verify completion of each milestone to the Grant 
Officer as part of the payment process.
    (5) Incremental funding. Cooperative agreements may be 
incrementally funded subject to the following:
    (i) The total value of the NASA cash contribution is $50,000 or 
more.
    (ii) The period of performance overlaps the succeeding fiscal year.
    (iii) The funds are not available to fully fund the cooperative 
agreement at the time of award.
    (6) Cost sharing. Cost sharing requirements on cooperative 
agreements with commercial firms are based on Section 23 of OMB 
Circular A-110. Only cash or certain non-cash resources are acceptable 
sources for the Recipient contribution to a cooperative agreement. 
Acceptable non-cash resources include such items as purchased 
equipment, equipment, labor, office space, etc. The actual or imputed 
value of intellectual property such as patent rights, data rights, 
trade secrets, etc., are not acceptable as sources for the Recipient 
contribution. The Government's cost share should fully reflect the 
total cost of the cash and non-cash contributions. With respect to the 
non-cash contribution, a fully burdened cost estimate of personnel, 
facilities, and other expenses should be utilized. It is recognized 
that this will be an estimate in some cases, but the cost principles in 
Section 9091-5 of the NASA Financial Management Manual should be 
adhered to.
    (7) Recipients shall not be paid a profit under cooperative 
agreements. Profit may be paid by the Recipient to subcontractors, if 
the subcontractor is not part of the offering team and the subcontract 
is an arms-length relationship.
    (8) The Recipient's resource share of the cooperative agreement may 
be allocated as part of its IR&D program.
    (9) The CAN must provide a description of the non-cash Government 
contribution (personnel, equipment, facilities, etc.) as part of the 
Government's contribution to the cooperative agreement in addition to 
funding. The offeror may propose that additional non-cash Government 
resources be provided under two conditions. First, the offeror is 
responsible for verifying the availability of the resources and their 
suitability for their intended purpose and, second, those resources are 
part of the Government contribution (which must be matched by the 
Recipient) and paid for directly by the awarding organization.
    (d) Consortia as recipients. (1) The use of consortia as Recipients 
for cooperative agreements is encouraged. Consortia will tend to bring 
to a cooperative agreement a broader range of capabilities and 
resources. A consortium is a group of organizations that enter into an 
agreement to collaborate for the purposes of the cooperative agreement 
with NASA. The agreement to collaborate can take the form of a legal 
entity such as a partnership or joint venture but it is not necessary 
that such an entity be created. A consortium may be made up of firms 
which normally compete for commercial or Government business or may be 
made up of firms which perform complementary functions in a given 
industry. The inclusion of non-profit or educational institutions, 
small businesses, or small disadvantaged businesses in the consortium 
could be particularly valuable in ensuring that the results of the 
consortium's activities are disseminated.
    (2) Key to the success of the cooperative agreement with a 
consortium is the consortium's Articles of Collaboration, which is a 
definitive description of the roles and responsibilities of the 
consortium's members. It should also address to the extent appropriate: 
commitments of financial, personnel, facilities and other resources, a 
detailed milestone chart of consortium activities, accounting 
requirements, subcontracting procedures, disputes, term of the 
agreement, insurance and liability issues, internal and external 
reporting requirements, management structure of the consortium, 
obligations of organizations withdrawing from the consortia, allocation 
of data and patent rights among the consortia members, agreements, if 
any, to share existing technology and data, the firm which is 
responsible for the completion of the consortium's responsibilities 
under the cooperative agreement and has the authority to commit the 
consortium and receive payments from NASA, employee policy issues, etc.
    (3) An outline of the Articles of Collaboration should be required 
as part of the proposal and evaluated during the source selection 
process.
    (e) Metric system of measurement. The Metric Conversion Act, as 
amended by the Omnibus Trade and Competitiveness Act (15 U.S.C. 205) 
declares that the metric system is the preferred measurement system for 
U.S. trade and commerce. NASA's policy with respect to the metric 
measurement system is stated in NPD 8010.2, Use of the Metric System of 
Measurement in NASA Programs.
    (f) The provisions set forth in Sec. 1274.901 are generally 
considered appropriate for agreements not exceeding 3 years and/or a 
Government cash contribution not exceeding $20M. For cooperative 
agreements expected to be longer than 3 years and/or involve a 
Government cash contribution exceeding $20M, consideration should be 
given to provisions which place additional restrictions on the 
recipient in terms of validating performance and accounting for funds 
expended.


Sec. 1274.203  Intellectual property.

    (a) A cooperative agreement covers the disposition of rights to 
intellectual property between NASA and the Recipient. If the Recipient 
is a consortium or partnership, rights flowing between multiple 
organizations in a consortium must be negotiated separately and 
formally documented, preferably in the Articles of Collaboration.
    (b) Patent rights clauses are required by statute and regulation. 
The clauses exist for Recipients of the Agreement whether they are:
    (1) Other than small business or nonprofit organizations (generally 
referred to as large businesses) or
    (2) Small businesses or nonprofit organizations.
    (c) There are five situations in which inventions may arise under a 
cooperative agreement: Recipient inventions, subcontractor inventions, 
NASA inventions, NASA support contractor inventions, and joint 
inventions with Recipient.
    (d)(1) Recipient inventions.
    (i) A Recipient, if a large business, is subject to Section 305 of 
the National Aeronautics and Space Act of 1958 (42 U.S.C. 2457) 
relating to property rights in inventions. The term ``invention'' 
includes any invention, discovery, improvement, or innovation. Title to 
an invention made under a cooperative agreement by a large business 
Recipient

[[Page 50371]]

initially vests with NASA. The Recipient may request a waiver under the 
NASA Patent Waiver Regulations to obtain title to inventions made under 
the Agreement. Such a request may be made in advance of the Agreement 
(or 30 days thereafter) for all inventions made under the Agreement. 
Alternatively, requests may be made on a case by case basis any time an 
individual invention is made. Such waivers are liberally and 
expeditiously granted after review by NASA's Invention and Contribution 
Board and approval by NASA's General Counsel. When a waiver is granted, 
any inventions made in the performance of work under the Agreement are 
subject to certain reporting, election and filing requirements, a 
royalty-free license to the Government, march-in rights, and certain 
other reservations.
    (ii) A Recipient, if a small business or nonprofit organization, 
may elect to retain title to its inventions. The term ``nonprofit 
organization'' is defined in 35 U.S.C. 201(i) and includes universities 
and other institutions of higher education or an organization of the 
type described in Section 501(c)(3) of the Internal Revenue Code (26 
U.S.C.). The Government obtains an irrevocable, nonexclusive, royalty-
free license.
    (2) Subcontractor inventions.
    (i) Large business. If a Recipient enters a subcontract (or similar 
arrangement) with a large business organization for experimental, 
developmental, research, design or engineering work in support of the 
Agreement to be done in the United States, its possessions, or Puerto 
Rico, section 305 of the Space Act applies. The clause applicable to 
large business organizations is to be used (suitably modified to 
identify the parties) in any subcontract. The subcontractor may request 
a waiver under the NASA Patent Waiver Regulations to obtain rights to 
inventions made under the subcontract just as a large business 
Recipient can (see paragraph (d)(1)(i) of this section). It is strongly 
recommended that a prospective large business subcontractor contact the 
NASA installation Patent Counsel or Intellectual Property Counsel to 
assure that the right procedures are followed. Just like the Recipient, 
any inventions made in the performance of work under the Agreement are 
subject to certain reporting, election and filing requirements, a 
royalty-free license to the Government, march-in rights, and certain 
other reservations.
    (ii) Non-profit organization or small business. In the event the 
Recipient enters into a subcontract (or similar arrangement) with a 
domestic nonprofit organization or a small business firm for 
experimental, developmental, or research work to be performed under the 
Agreement, the requirements of 35 U.S.C. 200 et seq. regarding ``Patent 
Rights in Inventions Made With Federal Assistance,'' apply. The 
subcontractor has the first option to elect title to any inventions 
made in the performance of work under the Agreement, subject to 
specific reporting, election and filing requirements, a royalty-free 
license to the Government, march-in rights, and certain other 
reservations that are specifically set forth.
    (iii) Work outside the United States. If the Recipient subcontracts 
for work to be done outside the United States, its possessions or 
Puerto Rico, the NASA installation Patent Counsel or Intellectual 
Property Counsel should be contacted for the proper patent rights 
clause to use and the procedures to follow.
    (iv) Notwithstanding paragraphs (d)(2)(i), (ii) and (iii), and in 
recognition of the Recipient's substantial contribution, the Recipient 
is authorized, subject to rights of NASA set forth elsewhere in the 
Agreement, to:
    (A) Acquire by negotiation and mutual agreement rights to a 
subcontractor's subject inventions as the Recipient may deem necessary, 
or
    (B) If unable to reach agreement pursuant to paragraph 
(d)(2)(iv)(A) of this section, request that NASA invoke exceptional 
circumstances as necessary pursuant to 37 CFR 401.3(a)(2) if the 
prospective subcontractor is a small business firm or nonprofit 
organization, or for all other organizations, request that such rights 
for the Recipient be included as an additional reservation in a waiver 
granted pursuant to 14 CFR 1245.1. The exercise of this exception does 
not change the flow down of the applicable patent rights clause to 
subcontractors. Applicable laws and regulations require that title to 
inventions made under a subcontract must initially reside in either the 
subcontractor or NASA, not the Recipient. This exception does not 
change that. The exception does authorize the Recipient to negotiate 
and reach mutual agreement with the subcontractor for the grant-back of 
rights. Such grant-back could be an option for an exclusive license or 
an assignment, depending on the circumstances.
    (3) NASA inventions. NASA will use reasonable efforts to report 
inventions made by its employees as a consequence of, or which bear a 
direct relation to, the performance of specified NASA activities under 
an Agreement. Upon timely request, NASA will use its best efforts to 
grant Recipient first option to acquire either an exclusive or 
partially-exclusive, revocable, royalty-bearing license, on terms to be 
negotiated, for any patent applications and patents covering such 
inventions. This exclusive or partially-exclusive license to the 
Recipient will be subject to the retention of rights by or on behalf of 
the Government for Government purposes.
    (4) NASA support contractor inventions. It is preferred that NASA 
support contractors be excluded from performing any of NASA's 
responsibilities under the Agreement since the rights obtained by a 
NASA support contractor could work against the rights needed by the 
Recipient. In the event NASA support contractors are tasked to work 
under the Agreement and inventions are made by support contractor 
employees, the support contractor will normally retain title to its 
employee inventions in accordance with 35 U.S.C. 202, 14 CFR part 1245, 
and Executive Order 12591. In the event the recipient decides not to 
pursue right to title in any such invention and NASA obtains title to 
such inventions, upon timely request, NASA will use its best efforts to 
grant Recipient first option to acquire either an exclusive or 
partially exclusive, revocable, royalty-bearing license, upon terms to 
be negotiated, for any patent applications and patents covering such 
inventions. This exclusive or partially-exclusive license to the 
Recipient will be subject to the retention of rights by or on behalf of 
the Government for Government purposes.
    (5) Joint inventions. (i) NASA and the Recipient agree to use 
reasonable efforts to identify and report to each other any inventions 
made jointly between NASA employees (or employees of NASA support 
contractors) and employees of Recipient. For large businesses, the 
Associate General Counsel (Intellectual Property) may agree that the 
United States will refrain, for a specified period, from exercising its 
undivided interest in a manner inconsistent with Recipient's commercial 
interest. For small business firms and nonprofit organizations, the 
Associate General Counsel (Intellectual Property) may agree to assign 
or transfer whatever rights NASA may acquire in a subject invention 
from its employee to the Recipient as authorized by 35 U.S.C. 202(e). 
The grant officer negotiating the Agreement with small business firms 
and nonprofit organizations can agree, up front, that NASA will assign 
whatever rights it may acquire in a subject invention from its employee 
to the small business firm or nonprofit organization. Requests under 
this

[[Page 50372]]

paragraph shall be made through the Center Patent Counsel.
    (ii) NASA support contractors may be joint inventors. If a NASA 
support contractor employee is a joint inventor with a NASA employee, 
the same provisions apply as those for NASA Support Contractor 
Inventions. The NASA support contractor will retain or obtain 
nonexclusive licenses to those inventions in which NASA obtains title. 
If a NASA support contractor employee is a joint inventor with a 
Recipient employee, the NASA support contractor and Recipient will 
become joint owners of those inventions in which they have elected to 
retain title or requested and have been granted waiver of title. Where 
the NASA support contractor has not elected to retain title or has not 
been granted waiver of title, NASA will jointly own the invention with 
the Recipient.
    (e) Licenses to Recipient(s). (1) Any exclusive or partially 
exclusive commercial licenses are to be royalty-bearing consistent with 
Government-wide policy in licensing its inventions. It also provides an 
opportunity for royalty-sharing with the employee-inventor, consistent 
with Government-wide policy under the Federal Technology Transfer Act.
    (2) Upon application in compliance with 37 CFR Part 404--Licensing 
of Government Owned Inventions, all Recipients shall be granted a 
revocable, nonexclusive, royalty-free license in each patent 
application filed in any country on a subject invention and any 
resulting patent in which the Government obtains title. Because 
cooperative agreements are cost sharing cooperative arrangements with a 
purpose of benefiting the public by improving the competitiveness of 
the Recipient and the Government receives an irrevocable, nonexclusive, 
royalty-free license in each Recipient subject invention, it is only 
equitable that the Recipient receive, at a minimum, a revocable, 
nonexclusive, royalty-free license in NASA inventions and NASA 
contractor inventions where NASA has acquired title.
    (3) Notice requirements. Once a Recipient has exercised its option 
to apply for an exclusive or partially exclusive license, a notice, 
identifying the invention and the Recipient, is published in the 
Federal Register, providing the public opportunity for filing written 
objections for 60 days.
    (f) Preference for United States manufacture. Despite any other 
provision, the Recipient agrees that any products embodying subject 
inventions or produced through the use of subject inventions shall be 
manufactured substantially in the United States. The intent of this 
provision is to support manufacturing jobs in the United States 
regardless of the status of the Recipient as a domestic or foreign 
controlled company. However, in individual cases, the requirement to 
manufacture substantially in the United States, may be waived by the 
Associate Administrator for Procurement (Code HS) upon a showing by the 
Recipient that under the circumstances domestic manufacture is not 
commercially feasible.
    (g) Space Act Agreements. Invention and patent rights in 
cooperative agreements must comply with statutory and regulatory 
provisions. Where circumstances permit, a Space Act Agreement is 
available as an alternative instrument which can be more flexible in 
the area of invention and patent rights.
    (h) Data rights. Data rights provisions can and should be tailored 
to best achieve the needs and objectives of the respective parties 
concerned.
    (1) The data rights clause at Sec. 1274.905 assumes a substantially 
equal cost sharing relationship where collaborative research, 
experimental, developmental, engineering, demonstration, or design 
activities are to be carried out, such that it is likely that 
``proprietary'' information will be developed and/or exchanged under 
the agreement. If cost sharing is unequal or no extensive research, 
experimental, developmental, engineering, demonstration, or design 
activities are likely, a different set of clauses may be appropriate.
    (2) The primary question that must be answered when developing data 
clauses is what does each party need or intend to do with the data 
developed under the agreement. Accordingly, the data rights clauses may 
be tailored to fit the circumstances. Where conflicting goals of the 
parties result in incompatible data provisions, grant officers for the 
Government must recognize that private companies entering into 
cooperative agreements bring resources to that relationship and must be 
allowed to reap an appropriate benefit for the expenditure of those 
resources. However, since serving a public purpose is a major objective 
of a cooperative agreement, care must be exercised to ensure the 
Recipient is not established as a long term sole source supplier of an 
item or service and is not in a position to take unfair advantage of 
the results of the cooperative agreement. Therefore, a reasonable time 
period (depending on the technology, two to five years after production 
of the data) may be established after which the data first produced by 
the Recipient in the performance of the agreement will be made public.
    (3) Data can be generated from different sources and can have 
various restrictions placed on its dissemination. Recipient data 
furnished to NASA can exist prior to, or be produced outside of, the 
agreement or be produced under the agreement. NASA can also produce 
data in carrying out its responsibilities under the agreement. Each of 
these areas need to be covered.
    (4) For data, including software, first produced by the Recipient 
under the agreement, the Recipient may assert copyright. Data exchanged 
with a notice showing that the data is protected by copyright must 
include appropriate licenses in order for NASA to use the data as 
needed.
    (5) Recognizing that the dissemination of the results of NASA's 
activities is a primary objective of a cooperative agreement, the 
parties should specifically delineate what results will be published 
and under what conditions. This should be set forth in the clause of 
the cooperative agreement entitled ``Publication and Reports.'' Any 
such agreement on the publication of results should be stated to take 
precedence over any other clause in the cooperative agreement.
    (6) In accordance with section 303(b) of the Space Act, any data 
first produced by NASA under the agreement which embodies trade secrets 
or financial information that would be privileged or confidential if it 
had been obtained from a private participant, will be marked with an 
appropriate legend and maintained in confidence for an agreed to period 
of up to five years (the maximum allowed by law). This does not apply 
to data other than that for which there has been agreement regarding 
publication or distribution. The period of time during which data first 
produced by NASA is maintained in confidence should be consistent with 
the period of time determined in accordance with paragraph (h)(2) of 
this section, before which data first produced by the Recipient will be 
made public. Also, NASA itself may use the marked data (under suitable 
protective conditions) for agreed-to purposes.


