[Federal Register Volume 68, Number 165 (Tuesday, August 26, 2003)]
[Rules and Regulations]
[Pages 51420-51428]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-21485]



[[Page 51419]]

-----------------------------------------------------------------------

Part IV





General Services Administration





-----------------------------------------------------------------------



41 CFR Parts 101-45 and 102-38



Federal Management Regulation; Sale of Personal Property; Final Rule

  Federal Register / Vol. 68, No. 165 / Tuesday, August 26, 2003 / 
Rules and Regulations  

[[Page 51420]]


-----------------------------------------------------------------------

GENERAL SERVICES ADMINISTRATION

41 CFR Parts 101-45 and 102-38

[FPMR Amendment H-211 and FMR Amendment B-3]
RIN 3090-AH10


Federal Management Regulation; Sale of Personal Property

AGENCY: Office of Governmentwide Policy, GSA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The General Services Administration (GSA) is amending the 
Federal Property Management Regulations (FPMR) by revising coverage on 
the sale of personal property and moving it into the Federal Management 
Regulation (FMR). A cross-reference is added to the FPMR to direct 
readers to the coverage in the FMR. The FMR coverage is written in 
plain language to provide agencies with updated regulatory material 
that is easy to read and understand.

DATES: Effective Date: August 26, 2003.

FOR FURTHER INFORMATION CONTACT: The Regulatory Secretariat, Room 4035, 
GS Building, Washington, DC 20405, (202) 208-7312, for information 
pertaining to status or publication schedules. For clarification of 
content, contact Robert Holcombe, Director, Personal Property 
Management Policy Division, (202) 501-3828. Please cite PMR H-211.

SUPPLEMENTARY INFORMATION: 

A. Background

    This final rule updates, streamlines, and clarifies FPMR part 101-
45 and moves most of the part into the FMR. FPMR part 101-45 is revised 
to include a cross reference to the regulations moved to FMR part 102-
38. Section 101-45.101 has been revised to clarify the applicability of 
these regulations to agencies in the executive, legislative, and 
judicial branches of the Federal Government. Section 101-45.307 has 
been revised to reflect Congress' clear intent as stated in the 
codification of title 40 into positive law whereby Congress recognized 
that GSA and other agencies are permitted to retain direct and 
reasonably related indirect expenses of sale from the proceeds of sale 
of surplus personal property. Sections 101-45.309-3, 101-45.309-9, 101-
45.309-12, and 101-45.309-13 remain in part 101-45 but are revised and 
given new section numbers. The final rule is written in a plain 
language question and answer format. This style uses an active voice, 
shorter sentences, and pronouns. A question and its answer combine to 
establish a rule. The employee and the agency must follow the language 
contained in both the question and its answer.
    A proposed rule was published in the Federal Register at 67 FR 
47494, July 19, 2002. All public comments received were considered in 
the formulation of this final rule.

B. Executive Order 12866

    GSA has determined that this final rule is not a significant rule 
for the purposes of Executive Order 12866 of September 30, 1993.

C. Regulatory Flexibility Act

    This final rule is not required to be published in the Federal 
Register for notice and comment; therefore the Regulatory Flexibility 
Act, 5 U.S.C. 601, et seq., does not apply.

D. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because this final rule 
does not impose recordkeeping or information collection requirements, 
or the collection of information from offerors, contractors, or members 
of the public which require the approval of the Office of Management 
and Budget (OMB) under 44 U.S.C. 3501, et seq.

E. Small Business Regulatory Enforcement Fairness Act

    This final rule is exempt from Congressional review prescribed 
under 5 U.S.C. 801 since it relates solely to agency management and 
personnel.

List of Subjects in 41 CFR Parts 101-45 and 102-38

    Government property management, Surplus Government property.