Sec. 1274.204  Evaluation and selection.

    (a) A single technical evaluation factor is typically used for 
CANs. That evaluation factor should be one of the following: providing 
research and development or technology transfer, enhancing U.S. 
competitiveness, or developing a capability among U.S. firms. Award to 
foreign firms is not precluded if the evaluation factor is

[[Page 50373]]

satisfied. Subfactors could include such things as fostering U.S. 
leadership, potential to advance technologies anticipated to enhance 
U.S. competitiveness, timeliness of proposed accomplishments, private 
sector commitment to commercialization, identification of specific 
potential commercial markets, appropriateness of business risk, 
potential for broad impact on the U.S. technology and knowledge base, 
level of commitment (contribution of private resources to the project), 
appropriateness of team member participation and relationships, (this 
subfactor should include consideration of the participation of an 
appropriate mix of small business, small disadvantaged business, and 
women-owned small business concerns, as well as non-profits and 
educational institutions, including historically black colleges and 
universities and minority institutions) appropriateness of management 
planning, relevant experience, qualifications and depth of management 
and technical staff, quality and appropriateness of resources committed 
to the project, performance bench marks, technical approach, business 
approach/resource sharing, past performance, the articles of 
collaboration, etc.
    (b) Technical evaluation. (1) Competitive technical proposal 
information shall be protected in accordance with 48 CFR (FAR) 15.207, 
Handling Proposals and Information. Unsolicited proposals shall be 
protected in accordance with 48 CFR (FAR) 15.608, Prohibitions, and 48 
CFR (FAR) 15.609, Limited Use of Data.
    (i) Selecting Officials and Grant/Contracting Officers are 
responsible for protecting sensitive information on the award of a 
Grant or Cooperative Agreement and for determining who is authorized to 
receive such information. Sensitive information includes: information 
contained in proposals; information prepared for NASA's evaluation of 
proposals; the rankings of proposals for an award; reports and 
evaluations of source selection panels, boards, or advisory councils; 
and other information deemed sensitive by the Selecting Official or by 
the Grant/Contracting Officer.
    (ii) No sensitive information shall be disclosed unless the 
Selecting Official or the Grant/Contracting Officer has approved 
disclosure based upon an unequivocal ``need-to-know'' and the 
individual receiving the information has signed a Non-Disclosure 
Certificate (Exhibit E to subpart A of 14 CFR part 1260). All attendees 
at formal source selection presentations and briefings shall be 
required to sign an Attendance Roster. The attendance rosters and 
certificates shall be maintained in official files for a minimum of six 
months after award.
    (iii) The improper disclosure of sensitive information could result 
in criminal prosecution or an adverse action.
    (2) The technical officer will evaluate proposals in accordance 
with the criteria in the CAN. Proposals selected for award will be 
supported by documentation as described in paragraph (c)(1) of this 
section. When evaluation results in a proposal not being selected, the 
proposer will be notified in accordance with the CAN.
    (3) The technical evaluation of proposals may include peer reviews. 
Since the business sense of a cooperative agreement proposal is 
critical to its success, NASA should reserve the right to utilize 
appropriate outside evaluators to assist in the evaluation of such 
proposal elements as the business base projections, the market for 
proposed products, and/or the impact of anticipated product price 
reductions. The use of outside evaluators shall be approved in 
accordance with 48 CFR (NFS) 1815.207-70(b). A cover sheet with the 
following legend shall be affixed to data provided to outside 
evaluators:

Government Notice for Handling Proposals

    This proposal shall be used and disclosed for evaluation 
purposes only, and a copy of this Government notice shall be applied 
to any reproduction or abstract thereof. Any authorized restrictive 
notices which the submitter places on this proposal shall also be 
strictly complied with.

    (4) Unsolicited proposals. Evaluation of unsolicited proposals must 
consider whether: the subject of the proposal is available to NASA from 
another source without restriction; the proposal closely resembles a 
pending competitive acquisition; and the research proposed demonstrates 
an innovative and unique method, approach, or concept. Organizations 
submitting unaccepted proposals will be notified in writing.
    (c) Documentation requirements. For proposals selected for award, 
the technical officer will prepare and furnish to the grant officer the 
following documentation:
    (1) For a competitively selected proposal, a signed selection 
statement and technical evaluation based on the evaluation criteria 
stated in the solicitation.
    (2) For an unsolicited proposal, a justification for acceptance of 
an unsolicited proposal (JAUP) prepared by the cognizant technical 
office. The JAUP shall be submitted for the approval of the grant 
officer after review and concurrence at a level above the technical 
officer. The evaluator shall consider the following factors, in 
addition to any others appropriate for the particular proposal:
    (i) Unique and innovative methods, approaches or concepts 
demonstrated by the proposal.
    (ii) Overall scientific or technical merits of the proposal.
    (iii) The offeror's capabilities, related
    experience, facilities, techniques, or unique combinations of these 
which are integral factors for achieving the proposal objectives.
    (iv) The qualifications, capabilities, and experience of the 
proposed key personnel who are critical in achieving the proposal 
objectives.
    (v) Current, open solicitations under which the unsolicited 
proposal could be evaluated.
    (d) Cost evaluation. (1) The grant officer and technical team will 
determine whether the overall proposed cost of the project is 
reasonable and that the Recipient's contribution is valid, verifiable, 
and available. Commitments should be obtained and verified to the 
extent practical from the offeror or members of the consortia that the 
proposed contributions can and will be made as specified in the 
proposal or statement of work.
    (i) If the Recipient's verified share on a cooperative agreement 
equals or exceeds 50 percent of the total cost of the agreement and the 
total value of the agreement is less than $5 million, the cost 
evaluation of the offeror's proposal should focus on the overall 
reasonableness and timing of the proposer's contribution. Cost or 
pricing data should not be required and information other than cost or 
pricing data (defined in 48 CFR (FAR) 15.403-3) should not normally be 
required.
    (ii) If the Recipient's share is projected to be less than 50 
percent or the total value of the agreement is more than $5 million, a 
more in-depth analysis of the proposed costs should be undertaken. Only 
information other than cost or pricing data should be required. An 
analysis consistent with 48 CFR (FAR) 15.404-1 through 15.404-2 should 
be performed.
    (2) As part of the evaluation of the cost proposal, the source of 
the recipient's contribution should be determined. Each of the cost 
elements contributed by the recipient and their amounts should be 
identified. If the contribution will consist at least in part of IR&D, 
the extent to which the IR&D may be recoverable from Government awards 
should be established. This will involve using the estimated Government

[[Page 50374]]

participation rate of the recipient's General and Administrative 
indirect cost base for the period of the cooperative agreement. An 
analysis consistent with 48 CFR (FAR) 15.404-1 and 15.404-2 should be 
performed.
    (e) If the cooperative agreement is to be awarded to a consortium, 
a completed, formally executed Articles of Collaboration is required 
prior to award.
    (f) Printing, binding, and duplicating. Proposals for effort which 
involve printing, binding, and duplicating in excess of 25,000 pages 
are subject to the regulations of the Congressional Joint Committee on 
Printing. The technical office will refer such proposals to the 
Installation Central Printing Management Officer (ICPMO) to ensure 
compliance with NPD 1490.1. The grant officer will be advised in 
writing of the results of the ICPMO review.


Sec. 1274.205  Award procedures.

    (a) General. Multiple year cooperative agreements are encouraged, 
but normally they should not extend beyond two years.
    (b) Award above proposed amount. Awards of cooperative agreements 
in response to competitive solicitations will not result in providing 
more NASA funds or resources than was anticipated in the Recipient's 
proposal. If additional funds or resources are deemed necessary, they 
will be provided by the Recipient and the Government cost share 
percentage will be adjusted downward.
    (c) Changes to cooperative agreements. Cost growth or in-scope 
changes shall not increase the amount of NASA's contribution. 
Additional costs which arise during the performance of the cooperative 
agreement are the responsibility of the Recipient. Funding for work 
required beyond the scope of the cooperative agreement must be sought 
through the submission of a proposal which will be treated as an 
unsolicited proposal.
    (d) Bilateral award. All cooperative agreements awarded under this 
part will be awarded on a bilateral basis.
    (e) Certifications and representations. (1) Unless prohibited by 
statute or codified regulation, Recipients will be encouraged to submit 
certifications and representations required by statute, executive 
order, or regulation on an annual basis, if the Recipients have ongoing 
and continuing relationships with the agency. Annual certifications and 
representations shall be signed by responsible officials with the 
authority to ensure Recipients' compliance with the pertinent 
requirements.
    (2) Civil rights requirements--nondiscrimination in certain 
Federally-funded programs. Recipients must furnish assurances of 
compliance with civil rights statutes specified in 14 CFR parts 1250 
through 1252. Such assurances are not required for each cooperative 
agreement, if they have previously been furnished and remain current 
and accurate. Certifications to NASA are normally made on NASA Form 
1206, which may be obtained from the grant officer. Upon acceptance, 
the grant officer will forward assurances to the NASA Office of Equal 
Opportunity Programs for recording and retention purposes.
    (3) NASA cooperative agreements are subject to the provisions of 14 
CFR part 1265, Government-wide Debarment and Suspension 
(Nonprocurement) and Government-wide requirements for Drug-Free 
Workplace (Grants), unless excepted by Secs. 1265.110 and 1265.610.
    (4) Lobbying Certification. A Lobbying Certification in accordance 
with 14 CFR part 1271 will be obtained prior to award.
    (f) Indemnification under Public Law 85-804 is not authorized for 
cooperative agreements.
    (g) The standard operating procedures for the Office of Public 
Affairs will be followed when notifying Congress and releasing 
information to the news media about awards. Grant/Contracting Officers 
must approve any exceptions to this policy.


Sec. 1274.206  Document format and numbering.

    (a) Formats. Grant officers are authorized to use the format set 
forth in Exhibit B to subpart A of 14 CFR part 1260, with minimum 
modification, as the standard cooperative agreement cover page for the 
award of all cooperative agreements.
    (b) Cooperative agreement numbering prior to Integrated Financial 
Management Project (IFMP) implementation shall conform to 48 CFR (NFS) 
1804.7102-3, except that a NCC prefix will be used in lieu of the NAS 
prefix.
    (c) There will be a phase-in term for Center implementation of the 
IFMP. For Centers using IFMP Performance Purchasing, the following 
cooperative agreement numbering system shall be used:
    (1) Document Type for cooperative agreements. Cooperative 
agreements will use the prefix CO.
    (2) Agency Identifier. The Agency identifier NAS shall follow the 
document number.
    (3) Center Smart Codes. The Center identifier shall follow the 
document type:

------------------------------------------------------------------------
                 Installation                          Smart code
------------------------------------------------------------------------
Ames Research Center.........................  A
Dryden Flight Research Center................  D
Glen Research Center.........................  C
Goddard Space Flight Center..................  G
Headquarters.................................  H
Johnson Space Center.........................  J
Kennedy Space Center.........................  K
Langley Research Center......................  L
Marshall Space Flight Center.................  M
NASA Management Office-JPL...................  P
Stennis Space Center.........................  S
------------------------------------------------------------------------

    (4) Fiscal Year. The fiscal year shall be represented as two 
digits.
    (5) Procurement Code. Cooperative Agreements will be identified 
using ``A'' as the procurement code.
    (6) Serial Numbers. Installations shall number cooperative 
agreements with commercial firms serially by fiscal year, within the 
same number series used for grants and cooperative agreements with non-
profit organizations. The serial number shall be six digits commencing 
with ``000001'' and continuing in succession.


Sec. 1274.207  Distribution of cooperative agreements.

    Copies of cooperative agreements and modifications will be provided 
to: payment office, technical officer, administrative grant officer 
when delegation has been made, NASA Center for Aerospace Information 
(CASI), Attn: Document Processing Section, 7121 Standard Drive, 
Hanover, MD 21076, and any other appropriate recipient. Copies of the 
statement of work, contained in the Recipient's proposal and accepted 
by NASA, will be provided to the administrative grant officer and CASI. 
The cooperative agreement file will contain a record of the addresses 
for distributing agreements and supplements.

Subpart C--Administration


Sec. 1274.301  Delegation of administration.

    Normally, cooperative agreements will be administered by the 
awarding activity. NASA Form 1678, NASA Technical Officer Delegation 
for Cooperative Agreements with Commercial Firms, will be used to 
delegate responsibilities to the NASA Technical Officer.


Sec. 1274.302  Transfers, novations, and change of name agreements.

    (a) Transfer of cooperative agreements. Novation is the only means 
by which a cooperative agreement may

[[Page 50375]]

be transferred from one Recipient to another.
    (b) Novation and change of name. All novation agreements and change 
of name agreements of the Recipient, prior to execution, shall be 
reviewed by NASA legal counsel for legal sufficiency prior to approval.

Subpart D--Government Property


Sec. 1274.401  Government property.

    The accomplishment of a cooperative agreement may require the 
purchase of equipment for a wide range of purposes. If this equipment 
is purchased with Government funds, i.e., as part of the Government 
contribution to the cooperative agreement, it becomes Government 
property and must be disposed of in accordance with 48 CFR (FAR) part 
45 at the conclusion of the cooperative agreement. In some cases, this 
may meet the needs of the parties. If, however, the Recipient may need 
the equipment to continue commercial efforts following the cooperative 
agreement, it should be purchased by the Recipient and included as a 
non-cash contribution of the Recipient. In this way, it is not 
procured, not even in part, with Government funds and the Government 
acquires no ownership interest. Procurement by the Recipient may be 
before or during the performance of the cooperative agreement.

Subpart E--Procurement Standards


Sec. 1274.501  Subcontracts.

    Recipients (individual firms or consortia) are not authorized to 
issue grants or cooperative agreements to subrecipients. All contracts, 
including small purchases, awarded by Recipients and their contractors 
shall contain the procurement provisions of appendix A to this part, as 
applicable and may be subject to approval requirements cited in 
Sec. 1274.925.

Subpart F--Reports and Records


Sec. 1274.601  Retention and access requirements for records.

    (a) This subpart sets forth requirements for record retention and 
access to records for awards to Recipients.
    (b) Financial records, supporting documents, statistical records, 
and all other records pertinent to an award shall be retained for a 
period of three years from the date of submission of the final invoice. 
The only exceptions are the following:
    (1) If any litigation, claim, or audit is started before the 
expiration of the 3-year period, the records shall be retained until 
all litigation, claims or audit findings involving the records have 
been resolved and final action taken.
    (2) Records for real property and equipment acquired with Federal 
funds shall be retained for 3 years after final disposition.
    (3) When records are transferred to or maintained by NASA, the 3-
year retention requirement is not applicable to the Recipient.
    (4) Indirect cost rate proposals, cost allocations plans, etc. as 
specified in paragraph (g) of this section.
    (c) Copies of original records may be substituted for the original 
records if authorized by NASA.
    (d) NASA shall request transfer of certain records to its custody 
from Recipients when it determines that the records possess long term 
retention value. However, in order to avoid duplicate record keeping, 
NASA may make arrangements for Recipients to retain any records that 
are continuously needed for joint use.
    (e) NASA, the Inspector General, Comptroller General of the United 
States, or any of their duly authorized representatives, have the right 
of timely and unrestricted access to any books, documents, papers, or 
other records of Recipients that are pertinent to the awards, in order 
to make audits, examinations, excerpts, transcripts and copies of such 
documents. This right also includes timely and reasonable access to a 
Recipient's personnel for the purpose of interview and discussion 
related to such documents. The rights of access in this paragraph are 
not limited to the required retention period, but shall last as long as 
records are retained.
    (f) Unless required by statute, NASA shall not place restrictions 
on Recipients that limit public access to the records of Recipients 
that are pertinent to an award, except when NASA can demonstrate that 
such records shall be kept confidential and would have been exempted 
from disclosure pursuant to the Freedom of Information Act (5 U.S.C. 
552) if the records had belonged to NASA.
    (g) Indirect cost rate proposals, cost allocations plans, etc. This 
paragraph applies to the following types of documents, and their 
supporting records: indirect cost rate computations or proposals, cost 
allocation plans, and any similar accounting computations of the rate 
at which a particular group of costs is chargeable (such as computer 
usage chargeback rates or composite fringe benefit rates).
    (1) If submitted for negotiation. If the Recipient submits to NASA 
or the subrecipient submits to the Recipient the proposal, plan, or 
other computation to form the basis for negotiation of the rate, then 
the 3-year retention period for its supporting records starts on the 
date of such submission.
    (2) If not submitted for negotiation. If the Recipient is not 
required to submit to NASA or the subrecipient is not required to 
submit to the Recipient the proposal, plan, or other computation for 
negotiation purposes, then the 3-year retention period for the 
proposal, plan, or other computation and its supporting records starts 
at the end of the fiscal year (or other accounting period) covered by 
the proposal, plan, or other computation.

Subpart G--Suspension and Termination


Sec. 1274.701  Suspension or termination.

    A cooperative agreement provides both NASA and the Recipient the 
ability to terminate the agreement if it is in their best interests to 
do so. For example, NASA may terminate the agreement if the Recipient 
is not making anticipated technical progress, if the Recipient 
materially fails to comply with the terms of the agreement, if the 
Recipient materially changes the objective of the agreement, or if 
appropriated funds are not available to support the program. Similarly, 
the Recipient may terminate the agreement if, for example, technical 
progress is not being made, if the firms are shifting their technical 
emphasis, or if other technological advances have made the effort 
obsolete. NASA or the Recipient may also suspend the cooperative 
agreement for a short period of time if an assessment needs to be made 
as to whether the agreement should be terminated.

Subpart H--After-the-Award Requirements


Sec. 1274.801  Purpose.

    Sections 1274.802 and 1274.803 contain closeout procedures and 
other procedures for subsequent disallowances and adjustments.


Sec. 1274.802  Closeout procedures.

    (a) Recipients shall submit, within 90 calendar days after the date 
of completion of the cooperative agreement, all financial, performance, 
and other reports as required by the terms and conditions of the award. 
Extensions may be approved when requested by the Recipient.
    (b) The Recipient shall account for any real and personal property 
acquired with Federal funds or received from the Federal Government in 
accordance with subpart D of this part.

[[Page 50376]]

Sec. 1274.803  Subsequent adjustments and continuing responsibilities.

    The closeout of an award does not affect any of the following:
    (a) Audit requirements in Sec. 1274.932.
    (b) Property management requirements in subpart D of this part.
    (c) Records retention as required in Sec. 1274.601.

Subpart I--Provisions and Special Conditions


Sec. 1274.901  Provisions and special conditions.

    The provisions set forth in this subpart are to be incorporated in 
and made a part of all cooperative agreements. The provisions at 
Secs. 1274.902 through 1274.909 and the provision at 1274.933 are to be 
incorporated in full text substantially as stated in this subpart. The 
provisions at Secs. 1274.910 through 1274.932 and Sec. 1274.934 will be 
incorporated by reference in an enclosure to each cooperative 
agreement. For inclusion of provisions in subcontracts, see subpart E, 
Procurement Standards, of this part.


Sec. 1274.902  Purpose.

Purpose (Date)

    The purpose of this cooperative agreement is to conduct a shared 
resource project that will lead to ____________. This cooperative 
agreement will advance the technology developments and research 
which have been performed on ____________. The specific objective is 
to ____________. This work will culminate in ____________.
[End of provision]


Sec. 1274.903  Responsibilities.

Responsibilities (Date)

    (a) This cooperative agreement will include substantial
    NASA participation during performance of the effort. NASA and 
the Recipient agree to the following Responsibilities, a statement 
of cooperative interactions to occur during the performance of this 
effort. NASA and the Recipient shall exert all reasonable efforts to 
fulfill the responsibilities stated below.
    (b) NASA Responsibilities. The following NASA responsibilities 
are hereby set forth with anticipated start and ending dates, as 
appropriate:

Responsibility        Start    End

    (c) Recipient Responsibilities. The Recipient shall be 
responsible for particular aspects of project performance as set 
forth in the technical proposal dated ____________, attached hereto 
(or Statement of Work dated ____________, attached hereto.). The 
following responsibilities are hereby set forth with anticipated 
start and ending dates, as appropriate:

Responsibility        Start    End

    (d) Since NASA contractors may obtain certain intellectual 
property rights arising from work for NASA in support of this 
agreement, NASA will inform Recipient whenever NASA intends to use 
NASA contractors to perform technical engineering services in 
support of this agreement.

[End of provision]


Sec. 1274.904  Resource sharing requirements.

Resource Sharing Requirements (Date)

    (a) NASA and the Recipient will share in providing the resources 
necessary to perform the agreement. NASA funding and non-cash 
contributions (personnel, equipment, facilities, etc.) and the 
dollar value of the Recipient's cash and/or non-cash contribution 
will be on a ____ (NASA) ____ (Recipient) basis. Criteria and 
procedures for the allowability and allocability of cash and non-
cash contributions shall be governed by Section 23, ``Cost Sharing 
or Matching,'' of OMB Circular A-110. The ``applicable federal cost 
principles'' cited in OMB Circular A-110 shall be determined in 
accordance with 1274.919.
    (d) The Recipient's share shall not be charged to the Government 
under this agreement or under any other contract, grant, or 
cooperative agreement, except to the extent that the Recipient's 
contribution may be allowable IR&D costs pursuant to 48 CFR (NFS) 
1831.205-18.

[End of provision]


Sec. 1274.905  Rights in Data.

    (As noted in Sec. 1274.203(h)(1), the following provision assumes a 
substantially equal cost sharing relationship where collaborative 
research, experimental, developmental, engineering, demonstration, or 
design activities are to be carried out, such that it is likely that 
``proprietary'' information will be developed and/or exchanged under 
the agreement. If cost sharing is unequal or no extensive research, 
experimental, developmental, engineering, demonstration, or design 
activities are likely, a different set of provisions may be 
appropriate.
    The grant officer is expected to complete and/or select the 
appropriate bracketed language under the provision for those paragraphs 
dealing with data first produced under the cooperative agreement. In 
addition, the grant officer may, in consultation with the Center's 
Patent or Intellectual Property Counsel, tailor the provision to fit 
the particular circumstances of the program and/or the recipient's need 
to protect specific proprietary information.)

Rights in Data (Date)

    (a) Definitions.
    ``Data,'' means recorded information, regardless of form, the 
media on which it may be recorded, or the method of recording. The 
term includes, but is not limited to, data of a scientific or 
technical nature, computer software and documentation thereof, and 
data comprising commercial and financial information.
    (b) Data Categories.
    (1) General: Data exchanged between NASA and Recipient under 
this cooperative agreement will be exchanged without restriction as 
to its disclosure, use or duplication except as otherwise provided 
below in this provision.
    (2) Background Data: In the event it is necessary for Recipient 
to furnish NASA with Data which existed prior to, or produced 
outside of, this cooperative agreement, and such Data embodies trade 
secrets or comprises commercial or financial information which is 
privileged or confidential, and such Data is so identified with a 
suitable notice or legend, the Data will be maintained in confidence 
and disclosed and used by NASA and its contractors (under suitable 
protective conditions) only for the purpose of carrying out NASA's 
responsibilities under this cooperative agreement. Upon completion 
of activities under this agreement, such Data will be disposed of as 
requested by Recipient.
    (3) Data first produced by Recipient: In the event Data first 
produced by Recipient in carrying out Recipient's responsibilities 
under this cooperative agreement is furnished to NASA, and Recipient 
considers such Data to embody trade secrets or to comprise 
commercial or financial information which is privileged or 
confidential, and such Data is so identified with a suitable notice 
or legend, the Data will be maintained in confidence for a period of 
[insert ``two'' to ``five''] years after development of the data and 
be disclosed and used by [``NASA'' or ``the Government,'' as 
appropriate] and its contractors (under suitable protective 
conditions) only for [insert appropriate purpose; for example: 
experimental; evaluation; research; development, etc.] by or on 
behalf of [``NASA'' or ``the Government'' as appropriate] during 
that period. In order that [''NASA'' or the ``Government'', as 
appropriate] and its contractors may exercise the right to use such 
Data for the purposes designated above, NASA, upon request to the 
Recipient, shall have the right to review and request delivery of 
Data first produced by Recipient. Delivery shall be made within a 
time period specified by NASA.
    (4) Data first produced by NASA: As to Data first produced by 
NASA in carrying out NASA's responsibilities under this cooperative 
agreement and which Data would embody trade secrets or would 
comprise commercial or financial information that is privileged or 
confidential if it had been obtained from the Recipient, will be 
marked with an appropriate legend and maintained in confidence for 
an agreed to period of up to (  ) years [INSERT A PERIOD UP TO 5 
YEARS] after development of the information, with the express 
understanding that during the aforesaid period such Data may be 
disclosed and used (under suitable protective conditions) by or on 
behalf of the Government for Government purposes only, and 
thereafter for any purpose whatsoever without restriction on 
disclosure and use. Recipient agrees not to disclose such Data to 
any third party without NASA's written approval until the 
aforementioned restricted period expires.

[[Page 50377]]

    (5) Copyright.
    (i) In the event Data is exchanged with a notice indicating the 
Data is protected under copyright as a published copyrighted work, 
or are deposited for registration as a published work in the U.S. 
Copyright Office, the following paid-up licenses shall apply:
    (A) If it is indicated on the Data that the Data existed prior 
to, or was produced outside of, this agreement, the receiving party 
and others acting on its behalf, may reproduce, distribute, and 
prepare derivative works for the purpose of carrying out the 
receiving party's responsibilities under this cooperative agreement; 
and
    (B) If the furnished Data does not contain the indication of 
paragraph (b)(5)(i)(A) of this section, it will be assumed that the 
Data was first produced under this agreement, and the receiving 
party and others acting on its behalf, shall be granted a paid up, 
nonexclusive, irrevocable, world-wide license for all such Data to 
reproduce, distribute copies to the public, prepare derivative 
works, distribute copies to the public, and perform publicly and 
display publicly, by or on behalf of the receiving party. For Data 
that is computer software, the right to distribute shall be limited 
to potential users in the United States.
    (ii) When claim is made to copyright, the Recipient shall affix 
the applicable copyright notice of 17 U.S.C. 401 or 402 and 
acknowledgment of Government sponsorship to the data when and if the 
data are delivered to the Government.
    (6) Oral and visual information. If information which the 
Recipient considers to embody trade secrets or to comprise 
commercial or financial information which is privileged or 
confidential is disclosed orally or visually to NASA, such 
information must be reduced to tangible, recorded form (i.e., 
converted into Data as defined herein), identified and marked with a 
suitable notice or legend, and furnished to NASA within 10 days 
after such oral or visual disclosure, or NASA shall have no duty to 
limit or restrict, and shall not incur any liability for, any 
disclosure and use of such information.
    (7) Disclaimer of Liability. Notwithstanding the above, NASA 
shall not be restricted in, nor incur any liability for, the 
disclosure and use of:
    (i) Data not identified with a suitable notice or legend as set 
in paragraph (b)(2) of this section; nor
    (ii) Information contained in any Data for which disclosure and 
use is restricted under paragraphs (b)(2) or (3) of this section, if 
such information is or becomes generally known without breach of the 
above, is known to or is generated by NASA independently of carrying 
out responsibilities under this agreement, is rightfully received 
from a third party without restriction, or is included in data which 
Participant has, or is required to furnish to the U.S. Government 
without restriction on disclosure and use.
    (c) Marking of Data. Any Data delivered under this cooperative 
agreement, by NASA or the Recipient, shall be marked with a suitable 
notice or legend indicating the data was generated under this 
cooperative agreement.
    (d) Lower Tier Agreements. The Recipient shall include this 
provision, suitably modified to identify the parties, in all 
subcontracts or lower tier agreements, regardless of tier, for 
experimental, developmental, or research work.

[End of provision]


Sec. 1274.906  Designation of new technology representative and patent 
representative.

Designation of New Technology Representative and Patent Representative 
(Date)

    (a) For purposes of administration of the clause of this 
cooperative agreement entitled ``PATENT RIGHTS--RETENTION BY THE 
CONTRACTOR (LARGE BUSINESS)'' or ``PATENT RIGHTS--RETENTION BY THE 
CONTRACTOR (SMALL BUSINESS)'' the following named representatives 
are hereby designated by the Grant Officer to administer such 
clause:

------------------------------------------------------------------------
               Title                   Office code         Address
------------------------------------------------------------------------
New Technology Representative
Patent Representative
------------------------------------------------------------------------

    (b) Reports of reportable items, and disclosure of subject 
inventions, interim reports, final reports, utilization reports, and 
other reports required by the clause, as well as any correspondence 
with respect to such matters, should be directed to the New 
Technology Representative unless transmitted in response to 
correspondence or request from the Patent Representative. Inquiries 
or requests regarding disposition of rights, election of rights, or 
related matters should be directed to the Patent Representative. 
This clause shall be included in any subcontract hereunder requiring 
``PATENT RIGHTS--RETENTION BY THE CONTRACTOR (LARGE BUSINESS)'' 
clause or ``PATENT RIGHTS--RETENTION BY THE CONTRACTOR (SMALL 
BUSINESS)'' clause, unless otherwise authorized or directed by the 
Grant Officer. The respective responsibilities and authorities of 
the above-named representatives are set forth in 48 CFR (NFS) 
1827.305-70.