    Dated: July 10, 2003.
Stephen A. Perry,
Administrator of General Services.
    For the reasons set forth in the preamble, GSA amends 41 CFR 
chapters 101 and 102 as follows:

CHAPTER 101--FEDERAL PROPERTY MANAGEMENT REGULATIONS

    1. Part 101-45 is revised to read as follows:

PART 101-45--SALE, ABANDONMENT, OR DESTRUCTION OF PERSONAL PROPERTY

Sec.
101-45.000 Cross-reference to the Federal Management Regulation 
(FMR) (41 CFR chapter 102, parts 102-1 through 102-220).
101-45.001 Demilitarization and decontamination.
101-45.002 Gold.
101-45.003 Vehicle reconditioning.
101-45.004 All terrain vehicles.

    Authority: 40 U.S.C. 545 and 121(c).


Sec.  101-45.000  Cross-reference to the Federal Management Regulation 
(FMR) (41 CFR chapter 102, parts 102-1 through 102-220).

    For information on the sale of personal property previously 
contained in this part, see FMR part 38 (41 CFR part 102-38).


Sec.  101-45.001  Demilitarization and decontamination.

    (a) Dangerous material shall not be disposed of pursuant to part 
102-38 of the Federal Management Regulation (FMR) without first being 
demilitarized or decontaminated when a duly authorized official of the 
executive agency concerned determines this action to be in the interest 
of public health, safety, or security. This may include rendering the 
property innocuous, stripping from it any confidential or secret 
characteristics, or otherwise making it unfit for further use.
    (b) Demilitarization or decontamination of property to be donated 
to public bodies pursuant to part 102-37 of the FMR shall be 
accomplished in a manner so as to preserve so far as possible any 
civilian utility or commercial value of the property.
    (c) Except for those sales otherwise authorized by part 101-42 of 
the Federal Property Management Regulations or other statutes, and for 
specialized sales authorized by the Secretary of Defense, U.S. 
Munitions List items identified as requiring demilitarization shall not 
be reported for public sale without first being demilitarized or 
requiring demilitarization to be a part of the terms and conditions of 
sale. The General Services Administration may refer technical questions 
on demilitarization to the Department of Defense for advice.


Sec.  101-45.002  Gold.

    (a) Gold will be sold in accordance with this section and part 102-
38 of the Federal Management Regulation.
    (b) Sales of gold shall be processed to--
    (1) Use the sealed bid method of sale;
    (2) Require a 20 percent bid deposit;
    (3) Certify all forms of bid deposit and payments; and
    (4) Include in the invitation for bids only gold and such other 
precious and semiprecious materials as may be available for sale at 
that time.
    (c) Each agency generating scrap gold and also having a continuing 
need for fine gold may arrange for the acceptance of scrap gold for 
fine gold with a private

[[Page 51421]]

contractor or the Defense Logistics Agency.


Sec.  101-45.003  Vehicle reconditioning.