[End of provision]


Sec. 1274.907   Disputes.

Disputes (Date)

    (a) In the event that a disagreement arises, representatives of 
the parties shall enter into discussions in good faith and in a 
timely and cooperative manner to seek resolution. If these 
discussions do not result in a satisfactory solution, the aggrieved 
party may seek a decision from the Dispute Resolution Official under 
paragraph (b) of this provision. This request must be presented no 
more than (3) three months after the events giving rise to the 
disagreement have occurred.
    (b) The aggrieved party may submit a written request for a 
decision to the ____________ [Suggest this be the Center Ombudsman], 
who is designated as the Dispute Resolution Official. The written 
request shall include a statement of the relevant facts, a 
discussion of the unresolved issues, and a specification of the 
clarification, relief, or remedy sought.
    A copy of this written request and all accompanying materials 
must be provided to the other party at the same time. The other 
party shall submit a written position on the matters in dispute 
within thirty (30) calendar days after receiving this notification 
that a decision has been requested. The Dispute Resolution Official 
shall conduct a review of the matters in dispute and render a 
decision in writing within thirty (30) calendar days of receipt of 
such written position.

[End of provision]


Sec. 1274.908  Milestone payments.

Milestone Payments (Date)

    (a) By submission of the first invoice, the Recipient is 
certifying that it has an established accounting system which 
complies with generally accepted accounting principles, with the 
requirements of this agreement, and that appropriate arrangements 
have been made for receiving, distributing, and accounting for 
Federal funds received under this agreement.
    (b) Payments will be made upon the following milestones: [The 
schedule for payments may be based upon the Recipient's completion 
of specific tasks, submission of specified reports, or whatever is 
appropriate.]

Date    Payment Milestone        Amount

    (c) Upon submission by the Recipient of invoices in accordance 
with the provisions of the agreement and upon certification by NASA 
of completion of the payable milestone, the grant officer shall 
authorize payment.
    (d) A payment milestone may be successfully completed in advance 
of the date appearing in paragraph (b) of this section. However, 
payment shall not be made prior to that date without the written 
consent of the Grant Officer.
    (e) The Recipient is not entitled to partial payment for partial 
completion of a payment milestone.
    (f) Unless approved by the grant officer, all preceding payment 
milestones must be completed before payment can be made for the next 
payment milestone.
    (g) Invoices hereunder shall be submitted in the original and 
five copies to the Grant Officer for certification.

[End of provision]


Sec. 1274.909  Term of this agreement.

Term of this Agreement (Date)

    The agreement commences on the effective date indicated on the 
attached cover sheet and continues until the expiration date 
indicated on the attached cover sheet unless terminated by either 
party. If all resources are expended prior to the expiration date of 
the agreement, the parties have no obligation to continue 
performance and may elect to cease at that point. The parties may 
extend the expiration date if additional time is required to 
complete the milestones at no increase in Government resources. 
Provisions of this Agreement, which, by their express terms or by 
necessary implication, apply for periods of time other than that 
specified as the agreement term, shall be given effect, 
notwithstanding expiration of the term of the agreement.


[[Page 50378]]


[End of provision]


Sec. 1274.910  Authority.

Authority (Date)

    This is a cooperative agreement as defined in 31 U.S.C. 6305 
(the Chiles Act) and is entered into pursuant to the authority of 42 
U.S.C. 2451, et seq. (the Space Act).

[End of provision]


Sec. 1274.911  Patent rights.

Patent Rights (Date)

    (a) Definitions.
    (1) ``Administrator'' means the Administrator or Deputy 
Administrator of NASA.
    (2) ``Invention'' means any invention or discovery which is or 
may be patentable or otherwise protectable under Title 35 of the 
United States Code.
    (3) ``Made'' when used in relation to any invention means the 
conception or first actual reduction to practice such invention.
    (4) ``Nonprofit organization'' means a domestic university or 
other institution of higher education or an organization of the type 
described in Section 501(c)(3) of the Internal Revenue Code of 1954 
(26 U.S.C. 501(c)) and exempt from taxation under Section 501(a) of 
the Internal Revenue Code (26 U.S.C. 501(a)), or any domestic 
nonprofit scientific or educational organization qualified under a 
State nonprofit organization statute.
    (5) ``Practical application'' means to manufacture, in the case of 
a composition or product; to practice, in the case of a process or 
method; or to operate, in the case of a machine or system; and, in each 
case, under such conditions as to establish that the invention is being 
utilized and that its benefits are, to the extent permitted by law or 
Government regulations, available to the public on reasonable terms.
    (6) ``Recipient'' means:
    (i) the signatory Recipient party or parties or;
    (ii) the Consortium, where a Consortium has been formed for 
carrying out Recipient responsibilities under this agreement.
    (7) ``Small Business Firm'' means a domestic small business 
concern as defined at 15 U.S.C. 632 and implementing regulations 
(see 13 CFR 121.401 through 121.413) of the Administrator of the 
Small Business Administration.
    (8) ``Subject Invention'' means any invention of a Recipient 
and/or Government employee conceived or first actually reduced to 
practice in the performance of work under this Agreement.
    (b) Allocation of Principal Rights.
    (1) Recipient Inventions. For other than Small Business Firm or 
Nonprofit organization Recipients, the ``PATENT RIGHTS--RETENTION BY 
RECIPIENT (LARGE BUSINESS)'' provision applies. For Small Business 
Firm and Nonprofit organization Recipients, the ``PATENT RIGHTS--
RETENTION BY RECIPIENT (SMALL BUSINESS)'' provision applies.
    (2) NASA Inventions. NASA will use reasonable efforts to report 
inventions made by NASA employees as a consequence of, or which bear 
a direct relation to, the performance of specified NASA activities 
under this cooperative agreement and, upon timely request, NASA will 
use its best efforts to grant the Recipient or designated Consortium 
Member (if applicable) the first option to acquire either an 
exclusive or partially exclusive, revocable, royalty-bearing 
license, on terms to be subsequently negotiated, for any patent 
applications and patents covering such inventions, and subject to 
the license reserved in paragraph (b)(5)(i) of this section. Upon 
application in compliance with 37 CFR part 404--Licensing of 
Government Owned Inventions, the Recipient or each Consortium Member 
(if applicable), shall be granted a revocable, nonexclusive, 
royalty-free license in each patent application filed in any country 
on a subject invention and any resulting patent in which the 
Government acquires title. Each nonexclusive license may extend to 
subsidiaries and affiliates, if any, within the corporate structure 
of the licensee and includes the right to grant sublicenses of the 
same scope to the extent the licensee was legally obligated to do so 
at the time the cooperative agreement was signed.
    (3) NASA Contractor Inventions. In the event NASA contractors 
are tasked to perform work in support of specified NASA activities 
under this cooperative agreement and inventions are made by 
contractor employees, the recipient will normally retain title to 
its employee inventions in accordance with 35 U.S.C. 202, 14 CFR 
part 1245, and Executive Order 12591. In the event the recipient 
decides not to pursue right to title in any such invention and NASA 
obtains title to such inventions, NASA will use reasonable efforts 
to report such inventions and, upon timely request, NASA will use 
its best efforts to grant the Recipient or designated Consortium 
Member (if applicable) the first option to acquire either an 
exclusive or partially exclusive, revocable, royalty-bearing 
license, upon terms to be subsequently negotiated, for any patent 
applications and patents covering such inventions, and subject to 
the license reserved in paragraph (b)(5)(ii) of this section. Upon 
application in compliance with 37 CFR part 404--Licensing of 
Government Owned Inventions, the Recipient or each Consortium Member 
(if applicable), shall be granted a revocable, nonexclusive, 
royalty-free license in each patent application filed in any country 
on a subject invention and any resulting patent in which the 
Government acquires title. Each nonexclusive license may extend to 
subsidiaries and affiliates, if any, within the corporate structure 
of the licensee and includes the right to grant sublicenses of the 
same scope to the extent the licensee was legally obligated to do so 
at the time the cooperative agreement was signed.
    (4) Joint NASA and Recipient Inventions. NASA and Recipient 
agree to use reasonable efforts to identify and report to each other 
any inventions made jointly between NASA employees (or employees of 
NASA contractors) and employees of Recipient.
    (i) For other than small business firms and nonprofit 
organizations the Administrator may agree that the United States 
will refrain from exercising its undivided interest in a manner 
inconsistent with Recipient's commercial interest and to cooperate 
with Recipient in obtaining patent protection on its undivided 
interest on any waived inventions subject, however, to the condition 
that Recipient makes its best efforts to bring the invention to the 
point of practical application at the earliest practicable time. In 
the event that the Administrator determines that such efforts are 
not undertaken, the Administrator may void NASA's agreement to 
refrain from exercising its undivided interest and grant licenses 
for the practice of the invention so as to further its development. 
In the event that the Administrator decides to void NASA's agreement 
to refrain from exercising its undivided interest and grant licenses 
for this reason, notice shall be given to the Inventions and 
Contributions Board as to why such action should not be taken. 
Either alternative will be subject to the applicable license or 
licenses reserved in paragraph (b)(5) of this section.
    (ii) For small business firms and nonprofit organization, NASA 
may assign or transfer whatever rights it may acquire in a subject 
invention from its employee to the Recipient as authorized by 35 
U.S.C. 202(e).
    (5) Minimum rights reserved by the Government. Any license or 
assignment granted Recipient pursuant to paragraphs (b)(2), (3), or 
(4) of this section will be subject to the reservation of the 
following licenses:
    (i) As to inventions made solely or jointly by NASA employees, 
the irrevocable, royalty-free right of the Government of the United 
States to practice and have practiced the invention by or on behalf 
of the United States; and
    (ii) As to inventions made solely by, or jointly with, employees 
of NASA contractors, the rights in the Government of the United 
States as set forth in paragraph (b)(5)(i) of this section, as well 
as the revocable, nonexclusive, royalty-free license in the 
contractor as set forth in 14 CFR 1245.108.
    (6) Preference for United States manufacture. The Recipient 
agrees that any products embodying subject inventions or produced 
through the use of subject inventions shall be manufactured 
substantially in the United States. However, in individual cases, 
the requirement to manufacture substantially in the United States 
may be waived by the Associate Administrator for Procurement (Code 
HS) with the concurrence of the Associate General Counsel for 
Intellectual Property upon a showing by the Recipient that under the 
circumstances domestic manufacture is not commercially feasible.
    (7) Work performed by the Recipient under this cooperative 
agreement is considered undertaken to carry out a public purpose of 
support and/or stimulation rather than for acquiring property or 
services for the direct benefit or use of the Government. 
Accordingly, such work by the Recipient is not considered ``by or 
for the United States'' and the Government assumes no liability for 
infringement by the Recipient under 28 U.S.C. 1498.


[[Page 50379]]


[End of provision]


Sec. 1274.912   Patent rights--retention by the Recipient (large 
business).

Patent Rights--Retention by the Recipient (Large Business) (Date)

    (a) Definitions. 
    (1) Administrator, as used in this clause, means the 
Administrator of the National Aeronautics and Space Administration 
(NASA) or duly authorized representative.
    (2) Invention, as used in this clause, means any invention or 
discovery which is or may be patentable or otherwise protectable 
under Title 35 of the United States Code.
    (3) Made, as used in relation to any invention, means the 
conception or first actual reduction to practice such invention.
    (4) Nonprofit organization, as used in this clause, means a 
domestic university or other institution of higher education or an 
organization of the type described in Section 501(c)(3) of the 
Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and exempt from 
taxation under Section 501(a) of the Internal Revenue Code (26 
U.S.C. 501(a)), or any domestic nonprofit scientific or educational 
organization qualified under a State nonprofit organization statute.
    (5) Practical application, as used in this clause, means to 
manufacture, in the case of a composition or product; to practice, 
in the case of a process or method; or to operate, in case of a 
machine or system; and, in each, case, under such conditions as to 
establish that the invention is being utilized and that its benefits 
are, to the extent permitted by law or Government regulations, 
available to the public on reasonable terms.
    (6) Reportable item, as used in this clause, means any 
invention, discovery, improvement, or innovation of the Recipient, 
whether or not the same is or may be patentable or otherwise 
protectable under Title 35 of the United States Code, conceived or 
first actually reduced to practice in the performance of any work 
under this contract or in the performance of any work that is 
reimbursable under any clause in this contract providing for 
reimbursement of costs incurred prior to the effective date of this 
contract.
    (7) Small business firm, as used in this clause, means a 
domestic small business concern as defined at 15 U.S.C. 632 and 
implementing regulations (see 13 CFR 121.401 through 121. 413) of 
the Administrator of the Small Business Administration.
    (8) Subject invention, as used in this clause, means any 
reportable item which is or may be patentable or otherwise 
protectable under Title 35 of the United States Code, or any novel 
variety of plant that is or may be protectable under the Plant 
Variety Protection Act (7 U.S.C. 2321, et seq).
    (b) Allocation of principal rights.
    (1) Presumption of title.
    (i) Any reportable item that the Administrator considers to be a 
subject invention shall be presumed to have been made in the manner 
specified in paragraph (1) or (2) of Section 305(a) of the National 
Aeronautics and Space Act of 1958 (42 U.S.C. 2457(a)) (hereinafter 
called ``the Act''), and the above presumption shall be conclusive 
unless at the time of reporting the reportable item the Recipient 
submits to the Grant Officer a written statement, containing 
supporting details, demonstrating that the reportable item was not 
made in the manner specified in paragraph (1) or (2) of Section 
305(a) of the Act.
    (ii) Regardless of whether title to a given subject invention 
would otherwise be subject to an advance waiver or is the subject of 
a petition for waiver, the Recipient may nevertheless file the 
statement described in paragraph (b)(1)(i) of this section. The 
Administrator will review the information furnished by the Recipient 
in any such statement and any other available information relating 
to the circumstances surrounding the making of the subject invention 
and will notify the Recipient whether the Administrator has 
determined that the subject invention was made in the manner 
specified in paragraph (1) or (2) of Section 305(a) of the Act.
    (2) Property rights in subject inventions. Each subject 
invention for which the presumption of paragraph (b)(1)(i) of this 
section is conclusive or for which there has been a determination 
that it was made in the manner specified in paragraph (1) or (2) of 
Section 305(a) of the Act shall be the exclusive property of the 
United States as represented by NASA unless the Administrator waives 
all or any part of the rights of the United States, as provided in 
paragraph (b)(3) of this section.
    (3) Waiver of rights.
    (i) Section 305(f) of the Act provides for the promulgation of 
regulations by which the Administrator may waive the rights of the 
United States with respect to any invention or class of inventions 
made or that may be made under conditions specified in paragraph (1) 
or (2) of Section 305(a) of the Act. The promulgated NASA Patent 
Waiver Regulations, 14 CFR part 1245, subpart 1, have adopted the 
Presidential memorandum on Government Patent Policy of February 18, 
1983, as a guide in acting on petitions (requests) for such waiver 
of rights.
    (ii) As provided in 14 CFR part 1245, Subpart 1, Recipients may 
petition, either prior to execution of the Agreement or within 30 
days after execution of the Agreement, for advance waiver of rights 
to any or all of the inventions that may be made under an Agreement. 
If such a petition is not submitted, or if after submission it is 
denied, the Recipient (or an employee inventor of the Recipient may 
petition for waiver of rights to an identified subject invention 
within eight months of first disclosure of invention in accordance 
with paragraph (e)(2) of this section or within such longer period 
as may be authorized in accordance with 14 CFR 1245.105. Further 
procedures are provided in the REQUESTS FOR WAIVER OF RIGHTS--LARGE 
BUSINESS provision.
    (c) Minimum rights reserved by the Government.
    (1) With respect to each Recipient subject invention for which a 
waiver of rights is applicable in accordance with 14 CFR part 1245, 
subpart 1, the Government reserves--
    (i) An irrevocable, royalty-free license for the practice of 
such invention throughout the world by or on behalf of the United 
States or any foreign government in accordance with any treaty or 
agreement with the United States; and
    (ii) Such other rights as stated in 14 CFR 1245.107.
    (2) Nothing contained in this paragraph shall be considered to 
grant to the Government any rights with respect to any invention 
other than a subject invention.
    (d) Minimum rights to the Recipient. 
    (1) The Recipient is hereby granted a revocable, nonexclusive, 
royalty-free license in each patent application filed in any country 
on a Recipient subject invention and any resulting patent in which 
the Government acquires title, unless the Recipient fails to 
disclose the subject invention within the times specified in 
paragraph (e)(2) of this section. The Recipient's license extends to 
its domestic subsidiaries and affiliates, if any, within the 
corporate structure of which the Recipient is a party and includes 
the right to grant sublicenses of the same scope to the extent the 
Recipient was legally obligated to do so at the time the contract 
was awarded. The license is transferable only with the approval of 
the Administrator except when transferred to the successor of that 
part of the Recipient's business to which the invention pertains.
    (2) The Recipient's domestic license may be revoked or modified 
by the Administrator to the extent necessary to achieve expeditious 
practical application of the subject invention pursuant to an 
application for an exclusive license submitted in accordance with 14 
CFR part 1245, subpart 2, Licensing of NASA Inventions. This license 
will not be revoked in that field of use or the geographical areas 
in which the Recipient has achieved practical application and 
continues to make the benefits of the invention reasonably 
accessible to the public. The license in any foreign country may be 
revoked or modified at the discretion of the Administrator to the 
extent the Recipient, its licensees, or its domestic subsidiaries or 
affiliates have failed to achieve practical application in that 
foreign country.
    (3) Before revocation or modification of the license, the 
Recipient will be provided a written notice of the Administrator's 
intention to revoke or modify the license, and the Recipient will be 
allowed 30 days (or such other time as may be authorized by the 
Administrator for good cause shown by the Recipient) after the 
notice to show cause why the license should not be revoked or 
modified. The Recipient has the right to appeal, in accordance with 
14 CFR 1245.211, any decision concerning the revocation or 
modification of its license.
    (e) Invention identification, disclosures, and reports.
    (1) The Recipient shall establish and maintain active and 
effective procedures to assure that reportable items are promptly 
identified and disclosed to Recipient personnel responsible for the 
administration of this clause within six months of conception and/or 
first actual reduction to practice, whichever occurs first in the 
performance of work under this contract. These procedures shall 
include the maintenance of laboratory notebooks or equivalent 
records and other records as are