    (a) For the purpose of this section, vehicle reconditioning means 
restoring or improving the appearance of any motorized passenger or 
cargo vehicle designed primarily for highway use that is to be disposed 
of through surplus or exchange/sale procedures to the general public.
    (b) To produce the maximum net proceeds, holding agencies shall 
determine, prior to sale, the appropriate level of reconditioning 
commensurate with the estimated fair market value of each vehicle 
scheduled for sale.
    (c) Holding agencies shall arrange for the reconditioning to be 
accomplished just prior to the dates scheduled for public inspection 
and sale.
    (d) For all motor vehicles above salvage condition or value, the 
minimum level of reconditioning required is as follows:
    (1) For the driver and passenger compartment--
    (i) Remove debris;
    (ii) Vacuum floors and seats;
    (iii) Clean dashboard, instrument panel, armrests, door panels, and 
rear shelf;
    (iv) Remove Government stickers or decals without marring surface;
    (v) Clean ashtrays and glove compartment; and
    (vi) Wash windows.
    (2) For the trunk--
    (i) Remove debris;
    (ii) Vacuum; and
    (iii) Position spare tire and tools.
    (3) For the engine compartment--
    (i) Remove debris;
    (ii) Replenish lubricants and coolant to required levels and 
replace missing caps/covers; and
    (iii) Charge battery, if necessary.
    (4) For the exterior--
    (i) Remove Government stickers or decals without marring paint 
finish;
    (ii) Wash exterior, including glass, door jambs, tires, and wheel 
rims/covers; and
    (iii) Inflate tires to recommended pressure.
    (e) Additional reconditioning of selected motor vehicles should be 
considered when such action is expected to substantially improve the 
return on the sale of a vehicle. Generally, a return of $2 for each 
dollar invested should be estimated to justify additional 
reconditioning. Additional reconditioning should include some or all of 
the following:
    (1) For the driver and passenger compartment--
    (i) Shampoo seats, dashboard, headliner, door panels, and floor 
covering;
    (ii) Spray-dye floor carpets and mats;
    (iii) Polish where appropriate;
    (iv) Apply vinyl/rubber reconditioners where appropriate; and
    (v) Replace missing knobs, nameplates, and light lenses and/or 
bulbs.
    (2) For the trunk--
    (i) Wash interior surface; and
    (ii) Spray-dye mats.
    (3) For the engine compartment--
    (i) Clean major surface areas (air cleaner cover, battery, etc.);
    (ii) Wash or steam clean, when necessary;
    (iii) Replace air and fuel filters; and
    (iv) Make minor adjustments and/or replacements to engine systems 
(electrical, fuel, cooling, etc.) to ensure that the vehicle will start 
and idle correctly during inspection by prospective purchasers.
    (4) For the exterior--
    (i) Rotate tires, including the spare, to ensure that the best 
tires are displayed on the vehicle. Properly inflate, clean, and apply 
rubber conditioner or black tire paint to all tires;
    (ii) Wash and blacken wheel splash shields;
    (iii) Apply touch-up paint to nicks and scratches;
    (iv) Wax and polish;
    (v) Replace missing or damaged molding, nameplates, lenses, caps, 
mirrors, antennas, and wheel covers;
    (vi) Repaint exterior of vehicle to original factory color if 
scrapes, dings, etc., are excessive;
    (vii) Repair minor body damage;
    (viii) Apply decorative molding and/or striping to add eye appeal; 
and
    (ix) Obtain State safety and/or emission control inspections, if 
required.
    (f) Reconditioning, when possible, should be accomplished no 
earlier than the calendar week prior to the scheduled sale date.
    (g) Agencies should contact the nearest General Services 
Administration Federal Supply Service Bureau office for information 
regarding the availability of reconditioning services.
    (h) The expense of reconditioning is the responsibility of the 
holding agency.


Sec.  101-45.004  All terrain vehicles.

    (a) Three-wheeled all terrain vehicles (ATVs) may be offered for 
public sale only after they have been mutilated in a manner to prevent 
operational use.
    (b) Four-wheeled ATVs no longer needed by the Government can be 
exchanged with a dealer under the provisions of part 102-39 of the 
Federal Management Regulation. If the unit cannot be exchanged, four-
wheeled ATVs may be offered for public sale only after they have been 
mutilated in a manner to prevent operational use.

CHAPTER 102--FEDERAL MANAGEMENT REGULATION

    2. Part 102-38 is added to subchapter B of chapter 102 to read as 
follows:

PART 102-38--SALE OF PERSONAL PROPERTY

Subpart A--General Provisions
Sec.
102-38.5 What does this part cover?
102-38.10 What is the governing authority for this part?
102-38.15 Who must comply with these sales provisions?
102-38.20 Must we follow the regulations of this part when selling 
all personal property?
102-38.25 To whom do ``we'', ``you'', and their variants refer?
102-38.30 How do we request a deviation from the provisions of this 
part?

Definitions

102-38.35 What definitions apply to this part?

Responsibilities

102-38.40 Who may sell personal property?
102-38.45 What are our responsibilities in selling personal 
property?
102-38.50 What must we do when we suspect violations of 40 U.S.C. 
559, fraud, bribery, or criminal collusion in connection with the 
disposal of personal property?
102-38.55 What must we do when selling personal property?
102-38.60 Who is responsible for the costs of care and handling of 
the personal property before it is sold?
102-38.65 What if we are notified of a Federal requirement for 
surplus personal property before the sale is complete?
102-38.70 May we abandon or destroy personal property either prior 
to or after trying to sell it?
Subpart B--Sales Process

Methods of Sale

102-38.75 How may we sell personal property?
102-38.80 Which method of sale should we use?