[[Page 50380]]

reasonably necessary to document the conception and/or the first 
actual reduction to practice of the reportable items, and records 
that show that the procedures for identifying and disclosing 
reportable items are followed. Upon request, the Recipient shall 
furnish the Grant Officer a description of such procedures for 
evaluation and for determination as to their effectiveness.
    (2) The Recipient will disclose each reportable item to the 
Grant Officer within two months after the inventor discloses it in 
writing to Recipient personnel responsible for the administration of 
this clause or, if earlier, within six months after the Recipient 
becomes aware that a reportable item has been made, but in any event 
for subject inventions before any on sale, public use, or 
publication of such invention known to the Recipient. The disclosure 
to the agency shall be in the form of a written report and shall 
identify the Agreement under which the reportable item was made and 
the inventor(s) or innovator(s). It shall be sufficiently complete 
in technical detail to convey a clear understanding, to the extent 
known at the time of the disclosure, of the nature, purpose, 
operation, and physical, chemical, biological, or electrical 
characteristics of the reportable item. The disclosure shall also 
identify any publication, on sale, or public use of any subject 
invention and whether a manuscript describing such invention has 
been submitted for publication and, if so, whether it has been 
accepted for publication at the time of disclosure. In addition, 
after disclosure to the agency, the Recipient will promptly notify 
the agency of the acceptance of any manuscript describing a subject 
invention for publication or of any on sale or public use planned by 
the Recipient for such invention.
    (3) The Recipient shall furnish the Grant Officer the following:
    (i) Interim reports every 12 months (or such longer period as 
may be specified by the Grant Officer) from the date of the 
Agreement, listing reportable items during that period, and 
certifying that all reportable items have been disclosed (or that 
there are no such inventions) and that the procedures required by 
paragraph (e)(1) of this section have been followed.
    (ii) A final report, within three months after completion of the 
work, listing all reportable items or certifying that there were no 
such reportable items, and listing all subcontracts at any tier 
containing a patent rights clause or certifying that there were no 
such subcontracts.
    (4) The Recipient agrees, upon written request of the Grant 
Officer, to furnish additional technical and other information 
available to the Recipient as is necessary for the preparation of a 
patent application on a subject invention and for the prosecution of 
the patent application, and to execute all papers necessary to file 
patent applications on subject inventions and to establish the 
Government's rights in the subject inventions.
    (5) The Recipient agrees, subject to 48 CFR (FAR) 27.302(j), 
that the Government may duplicate and disclose subject invention 
disclosures and all other reports and papers furnished or required 
to be furnished pursuant to this clause.
    (f) Examination of records relating to inventions.
    (1) The Grant Officer or any authorized representative shall, 
pursuant to the Retention and Examination of Records provision of 
this cooperative agreement, have the right to examine any books 
(including laboratory notebooks), records, and documents of the 
Recipient relating to the conception or first actual reduction to 
practice of inventions in the same field of technology as the work 
under this contract to determine whether--
    (i) Any such inventions are subject inventions;
    (ii) The Recipient has established and maintained the procedures 
required by paragraph (e)(1) of this section; and
    (iii) The Recipient and its inventors have complied with the 
procedures.
    (2) If the Grant Officer learns of an unreported Recipient 
invention that the Grant Officer believes may be a subject 
inventions, the Recipient may be required to disclose the invention 
to the agency for a determination of ownership rights.
    (3) Any examination of records under this paragraph will be 
subject to appropriate conditions to protect the confidentiality of 
the information involved.
    (g) Subcontracts.
    (1) Unless otherwise authorized or directed by the Grant 
Officer, the Recipient shall--
    (i) Include this Clause Patent Rights--Retention by the 
Recipient--(Large Business) (suitably modified to identify the 
parties) in any subcontract hereunder (regardless of tier) with 
other than a small business firm or nonprofit organization for the 
performance of experimental, developmental, or research work; and
    (ii) Include the clause Patent Right--Retention by the 
Recipient--(Small Business) (suitably modified to identify the 
parties) in any subcontract hereunder (regardless of tier) with a 
small business firm or nonprofit organization for the performance of 
experimental, developmental, or research work.
    (2) In the event of a refusal by a prospective subcontractor to 
accept such a clause the Recipient--
    (i) Shall promptly submit a written notice to the Grant Officer 
setting forth the subcontractor's reasons for such refusal and other 
pertinent information that may expedite disposition of the matter; 
and
    (ii) Shall not proceed with such subcontract without the written 
authorization of the Grant Officer.
    (3) The Recipient shall promptly notify the Grant Officer in 
writing upon the award of any subcontract at any tier containing a 
patent rights clause by identifying the subcontractor, the 
applicable patent rights clause, the work to be performed under the 
subcontract, and the dates of award and estimated completion. Upon 
request of the Grant Officer, the Recipient shall furnish a copy of 
such subcontract, and, no more frequently than annually, a listing 
of the subcontracts that have been awarded.
    (4) The subcontractor will retain all rights provided for the 
Recipient in the clause of paragraph (g)(1)(i) or (1)(ii) of this 
section, whichever is included in the subcontract, and the Recipient 
will not, as part of the consideration for awarding the subcontract, 
obtain rights in the subcontractor's subject inventions.
    (5) Notwithstanding paragraph (g)(4) of this section, and in 
recognition of the contractor's substantial contribution of funds, 
facilities and/or equipment to the work performed under this 
cooperative agreement, the Recipient is authorized, subject to the 
rights of NASA set forth elsewhere in this clause, to:
    (i) Acquire by negotiation and mutual agreement rights to a 
subcontractor's subject inventions as the Recipient may deem 
necessary to obtaining and maintaining of such private support; and
    (ii) Request, in the event of inability to reach agreement 
pursuant to paragraph (g)(5)(i) of this section, that NASA invoke 
exceptional circumstances as necessary pursuant to 37 CFR 
401.3(a)(2) if the prospective subcontractor is a small business 
firm or organization, or for all other organizations, request that 
such rights for the Recipient be included as an additional 
reservation in a waiver granted pursuant to 14 CFR part 1245, 
subpart 1. Any such requests to NASA should be prepared in 
consideration of the following guidance and submitted to the 
contract officer.
    (A) Exceptional circumstances: A request that NASA make an 
``exceptional circumstances'' determination pursuant to 37 CFR 
401.3(a)(2) must state the scope of rights sought by the Recipient 
pursuant to such determination; identify the proposed subcontractor 
and the work to be performed under the subcontract; and state the 
need for the determination.
    (B) Waiver petition: The subcontractor should be advised that 
unless it requests a waiver of title pursuant to the NASA Patent 
Waiver Regulations (14 CFR part 1245, subpart 1), NASA will acquire 
title to the subject invention (42 U.S.C. 2457, as amended, Sec. 
305). If a waiver is not requested or granted, the Recipient may 
request a license from NASA (see licensing of NASA inventions, 14 
CFR part 1245, subpart 2). A subcontractor requesting a waiver must 
follow the procedures set forth in the attached clause REQUESTS FOR 
WAIVER OF RIGHTS--LARGE BUSINESS.

    (h) Preference for United States manufacture. The Recipient 
agrees that any products embodying subject inventions or produced 
through the use of subject inventions shall be manufactured 
substantially in the United States. However, in individual cases, 
the requirement to manufacture substantially in the United States 
may be waived by the Associate Administrator for Procurement (Code 
HS) with the concurrence of the Associate General Counsel for 
Intellectual Property upon a showing by the Recipient that under the 
circumstances domestic manufacture is not commercially feasible.
    (i) March-in rights. The Recipient agrees that, with respect to 
any subject invention in which it has acquired title, NASA has the 
right in accordance with the procedures in 37 CFR 401.6 and any 
supplemental regulations of the agency to require the Recipient, an 
assignee or exclusive licensee of a subject

[[Page 50381]]

invention to grant a nonexclusive, partially exclusive, or exclusive 
license in any field of use to a responsible applicant or 
applicants, upon terms that are reasonable under the circumstances, 
and if the Subcontractor, assignee, or exclusive licensee refuses 
such a request NASA has the right to grant such a license itself if 
the Federal agency determines that--
    (1) Such action is necessary because the Recipient or assignee 
has not taken, or is not expected to take within a reasonable time, 
effective steps to achieve practical application of the subject 
invention in such field of use;
    (2) Such action is necessary to alleviate health or safety needs 
which are not reasonably satisfied by the Recipient, assignee, or 
their licensees;
    (3) Such action is necessary to meet requirements for public use 
specified by Federal regulations and such requirements are not 
reasonably satisfied by the Recipient, assignee, or licensees; or
    (4) Such action is necessary because the agreement required by 
paragraph (i) of this clause has not been obtained or waived or 
because a licensee of the exclusive right to use or sell any subject 
invention in the United States is in breach of such agreement.

[End of provision]


Sec. 1274.913  Patent rights--retention by the Recipient (small 
business).

Patent Rights--Retention by the Recipient (Small Business) (Date)

    (a) Definitions.
    (1) ``Invention,'' as used in this clause, means any invention 
or discovery which is or may be patentable or otherwise protectable 
under title 35 of the U.S.C.
    (2) ``Made,'' as used in this clause, when used in relation to 
any invention means the conception or first actual reduction to 
practice such invention.
    (3) ``Nonprofit organization,'' as used in this clause, means a 
university or other institution of higher education or an 
organization of the type described in Section 501(c)(3) of the 
Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and exempt from 
taxation under Section 501(a) of the Internal Revenue Code (26 
U.S.C. 501(a)) or any nonprofit scientific or educational 
organization qualified under a state nonprofit organization statute.
    (4) ``Practical application,'' as used in this clause, means to 
manufacture, in the case of a composition of product; to practice, 
in the case of a process or method, or to operate, in the case of a 
machine or system; and, in each case, under such conditions as to 
establish that the invention is being utilized and that its benefits 
are, to the extent permitted by law or Government regulations, 
available to the public on reasonable terms.
    (5) ``Small business firm,'' as used in this clause, means a 
small business concern as defined at Section 2 of Public Law 85-536 
(15 U.S.C. 632) and implementing regulations (see 13 CFR 121.401 
through 121.413 of the Administrator of the Small Business 
Administration.
    (6) ``Subject invention,'' as used in this clause, means any 
invention of the Subcontractor conceived or first actually reduced 
to practice in the performance of work under this Agreement.
    (b) Allocation of principal rights. The Recipient may retain the 
entire right, title, and interest throughout the world to each 
subject invention subject to the provisions of this clause and 35 
U.S.C. 203. With respect to any subject invention in which the 
Recipient retains title, the Federal Government shall have a 
nonexclusive, nontransferable, irrevocable, paid-up license to 
practice or have practiced for or on behalf of the United States the 
subject invention throughout the world.
    (c) Invention disclosure, election of title, and filing of 
patent application by Recipient.
    (1) The Recipient will disclose each subject invention to NASA 
within two months after the inventor discloses it in writing to 
Recipient personnel responsible for patent matters. The disclosure 
to the agency shall be in the form of a written report and shall 
identify the contract under which the invention was made and the 
inventor(s). It shall be sufficiently complete in technical detail 
to convey a clear understanding to the extent known at the time of 
the disclosure, of the nature, purpose, operation, and the physical, 
chemical, biological or electrical characteristics of the invention. 
The disclosure shall also identify any publication, on sale or 
public use of the invention and whether a manuscript describing the 
invention has been submitted for publication and, if so, whether it 
has been accepted for publication at the time of disclosure. In 
addition, after disclosure to the agency, the Recipient will 
promptly notify the agency of the acceptance of any manuscript 
describing the invention for publication or of any sale or public 
use planned by the Recipient.
    (2) The Recipient will elect in writing whether or not to retain 
title to any such invention by notifying NASA within two years of 
disclosure to the Federal agency. However, in any case where 
publication, on sale or public use has initiated the one-year 
statutory period wherein valid patent protection can still be 
obtained in the United States, the period for election of title may 
be shortened by the agency to a date that is no more than 60 days 
prior to the end of the statutory period.
    (3) The Recipient will file its initial patent application on a 
subject invention to which it elects to retain title within one year 
after election of title or, if earlier, prior to the end of any 
statutory period wherein valid patent protection can be obtained in 
the United States after a publication, on sale, or public use. The 
Recipient will file patent applications in additional countries or 
international patent offices within either 10 months of the 
corresponding initial patent application of six months from the date 
permission is granted by the Commissioner of Patents and Trademarks 
to file foreign patent applications where such filing has been 
prohibited by a Secrecy Order.
    (4) Requests for extension of the time for disclosure election, 
and filing under paragraphs (c)(1), (2), and (3) of this section 
may, at the discretion of the agency, be granted.
    (d) Conditions when the Government may obtain title. The 
Recipient will convey to NASA, upon written request, title to any 
subject invention--
    (1) If the Recipient fails to disclose or elect title to the 
subject invention within the times specified in paragraph (c) of 
this section, or elects not to retain title; provided, that the 
agency may only request title within 60 days after learning of the 
failure of the Recipient to disclose or elect within the specified 
times.
    (2) In those countries in which the Recipient fails to file 
patent applications within the times specified in paragraph (c) of 
this section; provided, however, that if the Recipient has filed a 
patent application in a country after the times specified in 
paragraph (c) of this section, but prior to its receipt of the 
written request of the Federal agency, the Recipient shall continue 
to retain title in that country.
    (3) In any country in which the Recipient decides not to 
continue the prosecution of any application for, to pay the 
maintenance fees on, or defend in reexamination or opposition 
proceeding on, a patent on a subject invention.
    (e) Minimum rights to Recipient and protection of the Recipient 
right to file.
    (1) The Recipient will retain a nonexclusive, royalty-free 
license throughout the world in each subject invention to which the 
Government obtains title, except if the Recipient fails to disclose 
the invention within the times specified in paragraph (c) of this 
section. The Recipient's license extends to its domestic subsidiary 
and affiliates, if any, within the corporate structure of which the 
Recipient is a party and includes the right to grant sublicenses of 
the same scope to the extent the Recipient was legally obligated to 
do so at the time the agreement was awarded. The license is 
transferable only with the approval of NASA, except when transferred 
to the successor of that part of the Recipient's business to which 
the invention pertains.
    (2) The Contractor's domestic license may be revoked or modified 
by NASA to the extent necessary to achieve expeditious practical 
application of subject invention pursuant to an application for an 
exclusive license submitted in accordance with applicable provisions 
at 37 CFR part 404 and agency licensing regulations (if any). This 
license will not be revoked in that field of use or the geographical 
areas in which the Subcontractor has achieved practical application 
and continues to make the benefits of the invention reasonable 
accessible to the public. The license in any foreign country may be 
revoked or modified at the discretion of NASA to the extent the 
Subcontractor, its licensees, or the domestic subsidiaries or 
affiliates have failed to achieve practical application in that 
foreign country.
    (3) Before revocation or modification of the license, NASA will 
furnish the Recipient a written notice of its intention to revoke or 
modify the license, and the Recipient will be allowed 30 days (or 
such other time as may be authorized by NASA for good cause shown by 
the Recipient) after the notice to show cause why the license should 
not be revoked or modified. The Recipient has the right to appeal, 
in accordance with applicable regulations in 37 CFR part 404,

[[Page 50382]]

concerning the licensing of Government-owned inventions, any 
decision concerning the revocation or modification of the license.
    (f) Recipient action to protect the Government's interest.
    (1) The Recipient agrees to execute or to have executed and 
promptly deliver to NASA all instruments necessary to:
    (i) establish or confirm the rights the Government has 
throughout the world in those subject inventions to which the 
Subcontractor elects to retain title, and,
    (ii) convey title to the Federal agency when requested under 
paragraph (d) of this section and to enable the Government to obtain 
patent protection throughout the world in that subject invention.
    (2) The Recipient agrees to require, by written agreement, its 
employees, other than clerical and nontechnical employees, to 
disclose promptly in writing to personnel identified as responsible 
for the administration of patent matters and in a format suggested 
by the Recipient each subject invention made under contract in order 
that the Recipient can comply with the disclosure provisions of 
paragraph (c) of this section, and to execute all papers necessary 
to file patent applications on subject inventions and to establish 
the Government's rights in the subject inventions. This disclosure 
format should require, as a minimum, the information required by 
paragraph (c)(1) of this section. The Recipient shall instruct such 
employees, through employee agreements or other suitable educational 
programs, on the importance of reporting inventions in sufficient 
time to permit the filing of patent applications prior to U.S. or 
foreign statutory bars.
    (3) The Recipient will notify NASA of any decisions not to 
continue the prosecution of a patent application, pay maintenance 
fees, or defend in a reexamination or opposition proceeding on a 
patent, in any country, not less than 30 days before the expiration 
of the response period required by the relevant patent office.
    (4) The Recipient agrees to include, within the specification of 
any United States patent application and any patent issuing thereon 
covering a subject invention the following statement, ``This 
invention was made with Government support under (identify the 
agreement) awarded by NASA. The Government has certain rights in the 
invention.''
    (5) The Recipient shall provide the Grant Officer the following:
    (i) A listing every 12 months (or such longer period as the 
Grant Officer may specify) from the date of the Agreement, of all 
subject inventions required to be disclosed during the period.
    (ii) A final report prior to closeout of the Agreement listing 
all subject inventions or certifying that there were none.
    (iii) Upon request, the filing date, serial number, and title, a 
copy of the patent application, and patent number and issue date for 
any subject invention in any country in which the Recipient has 
applied for patents.
    (iv) An irrevocable power to inspect and make copies of the 
patent application file, by the Government, when a Federal 
Government employee is a co-inventor.
    (g) Subcontracts.
    (1) Unless otherwise authorized or directed by the Grant 
Officer, the Recipient shall--
    (i) Include this clause (Patent Rights--Retention by the 
Recipient (Small Business)), suitably modified to identify the 
parties, in all subcontracts, regardless of tier, for experimental, 
developmental, or research work to be performed by a small business 
firm or domestic nonprofit organization; and
    (ii) Include in all other subcontracts, regardless of tier, for 
experimental, developmental, or research work the patent rights 
clause (Patent Rights--Retention by the Recipient (Large Business).
    (2) In the event of a refusal by a prospective subcontractor to 
accept such a clause the Recipient--
    (i) Shall promptly submit a written notice to the Grant Officer 
setting forth the subcontractor's reasons for such refusal and other 
pertinent information that may expedite disposition of the matter; 
and
    (ii) Shall not proceed with such subcontract without the written 
authorization of the Grant Officer.
    (3) The Recipient shall promptly notify the Grant Officer in 
writing upon the award of any subcontract at any tier containing a 
patent rights clause by identifying the subcontractor, the 
applicable patent rights clause, the work to be performed under the 
subcontract, and the dates of award and estimated completion. Upon 
request of the Grant Officer, the Recipient shall furnish a copy of 
such subcontract, and, no more frequently than annually, a listing 
of the subcontracts that have been awarded.
    (4) The subcontractor will retain all rights provided for the 
Recipient in the clause under paragraph (g)(1)(i) or (ii) of this 
section, whichever is included in the subcontract, and the Recipient 
will not, as part of the consideration for awarding the subcontract, 
obtain rights in the subcontractor's subject inventions.
    (5) Notwithstanding paragraph (g)(4) of this section, and in 
recognition of the contractor's substantial contribution of funds, 
facilities and/or equipment to the work performed under this 
cooperative agreement, the Recipient is authorized, subject to the 
rights of NASA set forth elsewhere in this clause, to--
    (i) Acquire by negotiation and mutual agreement rights to a 
subcontractor's subject inventions as the Recipient may deem 
necessary to obtaining and maintaining of such private support; and
    (ii) Request, in the event of inability to reach agreement 
pursuant to paragraph (g)(5)(i) of this section that NASA invoke 
exceptional circumstances as necessary pursuant to 37 CFR 
401.3(a)(2) if the prospective subcontractor is a small business 
firm or organization, or for all other organizations, request that 
such rights for the Recipient be included as an additional 
reservation in a waiver granted pursuant to 14 CFR part 1245, 
subpart 1. Any such requests to NASA should be prepared in 
consideration of the following guidance and submitted to the 
contract officer.
    (A) Exceptional circumstances: A request that NASA make an 
``exceptional circumstances'' determination pursuant to 37 CFR 
401.3(a)(2) must state the scope of rights sought by the Recipient 
pursuant to such determination; identify the proposed subcontractor 
and the work to be performed under the subcontract; and state the 
need for the determination.
    (B) Waiver petition: The subcontractor should be advised that 
unless it requests a waiver of title pursuant to the NASA Patent 
Waiver Regulations (14 CFR part 1245, subpart 1), NASA will acquire 
title to the subject invention (42 U.S.C. 2457, as amended, Sec. 
305). If a waiver is not requested or granted, the Recipient may 
request a license from NASA (see licensing of NASA inventions, 14 
CFR part 1245, subpart 2). A subcontractor requesting a waiver must 
follow the procedures set forth in the REQUESTS FOR WAIVER OF 
RIGHTS--LARGE BUSINESS provision.
    (h) Reporting on utilization of subject inventions. The 
Recipient agrees to submit, on request, periodic reports no more 
frequently than annually on the utilization of a subject invention 
or on efforts at obtaining such utilization that are being made by 
the Recipient or its licensees or assignees. Such reports shall 
include information regarding the status of development, date of 
first commercial sale or use, gross royalties received by the 
Recipient, and such other data and information as the agency may 
reasonably specify. The Recipient also agrees to provide additional 
reports as may be requested by the agency in connection with any 
march-in proceeding under-taken by the agency in accordance with 
paragraph (i) of this section. As required by 35 U.S.C. 202(c)(5), 
the agency agrees it will not disclose such information to persons 
outside the Government without permission of the Recipient.
    (i) Preference for United States manufacture. The Recipient 
agrees that any products embodying subject inventions or produced 
through the use of subject inventions shall be manufactured 
substantially in the United States. However, in individual cases, 
the requirement to manufacture substantially in the United States 
may be waived by the Associate Administrator for Procurement (Code 
HS) with the concurrence of the Associate General Counsel for 
Intellectual Property upon a showing by the Recipient that under the 
circumstances domestic manufacture is not commercially feasible.
    (j) March-in rights. The Recipient agrees that, with respect to 
any subject invention in which it has acquired title, NASA has the 
right in accordance with the procedures in 37 CFR 401.6 and any 
supplemental regulations of the agency to require the Recipient, an 
assignee or exclusive licensee of a subject invention to grant a 
nonexclusive, partially exclusive, or exclusive license in any field 
of use to a responsible applicant or applicants, upon terms that are 
reasonable under the circumstances, and if the Subcontractor, 
assignee, or exclusive licensee refuses such a request NASA has the 
right to grant such a license itself if the Federal agency 
determines that--
    (1) Such action is necessary because the Recipient or assignee 
has not taken, or is not expected to take within a reasonable time,

[[Page 50383]]

effective steps to achieve practical application of the subject 
invention in such field of use;
    (2) Such action is necessary to alleviate health or safety needs 
which are not reasonably satisfied by the Recipient, assignee, or 
their licensees;
    (3) Such action is necessary to meet requirements for public use 
specified by Federal regulations and such requirements are not 
reasonably satisfied by the Recipient, assignee, or licensees; or
    (4) Such action is necessary because the agreement required by 
paragraph (i) of this section has not been obtained or waived or 
because a licensee of the exclusive right to use or sell any subject 
invention in the United States is in breach of such agreement.
    (k) Special provisions for Agreements with nonprofit 
organizations. If the Recipient is a nonprofit organization, it 
agrees that--
    (1) Rights to a subject invention in the United States may not 
be assigned without the approval of NASA, except where such 
assignment is made to an organization which has one of its primary 
functions the management of inventions; provided, that such assignee 
will be subject to the same provisions as the Recipient;
    (2) The Recipient will share royalties collected on a subject 
invention with the inventor, including Federal employee co-inventors 
(when NASA deems it appropriate) when the subject invention is 
assigned in accordance with 35 U.S.C. 202(e) and 37 CFR 401.10;
    (3) The balance of any royalties or income earned by the 
Recipient with respect to subject inventions, after payment of 
expenses (including payments to inventors) incidental to the 
administration of subject inventions will be utilized for the 
support of scientific research or education; and
    (4) It will make efforts that are reasonable under the 
circumstances to attract licensees of subject inventions that are 
small business firms, and that it will give a preference to a small 
business firm when licensing a subject invention if the Recipient 
determines that the small business firm has a plan or proposal for 
marketing the invention which, if executed, is equally as likely to 
bring the invention to practical application as any plans or 
proposals from applicants that are not small business firms; 
provided that the Recipient is also satisfied that the small 
business firm has the capability and resources to carry out its plan 
or proposal. The decision whether to give a preference in any 
specific case will be at the discretion of the Recipient. However, 
the Recipient agrees that the Secretary of Commerce may review the 
Contractor's licensing program and decisions regarding small 
business applicants, and the Recipient will negotiate changes to its 
licensing policies, procedures, or practices with the Secretary of 
Commerce when the Secretary's review discloses that the Recipient 
could take reasonable steps to more effectively implement the 
requirements of this paragraph.
    (l) A copy of all submissions or requests required by this 
clause, plus a copy of any reports, manuscripts, publications, or 
similar material bearing on patent matters, shall be sent to the 
installation Patent Counsel in addition to any other submission 
requirements in the cooperative agreement. If any reports contain 
information describing a ``subject invention'' for which the 
Recipient has elected or may elect title, NASA will use reasonable 
efforts to delay public release by NASA or publication by NASA in a 
NASA technical series, in order for a patent application to be 
filed, provided that the Recipient identify the information and the 
``subject invention'' to which it relates at the time of submittal. 
If required by the Grant Officer, the Recipient shall provide the 
filing date, serial number and title, a copy of the patent 
application, and a patent number and issue date for any ``subject 
invention'' in any country in which the Recipient has applied for 
patents.

[End of provision]


Sec. 1274.914  Requests for waiver of rights--large business.

Requests for Waiver of Rights--Large Business (Date)

    (a) In accordance with the NASA Patent Waiver Regulations, 14 
CFR part 1245, subpart 1, waiver of rights to any or all inventions 
made or that may be made under a NASA agreement, contract or 
subcontract with other than a small business firm or a domestic 
nonprofit organization may be requested at different time periods. 
Advance waiver of rights to any or all inventions that may be made 
under a contract or subcontract may be requested prior to the 
execution of the agreement, contract or subcontract, or within 30 
days after execution by the selected Recipient. In addition, waiver 
of rights to an identified invention made and reported under an 
agreement, contract or subcontract may be requested, even though a 
request for an advance waiver was not made or, if made, was not 
granted.
    (b) Each request for waiver of rights shall be by petition to 
the Administrator and shall include an identification of the 
petitioner; place of business and address; if petitioner is 
represented by counsel, the name, address, and telephone number of 
the counsel; the signature of the petitioner or authorized 
representative; and the date of signature. No specific forms need be 
used, but the request should contain a positive statement that 
waiver of rights is being requested under the NASA Patent Waiver 
Regulations; a clear indication of whether the request is for an 
advance waiver or for a waiver of rights for an individual 
identified invention; whether foreign rights are also requested and, 
if so, the countries, and a citation of the specific section or 
sections of the regulations under which such rights are requested; 
and the name, address, and telephone number of the party with whom 
to communicate when the request is acted upon. Requests for advance 
waiver of rights should, preferably, be included with the proposal, 
but in any event in advance of negotiations.
    (c) Petitions for advance waiver, prior to agreement execution, 
must be submitted to the Grant Officer. All other petitions will be 
submitted to the Patent Representative designated in the contract.
    (d) Petitions submitted with proposals selected for negotiation 
of an agreement will be forwarded by the Grant Officer to the 
installation Patent Counsel for processing and then to the 
Inventions and Contributions Board. The Board will consider these 
petitions and where the Board makes the findings to support the 
waiver, the Board will recommend to the Administrator that waiver be 
granted, and will notify the petitioner and the Grant Officer of the 
Administrator's determination. The Grant Officer will be informed by 
the Board whenever there is insufficient time or information or 
other reasons to permit a decision to be made without unduly 
delaying the execution of the agreement. In the latter event, the 
petitioner will be so notified by the Grant Officer. All other 
petitions will be processed by installation Patent Counsel and 
forwarded to the Board. The Board shall notify the petitioner of its 
action and if waiver is granted, the conditions, reservations, and 
obligations thereof will be included in the Instrument of Waiver. 
Whenever the Board notifies a petitioner of a recommendation adverse 
to, or different from, the waiver requested, the petitioner may 
request reconsideration under procedures set forth in the 
Regulations.