Competitive Sales

102-38.85 What is a sealed bid sale?
102-38.90 What is a spot bid sale?
102-38.95 What is an auction?

Negotiated Sales

102-38.100 What is a negotiated sale?
102-38.105 Under what conditions may we negotiate sales of personal 
property?
102-38.110 Who approves our determinations to conduct negotiated 
sales?
102-38.115 What are the specific reporting requirements for 
negotiated sales?

[[Page 51422]]

102-38.120 When may we conduct negotiated sales of personal property 
at fixed prices (fixed price sale)?
102-38.125 May we sell personal property at fixed prices to State 
agencies?

Advertising

102-38.130 Must we publicly advertise sales of Federal personal 
property?
102-38.135 What constitutes a public advertisement?
102-38.140 What must we include in the public notice on sale of 
personal property?

Pre-Sale Activities

102-38.145 Must we allow for inspection of the personal property to 
be sold?
102-38.150 How long is the inspection period?

Offer to Sell

102-38.155 What is an offer to sell?
102-38.160 What must be included in the offer to sell?
102-38.165 Are the terms and conditions in the offer to sell 
binding?
Subpart C--Bids

Buyer Eligibility

102-38.170 May we sell Federal personal property to anyone?
102-38.175 How do we find out if a person or entity has been 
suspended or debarred from doing business with the Government?
102-38.180 May we sell Federal personal property to a Federal 
employee?
102-38.185 May we sell Federal personal property to State or local 
governments?

Acceptance of Bids

102-38.190 What is considered a responsive bid?
102-38.195 Must bidders use authorized bid forms?
102-38.200 Who may accept bids?
102-38.205 Must we accept all bids?
102-38.210 What happens when bids have been rejected?
102-38.215 When may we disclose the bid results to the public?
102-38.220 What must we do when the highest bids received have the 
same bid amount?
102-38.225 What are the additional requirements in the bid process?

Bid Deposits

102-38.230 Is a bid deposit required to buy personal property?
102-38.235 What types of payment may we accept as bid deposits?
102-38.240 What happens to the deposit bond if the bidder defaults 
or wants to withdraw his/her bid?

Late Bids

102-38.245 Do we consider late bids for award?
102-38.250 How do we handle late bids that are not considered?

Modification or Withdrawal of Bids

102-38.255 May we allow a bidder to modify or withdraw a bid?

Mistakes in Bids

102-38.260 Who makes the administrative determinations regarding 
mistakes in bids?
102-38.265 Must we keep records on administrative determinations?
102-38.270 May a bidder protest the determinations made on sales of 
personal property?
Subpart D--Completion of Sale Awards
102-38.275 To whom do we award the sales contract?
102-38.280 What happens when there is no award?

Transfer of Title

102-38.285 How do we transfer title from the Government to the buyer 
for personal property sold?

Payments

102-38.290 What types of payment may we accept?

Disposition of Proceeds

102-38.295 May we retain sales proceeds?
102-38.300 What happens to sales proceeds that we are not authorized 
to retain or that are unused?

Disputes

102-38.305 How do we handle disputes involved in the sale of Federal 
personal property?
102-38.310 Are we required to use the Disputes clause in the sale of 
personal property?
102-38.315 Are we required to use Alternative Disputes Resolution 
for sales contracts?
Subpart E--Other Governing Statutes
102-38.320 Are there other statutory requirements governing the sale 
of Federal personal property?

Antitrust Requirements

102-38.325 What are the requirements pertaining to antitrust laws?
Subpart F--Reporting Requirements
102-38.330 Are there any reports that we must submit to the General 
Services Administration?
102-38.335 Is there any additional personal property sales 
information that we must submit to the General Services 
Administration?
Subpart G--Provisions for State and Local Governments
102-38.340 How may we sell personal property to State and local 
governments?
102-38.345 Do we have to withdraw personal property advertised for 
public sale if a State Agency for Surplus Property wants to buy it?
102-38.350 Are there special provisions for State and local 
governments regarding negotiated sales?
102-38.355 Do the regulations of this part apply to State Agencies 
for Surplus Property (SASPs) when conducting sales?

    Authority: 40 U.S.C. 545 and 40 U.S.C. 121(c).

Subpart A--General Provisions


Sec.  102-38.5  What does this part cover?

    This part prescribes the policies governing the sale of Federal 
personal property, including--
    (a) Surplus personal property that has completed all required 
Federal and/or donation screening; and
    (b) Personal property to be sold under the exchange/sale authority.

    Note to Sec.  102-38.5: You must follow additional guidelines in 
41 CFR parts 101-42 and 101-45 of the Federal Property Management 
Regulations (FPMR) for the sale of personal property that has 
special handling requirements or property containing hazardous 
materials. Additional requirements for the sale of aircraft and 
aircraft parts are provided in part 102-33 of this chapter.

Sec.  102-38.10  What is the governing authority for this part?

    The authority for the regulations in this part governing the sale 
of Federal personal property is 40 U.S.C. 541 through 548, 571, 573 and 
574.


Sec.  102-38.15  Who must comply with these sales provisions?

    All executive agencies must comply with the provisions of this 
part. The legislative and judicial branches are encouraged to follow 
these provisions.


Sec.  102-38.20  Must we follow the regulations of this part when 
selling all personal property?

    Generally, yes, you must follow the regulations of this part when 
selling all personal property; however--
    (a) Materials acquired for the national stockpile or supplemental 
stockpile, or materials or equipment acquired under section 303 of the 
Defense Production Act of 1950, as amended (50 U.S.C. App. 2093) are 
excepted from this part;
    (b) The Maritime Administration, Department of Transportation, has 
jurisdiction over the disposal of vessels of 1,500 gross tons or more 
and determined by the Secretary to be merchant vessels or capable of 
conversion to merchant use;
    (c) Sales made by the Secretary of Defense pursuant to 10 U.S.C. 
2576 (Sale of Surplus Military Equipment to State and Local Law 
Enforcement and Firefighting Agencies) are exempt from these 
provisions; and
    (d) Foreign excess personal property is exempt from these 
provisions.


Sec.  102-38.25  To whom do ``we'', ``you'', and their variants refer?

    Unless otherwise indicated, use of pronouns ``we'', ``you'', and 
their variants throughout this part refer to the holding agency 
responsible for the sale of the property.

[[Page 51423]]

Sec.  102-38.30  How do we request a deviation from the provisions of 
this part?

    Refer to Sec. Sec.  102-2.60 through 102-2.110 of this chapter for 
information on how to obtain a deviation from this part.

Definitions


Sec.  102-38.35  What definitions apply to this part?

    The following definitions apply to this part:
    Bid means a response to an offer to sell that, if accepted, would 
bind the bidder to the terms and conditions of the contract (including 
the bid price).
    Bidder means any entity that is responding to or has responded to 
an offer to sell.
    Estimated fair market value means the selling agency's best 
estimate of what the property would be sold for if offered for public 
sale.
    Identical bids means bids for the same item of property having the 
same total price.
    Personal property means any property, except real property. For 
purposes of this part, the term excludes records of the Federal 
Government, and naval vessels of the following categories:
    (1) Battleships;
    (2) Cruisers;
    (3) Aircraft carriers;
    (4) Destroyers; and
    (5) Submarines.
    State Agency for Surplus Property (SASP) means the agency 
designated under State law to receive Federal surplus personal property 
for distribution to eligible donees within the State as provided for in 
40 U.S.C. 549.
    State or local government means a State, territory, possession, 
political subdivision thereof, or tax-supported agency therein.

Responsibilities


Sec.  102-38.40  Who may sell personal property?

    You may sell personal property as the holding agency or on behalf 
of another agency when so requested, or have the General Services 
Administration, a contractor, or another Federal agency conduct the 
sale for you, provided that only Federal officials authorized by your 
agency approve the sale and bind the United States.


Sec.  102-38.45  What are our responsibilities in selling personal 
property?