[End of provision]


Sec. 1274.915  Restrictions on sale or transfer of technology to 
foreign firms or institutions.

Restrictions on Sale or Transfer of Technology to Foreign Firms or 
Institutions (Date)

    (a) The parties agree that access to technology developments 
under this Agreement by foreign firms or institutions must be 
carefully controlled. For purposes of this clause, a transfer 
includes a sale of the company, or sales or licensing of the 
technology. Transfers do not include--
    (1) Sales of products or components;
    (2) Licenses of software or documentation related to sales of 
products or components; or
    (3) Transfers to foreign subsidiaries of the Recipient for 
purposes related to this Agreement.
    (b) The Recipient shall provide timely notice to the Grant 
Officer in writing of any proposed transfer of technology developed 
under this Agreement. If NASA determines that the transfer may have 
adverse consequences to the national security interests of the 
United States, or to the establishment of a robust United States 
industry, NASA and the Recipient shall jointly endeavor to find 
alternatives to the proposed transfer which obviate or mitigate 
potential adverse consequences of the transfer.

[End of provision]


Sec. 1274.916  Liability and risk of loss.

Liability and Risk of Loss (Date)

    (a) With regard to activities undertaken pursuant to this 
agreement, neither party shall make any claim against the other, 
employees of the other, the other's related entities (e.g., 
contractors, subcontractors, etc.), or employees of the other's 
related entities for any injury to or death of its own

[[Page 50384]]

employees or employees of its related entities, or for damage to or 
loss of its own property or that of its related entities, whether 
such injury, death, damage or loss arises through negligence or 
otherwise, except in the case of willful misconduct.
    (b) To the extent that a risk of damage or loss is not dealt 
with expressly in this agreement, each party's liability to the 
other party arising out of this Agreement, whether or not arising as 
a result of an alleged breach of this Agreement, shall be limited to 
direct damages only, and shall not include any loss of revenue or 
profits or other indirect or consequential damages.

[End of provision]


Sec. 1274.917  Additional funds.

Additional Funds (Date)

    Pursuant to this agreement, NASA is providing a fixed amount of 
funding for activities to be undertaken under the terms of this 
cooperative agreement. NASA is under no obligation to provide 
additional funds. Under no circumstances shall the Recipient 
undertake any action which could be construed to imply an increased 
commitment on the part of NASA under this cooperative agreement.

[End of provision]


Sec. 1274.918  Incremental funding.

Incremental Funding (Date)

    (a) Of the award amount indicated on the cover page of this 
agreement, only the obligated amount indicated on the cover page of 
this agreement is available for payment. NASA anticipates making 
additional allotments of funds as required,
    (b) These funds will be obligated as appropriated funds become 
available without any action required of the Recipient. NASA is not 
obligated to make payments in excess of the total funds obligated.

[End of provision]


Sec. 1274.919  Cost principles and accounting standards.

Cost Principles and Accounting Standards (Date)

    The expenditure of Government funds by the Recipient and the 
allowability of costs recognized as a resource contribution by the 
Recipient (See clause entitled ``Resource Sharing Requirements'') 
shall be governed by the FAR cost principles, 48 CFR part 31. (If 
the Recipient is a consortium which includes non-commercial firm 
members, cost allowability for those members will be determined as 
follows: Allowability of costs incurred by State, local or 
federally-recognized Indian tribal governments is determined in 
accordance with the provisions of OMB Circular A-87, ``Cost 
Principles for State and Local Governments.'' The allowability of 
costs incurred by non-profit organizations is determined in 
accordance with the provisions of OMB Circular A-122, ``Cost 
Principles for Non-Profit Organizations.'' The allowability of costs 
incurred by institutions of higher education is determined in 
accordance with the provisions of OMB Circular A-21, ``Cost 
Principles for Educational Institutions.'' The allowability of costs 
incurred by hospitals is determined in accordance with the 
provisions of appendix E of 45 CFR part 74, ``Principles for 
Determining Costs Applicable to Research and Development Under 
Grants and Contracts with Hospitals.'') Recipient's method for 
accounting for the expenditure of funds must be consistent with 
Generally Accepted Accounting Principles.

[End of provision]


Sec. 1274.920  Responsibilities of the NASA Technical Officer.

Responsibilities of the NASA Technical Officer (Date)

    (a) The NASA Grant Administrator and Technical Officer for this 
cooperative agreement are identified on the cooperative agreement 
cover sheet.
    (b) The Grant Specialist shall serve as NASA's authorized 
representative for the administrative elements of all work to be 
performed under the agreement.
    (c) The Technical Officer shall have the authority to issue 
written Technical Advice which suggests redirecting the project work 
(e.g., by changing the emphasis among different tasks), or pursuing 
specific lines of inquiry likely to assist in accomplishing the 
effort. The Technical Officer shall have the authority to approve or 
disapprove those technical reports, plans, and other technical 
information the Recipient is required to submit to NASA for 
approval. The Technical Officer is not authorized to issue and the 
Recipient shall not follow any Technical Advice which constitutes 
work which is not contemplated under this agreement; which in any 
manner causes an increase or decrease in the resource sharing or in 
the time required for performance of the project; which has the 
effect of changing any of the terms or conditions of the cooperative 
agreement; or which interferes with the Recipient's right to perform 
the project in accordance with the terms and conditions of this 
cooperative agreement.

[End of provision]


Sec. 1274.921 Publications and reports: Non-proprietary research 
results.

Publications and Reports: Non-Proprietary Research Results (Date)

    (a) NASA encourages the widest practicable dissemination of 
research results at all times during the course of the investigation 
consistent with the other terms of this agreement.
    (b) All information disseminated as a result of the cooperative 
agreement shall contain a statement which acknowledges NASA's 
support and identifies the cooperative agreement by number.
    (c) Prior approval by the NASA Technical Officer is required 
only where the Recipient requests that the results of the research 
be published in a NASA scientific or technical publication. Two 
copies of each draft publication shall accompany the approval 
request.
    (d) Reports shall contain full bibliographic references, 
abstracts of publications and lists of all other media in which the 
research was discussed. The Recipient shall submit the following 
technical reports:
    (1) A progress report for every year of the cooperative 
agreement (except the final year). Each report is due 60 days before 
the anniversary date of the cooperative agreement and shall describe 
research accomplished during the report period.
    (2) A summary of research is due by 90 days after the expiration 
date of the cooperative agreement, regardless of whether or not 
support is continued under another cooperative agreement. This 
report is intended to summarize the entire research accomplished 
during the duration of the cooperative agreement.
    (e) Progress reports and summaries of research shall display the 
following on the first page:
    (1) Title of the cooperative agreement.
    (2) Type of report.
    (3) Period covered by the report.
    (4) Name and address of the Recipient's organization.
    (5) Cooperative agreement number.
    (f) An original and two copies, one of which shall be of 
suitable quality to permit micro-reproduction, shall be sent as 
follows:
    (1) Original--Grant Officer.
    (2) Copy--Technical Officer.
    (3) Micro-reproducible copy--NASA Center for Aerospace 
Information (CASI), Parkway Center, Attn: Document Processing 
Section, 7121 Standard Drive, Hanover, MD 21076.
    (g) The requirements set forth under this provision may be 
modified by the Grant Officer based on specific report needs for the 
particular grant or cooperative agreement.

[End of provision]


Sec. 1274.922  Suspension or termination.

Suspension or Termination (Date)

    (a) This cooperative agreement may be suspended or terminated in 
whole or in part by the Recipient or by NASA after consultation with 
the other party. NASA may terminate the agreement, for example, if 
the Recipient is not making anticipated technical progress, if the 
Recipient materially fails to comply with the terms of the 
agreement, if the Recipient materially changes the objective of the 
agreement, or if appropriated funds are not available to support the 
program.
    (b) Upon fifteen (15) days written notice to the other party, 
either party may temporarily suspend the cooperative agreement, 
pending corrective action or a decision to terminate the cooperative 
agreement. The notice should express the reasons why the agreement 
is being suspended.
    (c) In the event of termination by either party, the Recipient 
shall not be entitled to additional funds or payments except as may 
be required by the Recipient to meet NASA's share of commitments 
which had in the judgment of NASA become firm prior to the effective 
date of termination and are otherwise appropriate. In no event, 
shall these additional funds or payments exceed the amount of the 
next payable milestone billing amount.

[End of provision]

[[Page 50385]]

Sec. 1274.923  Equipment and other property.

Equipment and Other Property (Date)

    (a) NASA cooperative agreements permit acquisition of special 
purpose equipment required for the conduct of research. Acquisition 
of special purpose equipment costing in excess of $5,000 and not 
included in the approved proposal budget requires the prior approval 
of the Grant Officer unless the item is merely a different model of 
an item shown in the approved proposal budget.
    (b) Recipients may not purchase, as a direct cost to the 
cooperative agreement, items of general purpose equipment, examples 
of which include but are not limited to office equipment and 
furnishings, air conditioning equipment, reproduction and printing 
equipment, motor vehicles, and automatic data processing equipment. 
If the Recipient requests an exception, the Recipient shall submit a 
written request for Grant Officer approval, prior to purchase by the 
Recipient, stating why the Recipient cannot charge the general 
purpose equipment to indirect costs.
    (c) Under no circumstances shall cooperative agreement funds be 
used to acquire land or any interest therein, to acquire or 
construct facilities (as defined in 48 CFR (FAR) 45.301), or to 
procure passenger carrying vehicles.
    (d) The government shall have title to equipment and other 
personal property acquired with government funds. Such property 
shall be disposed of pursuant to 48 CFR (FAR) 45.603. The Recipient 
shall have title to equipment and other personal property acquired 
with Recipient funds. Such property shall remain with the Recipient 
at the conclusion of the cooperative agreement.
    (e) Title to Government furnished equipment (including 
equipment, title to which has been transferred to the Government 
prior to completion of the work) will remain with the Government.
    (f) The Recipient shall establish and maintain property 
management standards for Government property and otherwise manage 
such property as set forth in 48 CFR (FAR) 45.5 and 48 CFR (NFS) 
1845.5.
    (g) Recipients shall submit annually a NASA Form 1018, NASA 
Property in the Custody of Contractors, in accordance with the 
instructions on the form, the provisions of 18 CFR (NFS) 1845.71 and 
any supplemental instructions that may be issued by NASA for the 
current reporting period. The original NF 1018 shall be submitted to 
the center Deputy Chief Financial Officer, Finance, with three 
copies sent concurrently to the center Industrial Property Officer. 
The annual reporting period shall be from October 1 of each year 
through September 30 of the following year. The report shall be 
submitted in time to be received by October 31. Negative reports 
(i.e. no reportable property) are required. The information 
contained in the reports in entered into the NASA accounting system 
to reflect current asset values for agency financial statement 
purposes. Therefore, it is essential that required reports be 
received no later than October 31. A final report is required within 
30 days after expiration of the agreement.

[End of provision]


Sec. 1274.924  Civil rights.

Civil Rights (Date)

    Work on NASA cooperative agreements is subject to the provisions 
of Title VI of the Civil Rights Act of 1964 (Public Law 88-352; 42 
U.S.C. 2000d-l), Title IX of the Education Amendments of 1972 (20 
U.S.C. 1680 et seq.), Section 504 of the Rehabilitation Act of 1973, 
as amended (29 U.S.C. 794), the Age Discrimination Act of 1975 (42 
U.S.C. 6101 et seq.), and the NASA implementing regulations (14 CFR 
parts 1250, 1251, 1252 and 1253).

[End of provision]


Sec. 1274.925  Subcontracts.

Subcontracts (Date)

    (a) Recipients are not authorized to issue grants or cooperative 
agreements.
    (b) NASA Grant Officer consent is required for subcontracts over 
$100,000, if not accepted by NASA in the original proposal. The 
Recipient shall provide the following information to the Grant 
Officer:
    (1) A copy of the proposed subcontract.
    (2) Basis for subcontractor selection.
    (3) Justification for lack of competition when competitive bids 
or offers are not obtained.
    (4) Basis for award cost or award price.
    (c) The Recipient shall utilize small business concerns, small 
disadvantaged business concerns, Historically Black Colleges and 
Universities, minority educational institutions, and women-owned 
small business concerns as subcontractors to the maximum extent 
practicable.

[End of provision]


Sec. 1274.926  Clean Air-Water Pollution Control Acts.

Clean Air-Water Pollution Control Acts (Date)

    If this cooperative agreement or supplement thereto is in excess 
of $100,000, the Recipient agrees to notify the Grant Officer 
promptly of the receipt, whether prior or subsequent to the 
Recipient's acceptance of this cooperative agreement, of any 
communication from the Director, Office of Federal Activities, 
Environmental Protection Agency (EPA), indicating that a facility to 
be utilized under or in the performance of this cooperative 
agreement or any subcontract thereunder is under consideration to be 
listed on the EPA ``List of Violating Facilities'' published 
pursuant to 40 CFR part 15. By acceptance of a cooperative agreement 
in excess of $100,000, the Recipient--
    (a) Stipulates that any facility to be utilized thereunder is 
not listed on the EPA ``List of Violating Facilities'' as of the 
date of acceptance;
    (b) Agrees to comply with all requirements of Section 114 of the 
Clean Air Act, as amended (42 U.S.C. 1857 et seq. as amended by 
Public Law 91-604) and Section 308 of the Federal Water Pollution 
Control Act, as amended (33 U.S.C. 1251 et seq. as amended by Public 
Law 92-500) relating to inspection, monitoring, entry, reports and 
information, and all other requirements specified in the 
aforementioned sections, as well as all regulations and guidelines 
issued thereunder after award of and applicable to the cooperative 
agreement; and
    (c) agrees to include the criteria and requirements of this 
clause in every subcontract hereunder in excess of $100,000, and to 
take such action as the Grant Officer may direct to enforce such 
criteria and requirements.

[End of provision]


Sec. 1274.927  Debarment and suspension and Drug-Free Workplace.

Debarment and Suspension and Drug-Free Workplace (Date)

    NASA cooperative agreements are subject to the provisions of 14 
CFR part 1265, Government-wide Debarment and Suspension 
(Nonprocurement) and Government-wide requirements for Drug-Free 
Workplace, unless excepted by 14 CFR 1265.110 or 1265.610.

[End of provision]


Sec. 1274.928  Foreign national employee investigative requirements.