    Your responsibilities in selling personal property are to--
    (a) Ensure the sale complies with the provisions of Title 40 of the 
U.S. Code, the regulations of this part, and any other applicable laws;
    (b) Issue internal guidance to promote uniformity of sales 
procedures;
    (c) Assure that officials designated to conduct and finalize sales 
are adequately trained;
    (d) Be accountable for the care and handling of the personal 
property prior to its removal by the buyer; and
    (e) Adjust your property and financial records to reflect the final 
disposition.


Sec.  102-38.50  What must we do when we suspect violations of 40 
U.S.C. 559, fraud, bribery, or criminal collusion in connection with 
the disposal of personal property?

    If you suspect violations of 40 U.S.C. 559, fraud, bribery, or 
criminal collusion in connection with the disposal of personal 
property, you must--
    (a) Refer the violations to the Inspector General of your agency 
and/or the Attorney General, Department of Justice, Washington, DC 
20530, for further investigation. You must cooperate with and provide 
evidence concerning the suspected violation or crime to the 
investigating agency assuming jurisdiction of the matter; and
    (b) Submit to the General Services Administration (GSA), Property 
Management Division (FBP), 1800 F Street, NW., Washington, DC 20406, a 
report of any compliance investigations concerning such violations. The 
report must contain information concerning the noncompliance, including 
the corrective action taken or contemplated, and, for cases referred to 
the Department of Justice, a copy of the transmittal letter. A copy of 
each report must be submitted also to GSA, Personal Property Management 
Policy Division (MTP), 1800 F Street, NW., Washington, DC 20405.


Sec.  102-38.55  What must we do when selling personal property?

    When selling personal property, you must ensure that--
    (a) All sales are made after publicly advertising for bids, except 
as provided for negotiated sales in Sec. Sec.  102-38.100 through 102-
38.125; and
    (b) Advertising for bids must permit full and free competition 
consistent with the value and nature of the property involved.


Sec.  102-38.60  Who is responsible for the costs of care and handling 
of the personal property before it is sold?

    You are responsible for the care and handling costs of the personal 
property until it is removed by the buyer or the buyer's designee. When 
specified in the terms and conditions of sale, you may charge costs for 
storage when the buyer is delinquent in removing the property.


Sec.  102-38.65  What if we are notified of a Federal requirement for 
surplus personal property before the sale is complete?

    Federal agencies have first claim to excess or surplus personal 
property reported to the General Services Administration. When a bona 
fide need for the property exists and is expressed by a Federal agency, 
and when no like item(s) are located elsewhere, you must make the 
property available for transfer to the maximum extent practicable and 
prior to transfer of title to the property.


Sec.  102-38.70  May we abandon or destroy personal property either 
prior to or after trying to sell it?

    (a) Yes, you may abandon or destroy personal property either prior 
to or after trying to sell it, but only when an authorized agency 
official has made a written determination that--
    (1) The personal property has no commercial value; or
    (2) The estimated cost of continued care and handling would exceed 
the estimated sales proceeds.
    (b) In addition to the provisions in paragraph (a) of this section, 
see the regulations at Sec. Sec.  102-36.305 through 102-36.330 of this 
subchapter B that are applicable to the abandonment or destruction of 
personal property in general, and excess personal property in 
particular.

Subpart B--Sales Process

Methods of Sale


Sec.  102-38.75  How may we sell personal property?

    (a) You may sell personal property upon such terms and conditions 
as the head of your agency or designee deems proper to promote 
fairness, openness, and timeliness. In selling personal property, you 
must document the required terms and conditions of each sale, 
including, but not limited to, the following terms and conditions, as 
applicable:
    (1) Inspection.
    (2) Condition and location of property.
    (3) Eligibility of bidders.
    (4) Consideration of bids.
    (5) Bid deposits and payments.
    (6) Submission of bids.
    (7) Bid price determination.
    (8) Title.
    (9) Delivery, loading, and removal of property.
    (10) Default, returns, or refunds.
    (11) Modifications, withdrawals, or late bids.
    (12) Requirements to comply with applicable laws and regulations.
    (13) Certificate of independent price determinations.