Foreign National Employee Investigative Requirements (Date)

    (a) The Recipient shall submit a properly executed Name Check 
Request (NASA Form 531) and a completed applicant fingerprint card 
(Federal Bureau of Investigation Card FD-258) for each foreign 
national employee requiring access to a NASA Installation. These 
documents shall be submitted to the Installation's Security Office 
at least 75 days prior to the estimated duty date. The NASA 
Installation Security Office will request a National Agency Check 
(NAC) for foreign national employees requiring access to NASA 
facilities. The NASA Form 531 and fingerprint card may be obtained 
from the NASA Installation Security Office.
    (b) The Installation Security Office will request from NASA 
Headquarters, Office of External Relations (Code I), approval for 
each foreign national's access to the Installation prior to 
providing access to the Installation. If the access approval is 
obtained from NASA Headquarters prior to completion of the NAC and 
performance of the cooperative agreement requires a foreign national 
to be given access immediately, the Technical Officer may submit an 
escort request to the Installation's Chief of Security.

[End of provision]


Sec. 1274.929  Restrictions on lobbying.

Restrictions on Lobbying (Date)

    This award is subject to the provisions of 14 CFR part 1271 
``New Restrictions on Lobbying.''

[End of provision]


Sec. 1274.930  Travel and transportation.

Travel and Transportation (Date)

    (a) For travel funded by the government under this agreement, 
Section 5 of the International Air Transportation Fair Competitive 
Practices Act of 1974 (49 U.S.C. 40118) (Fly America Act) requires 
the Recipient to use U.S.-flag air carriers for international air 
transportation of personnel

[[Page 50386]]

and property to the extent that service by those carriers is 
available.
    (b) Department of Transportation regulations, 49 CFR part 173, 
govern Recipient shipment of hazardous materials and other items.

[End of provision]


Sec. 1274.931  Electronic funds transfer payment methods.

Electronic Funds Transfer Payment Methods (Date)

    Payments under this cooperative agreement will be made by the 
Government by electronic funds transfer through the Treasury Fedline 
Payment System (FEDLINE) or the Automated Clearing House (ACH), at 
the option of the Government. After award, but no later than 14 days 
before an invoice is submitted, the Recipient shall designate a 
financial institution for receipt of electronic funds transfer 
payments, and shall submit this designation to the Grant Officer or 
other Government official, as directed.
    (a) For payment through FEDLINE, the Recipient shall provide the 
following information:
    (1) Name, address, and telegraphic abbreviation of the financial 
institution receiving payment.
    (2) The American Bankers Association 9-digit identifying number 
for wire transfers of the financing institution receiving payment if 
the institution has access to the Federal Reserve Communication 
System.
    (3) Payee's account number at the financial institution where 
funds are to be transferred.
    (4) If the financial institution does not have access to the 
Federal Reserve Communications System, name, address, and 
telegraphic abbreviation of the correspondent financial institution 
through which the financial institution receiving payment obtains 
wire transfer activity. Provide the telegraphic abbreviation and 
American Bankers Association identifying number for the 
correspondent institution.
    (b) For payment through ACH, the Recipient shall provide the 
following information:
    (1) Routing transit number of the financial institution 
receiving payment (same as American Bankers Association identifying 
number used for FEDLINE).
    (2) Number of account to which funds are to be deposited.
    (3) Type of depositor account (``C'' for checking, ``S'' for 
savings).
    (4) If the Recipient is a new enrollee to the ACH system, a 
``Payment Information Form,'' SF 3881, must be completed before 
payment can be processed.
    (c) In the event the Recipient, during the performance of this 
cooperative agreement, elects to designate a different financial 
institution for the receipt of any payment made using electronic 
funds transfer procedures, notification of such change and the 
required information specified above must be received by the 
appropriate Government official 30 days prior to the date such 
change is to become effective.
    (d) The documents furnishing the information required in this 
clause must be dated and contain the signature, title, and telephone 
number of the Recipient official authorized to provide it, as well 
as the Recipient's name and contract number.
    (e) Failure to properly designate a financial institution or to 
provide appropriate payee bank account information may delay 
payments of amounts otherwise properly due.

[End of provision]


Sec. 1274.932  Retention and examination of records.

Retention and Examination of Records (Date)

    Financial records, supporting documents, statistical records, 
and all other records (or microfilm copies) pertinent to this 
cooperative agreement shall be retained for a period of 3 years, 
except that records for non-expendable property acquired with 
cooperative agreement funds shall be retained for 3 years after its 
final disposition and, if any litigation, claim, or audit is started 
before the expiration of the 3-year period, the records shall be 
retained until all litigation, claims, or audit findings involving 
the records have been resolved. The retention period starts from the 
date of the submission of the final invoice. The Administrator of 
NASA and the Comptroller General of the United States, or any of 
their duly authorized representatives, shall have access to any 
pertinent books, documents, papers, and records of the Recipient and 
of subcontractors to make audits, examinations, excerpts, and 
transcripts. All provisions of this clause shall apply to any 
subcontractor performing substantive work under this cooperative 
agreement.

[End of provision]


Sec. 1274.933  Summary of recipient reporting responsibilities.

Summary of Recipient Reporting Responsibilities (Date)

    This cooperative agreement requires the recipient to submit a 
number of reports. These reporting requirements are summarized 
below. In the event of a conflict between this provision and other 
provisions of the cooperative agreement requiring reporting, the 
other provisions take precedence.

[The Grant Officer may add/delete reporting requirements as 
appropriate.]

------------------------------------------------------------------------
           Report                   Frequency             Reference
------------------------------------------------------------------------
Report of Joint NASA/         As required.........  Sec.  1274.911
 Recipient Inventions.                               Patent Rights
                                                     (Paragraph (b)(4))
Interim Report of Reportable  Every 12 months.....  Patent Rights--
 Items.                                              Retention by the
                                                     Recipient (Large
                                                     Business)
                                                     (Paragraph
                                                     (e)(3)(i))
Final Report of Reportable    3 months after        Sec.  1274.912
 Items.                        completion.           Patent Rights--
                                                     Retention by the
                                                     Recipient (Large
                                                     Business)
                                                     (Paragraph
                                                     (e)(3)(ii)).
Disclosure of Subject         Within 2 months       Patent Rights
 Inventions.                   after inventor        Retention by the
                               discloses it to       (Large Recipient
                               Recipient.            Business)
                                                     (Paragraph (e)(2))
                                                     or Sec.  1274.913
                                                     Patent Rights--
                                                     Retention by the
                                                     Recipient (Small
                                                     Business)
                                                     (Paragraph (c)(1)).
Election of Title to a        1 year after          Patent Rights--
 Subject Invention.            disclosure of the     Retention by
                               the subject           Recipient (Small
                               invention if a        Business)
                               statutory bar         (Paragraph (c)(2)).
                               exists, otherwise
                               within 2 years.
Listing of Subject            Every 12 months from  Patent Rights--
 Inventions.                   the date of the       Retention by the
                               agreement.            Recipient (Small
                                                     Business)
                                                     (Paragraph
                                                     (f)(5)(i)).
Subject Inventions Final      Prior to close-out    Sec.  1274.913
 Report.                       of the agreement.     Retention by the
                                                     Recipient (Small
                                                     Business)
                                                     (Paragraph
                                                     (f)(5)(ii).
Notification of Decision to   30 days before        Patent Rights--
 Forego Patent Protection.     expiration of         Retention by the
                               response period.      Recipient (Small
                                                     Business)
                                                     (Paragraph (f)(3)).
Notification of a             Promptly upon award   Patent Rights--
 Subcontract Award.            of a subcontract.     Retention by the
                                                     Recipient (Large
                                                     Business)
                                                     (Paragraph (g)(3))
                                                     or Sec.  1274.913
                                                     Patent Rights--
                                                     Retention by the
                                                     Recipient (Small
                                                     Business)
                                                     (Paragraph (g)(3).
Utilization of Subject        Annually............  Patent Rights--
 Invention.                                          Retention by the
                                                     Recipient (Small
                                                     Business)
                                                     (Paragraph (h)).

[[Page 50387]]

 
Notice of Proposed Transfer   Prior to              Sec.  1274.915
 of Technology.                transferring          Restrictions on
                               technology to         Sale or Transfer of
                               foreign firm or       Technology to
                               institution.          Foreign Firms or
                                                     Institutions
                                                     (Paragraph (b)).
Progress Report.............  60 days prior to the  Publications and
                               anniversary date of   Reports: Non-
                               the agreement         Proprietary
                               (except final year).  Research Results
                                                     (Paragraph (d)(1)).
Summary of Research.........  90 days after         Publications and
                               completion of         Reports: Non-
                               agreement.            Proprietary
                                                     Research Results
                                                     (Paragraph (d)(2)).
NASA Form 1018 Property in    Annually by October   Equipment and Other
 Custody of Contractors.       31.                   Property (Paragraph
                                                     (g)).
NASA Form 1018 Property in    60 days after         Equipment and Other
 the Custody of Contractors..  expiration date of    Property (Paragraph
                               agreement.            (g)).
------------------------------------------------------------------------

[End of provision]


Sec. 1274.934  Safety.

Safety (Date)

    (a) The recipient shall act responsibly in matters of safety and 
shall take all reasonable safety measures in performing under this 
grant or cooperative agreement. The recipient shall comply with all 
applicable federal, state, and local laws relating to safety. The 
recipient shall maintain a record of, and will notify the NASA Grant 
Officer of any accident involving death, disabling injury or 
substantial loss of property. The recipient will advise NASA of 
hazards that come to its attention as a result of the work performed 
through routine status reports furnished in compliance with this 
grant or cooperative agreement.
    (b) Where the work under this grant or cooperative agreement 
involves flight hardware, the hazardous aspects, if any, of such 
hardware will be identified, in writing, by the recipient. 
Compliance with this provision by subcontractors shall be the 
responsibility of the recipient.

[End of provision]

Appendix to Part 1274--Listing of Exhibits

Exhibit A to Part 1274--Contract Provisions

    All contracts awarded by a Recipient, including small purchases, 
shall contain the following provisions if applicable:
    1. Equal Employment Opportunity. All contracts shall contain a 
provision requiring compliance with Executive Order 11246, ``Equal 
Employment Opportunity,'' as amended by Executive Order 11375, 
``Amending Executive Order 11246 Relating to Equal Employment 
Opportunity,'' and as supplemented by regulations at 41 CFR Chapter 
60, ``Office of Federal Contract Compliance Programs, Equal 
Employment Opportunity, Department of Labor.''
    2. Copeland ``Anti-Kickback'' Act (18 U.S.C. 874 and 40 U.S.C. 
276c). All contracts in excess of $50,000 for construction or repair 
awarded by Recipients and subRecipients shall include a provision 
for compliance with the Copeland ``Anti-Kickback'' Act (18 U.S.C. 
874), as supplemented by Department of Labor regulations (29 CFR 
part 3, ``Contractors and Subcontractors on Public Building or 
Public Work Financed in Whole or in Part by Loans or Grants from the 
United States''). The Act provides that each Recipient or 
subRecipient shall be prohibited from inducing, by any means, any 
person employed in the construction, completion, or repair of public 
work, to give up any part of the compensation to which he is 
otherwise entitled. The Recipient shall report all suspected or 
reported violations to NASA.
    3. Contract Work Hours and Safety Standards Act (40 U.S.C. 327-
333). Where applicable, all contracts awarded by Recipients in 
excess of $2,000 for construction contracts and in excess of $50,000 
for other contracts, other than contracts for commercial items, that 
involve the employment of mechanics or laborers shall include a 
provision for compliance with Sections 102 and 107 of the Contract 
Work Hours and Safety Standards Act (40 U.S.C. 327-333), as 
supplemented by Department of Labor regulations (29 CFR part 5). 
Under Subsection 102 of the Act, each Recipient shall be required to 
compute the wages of every mechanic and laborer on the basis of a 
standard work week of 40 hours. Work in excess of the standard work 
week is permissible provided that the worker is compensated at a 
rate of not less than 1\1/2\ times the basic rate of pay for all 
hours worked in excess of 40 hours in the work week. Section 107 of 
the Act is applicable to construction work and provides that no 
laborer or mechanic shall be required to work in surroundings or 
under working conditions which are unsanitary, hazardous or 
dangerous. These requirements do not apply to the purchases of 
supplies or materials or articles ordinarily available on the open 
market, or contracts for transportation or transmission of 
intelligence.
    4. Rights to Inventions Made Under a Contract or Agreement. 
Contracts or agreements for the performance of experimental, 
developmental, or research work shall provide for the rights of the 
Federal Government and the Recipient in any resulting invention in 
accordance with 37 CFR part 401, ``Rights to Inventions Made by 
Nonprofit Organizations and Small Business Firms Under Government 
Grants, Contracts and Cooperative Agreements,'' and any implementing 
regulations issued by the awarding agency.
    5. Clean Air Act (42 U.S.C. 7401 et seq.) and the Federal Water 
Pollution Control Act (33 U.S.C. 1251 et seq.), as amended. 
Contracts, other than contracts for commercial items, of amounts in 
excess of $100,000 shall contain a provision that requires the 
Recipient to agree to comply with all applicable standards, orders 
or regulations issued pursuant to the Clean Air Act (42 U.S.C. 7401 
et seq.) and the Federal Water Pollution Control Act as amended (33 
U.S.C. 1251 et seq.). Violations shall be reported to NASA and the 
Regional Office of the Environmental Protection Agency (EPA).
    6. Byrd Anti-Lobbying Amendment (31 U.S.C. 1352). Contractors 
who apply or bid for an award of $100,000 or more shall file the 
required certification. Each tier certifies to the tier above that 
it will not and has not used Federal appropriated funds to pay any 
person or organization for influencing or attempting to influence an 
officer or employee of any agency, a member of Congress, officer or 
employee of Congress, or an employee of a member of Congress in 
connection with obtaining any Federal contract, grant or any other 
award covered by 31 U.S.C. 1352. Each tier shall also disclose any 
lobbying with non-Federal funds that takes place in connection with 
obtaining any Federal award. Such disclosures are forwarded from 
tier to tier up to the Recipient.
    7. Debarment and Suspension (Executive Orders 12549 and 12689). 
No contract shall be made to parties listed on the General Services 
Administration's List of Parties Excluded from Federal Procurement 
or Nonprocurement Programs in accordance with Executive Orders 12549 
and 12689, ``Debarment and Suspension.'' This list contains the 
names of parties debarred, suspended, or otherwise excluded by 
agencies, and contractors declared ineligible under statutory or 
regulatory authority other than Executive Order 12549. Contractors 
with awards that exceed the small purchase threshold shall provide 
the required certification regarding its exclusion status and that 
of its principal employees.

Exhibit B to Part 1274--Reports

1. Individual Procurement Action Report (NASA Form 507)

    The grant officer is responsible for submitting NASA Form 507 
for all cooperative agreement actions.

2. Property Reporting

    As provided in paragraph (g) of 1274.923, an annual NASA Form 
(NF) 1018, NASA Property in the Custody of Contractors, will be 
submitted by October 31 of each year. Negative annual reports are 
required. A final report is required within 30 days after expiration 
of the agreement.

3. Disclosure of Lobbying Activities (SFLLL)

    (a) Grant officers shall provide one copy of each SF LLL 
furnished under 14 CFR

[[Page 50388]]

1271.110 to the Procurement Officer for transmittal to the Director, 
Analysis Division (Code HC).
    (b) Suspected violations of the statutory prohibitions 
implemented by 14 CFR part 1271 shall be reported to the Director, 
Contract Management Division (Code HK).

[FR Doc. 99-23031 Filed 9-15-99; 8:45 am]
BILLING CODE 7510-01-P