[[Page 51424]]

    (14) Covenant against contingent fees.
    (15) Limitation on Government's liability.
    (16) Award of contract.
    (b) Standard government forms (e.g., Standard Form 114 series) may 
be used to document terms and conditions of the sale.
    (c) When conducting and completing a sale through electronic media, 
the required terms and conditions must be included in your electronic 
sales documentation.


Sec.  102-38.80  Which method of sale should we use?

    (a) You may use any method of sale provided the sale is publicly 
advertised and the personal property is sold with full and open 
competition. Exceptions to the requirement for competitive bids for 
negotiated sales (including fixed price sales) are contained in 
Sec. Sec.  102-38.100 through 102-38.125. You must select the method of 
sale that will bring maximum return at minimum cost, considering 
factors such as--
    (1) Type and quantity of property;
    (2) Location of property;
    (3) Potential market;
    (4) Cost to prepare and conduct the sale;
    (5) Available facilities; and
    (6) Sales experience of the selling activity.
    (b) Methods of sale may include sealed bid sales, spot bid sales, 
auctions, or negotiated sales and may be conducted at a physical 
location or through any electronic media that is publicly accessible.

Competitive Sales


Sec.  102-38.85  What is a sealed bid sale?

    A sealed bid sale is a sale in which bid prices are kept 
confidential until bid opening. Bids are submitted either 
electronically or in writing according to formats specified by the 
selling agency, and all bids are held for public disclosure at a 
designated time and place.


Sec.  102-38.90  What is a spot bid sale?

    A spot bid sale is a sale where immediately following the offering 
of the item or lot of property, bids are examined, and awards are made 
or bids rejected on the spot. Bids are either submitted electronically 
or in writing according to formats specified by the selling agency, and 
must not be disclosed prior to announcement of award.


Sec.  102-38.95  What is an auction?

    An auction is a sale where the bid amounts of different bidders are 
disclosed as they are submitted, providing bidders the option to 
increase their bids if they choose. Bids are submitted electronically 
and/or by those physically present at the sale. Normally, the bidder 
with the highest bid at the close of each bidding process is awarded 
the property.

Negotiated Sales


Sec.  102-38.100  What is a negotiated sale?

    A negotiated sale is a sale where the selling price is arrived at 
between the seller and the buyer, subject to obtaining such competition 
as is feasible under the circumstances.


Sec.  102-38.105  Under what conditions may we negotiate sales of 
personal property?

    You may negotiate sales of personal property when--
    (a) The personal property has an estimated fair market value that 
does not exceed $15,000;
    (b) The disposal will be to a State, territory, possession, 
political subdivision thereof, or tax-supported agency therein, and the 
estimated fair market value of the property and other satisfactory 
terms of disposal are obtained by negotiation;
    (c) Bid prices after advertising are not reasonable and re-
advertising would serve no useful purpose;
    (d) Public exigency does not permit any delay such as that caused 
by the time required to advertise a sale;
    (e) The sale promotes public health, safety, or national security;
    (f) The sale is in the public interest under a national emergency 
declared by the President or the Congress. This authority may be used 
only with specific lot(s) of property or for categories determined by 
the Administrator of General Services for a designated period but not 
in excess of three months;
    (g) Selling the property competitively would have an adverse impact 
on the national economy, provided that the estimated fair market value 
of the property and other satisfactory terms of disposal can be 
obtained by negotiation, e.g., sale of large quantities of an 
agricultural product that impact domestic markets; or
    (h) Otherwise authorized by Title 40 of the U.S. Code or other law.


Sec.  102-38.110  Who approves our determinations to conduct negotiated 
sales?

    The head of your agency (or his/her designee) must approve all 
negotiated sales of personal property.


Sec.  102-38.115  What are the specific reporting requirements for 
negotiated sales?

    For negotiated sales of personal property, you must--
    (a) In accordance with 40 U.S.C. 545(e), and in advance of the 
sale, submit to the oversight committees for the General Services 
Administration (GSA) in the Senate and House, explanatory statements 
for each sale by negotiation of any personal property with an estimated 
fair market value in excess of $15,000. You must maintain copies of the 
explanatory statements in your disposal files. No statement is needed 
for negotiated sales at fixed price or for any sale made without 
advertising when authorized by law other than 40 U.S.C. 545; and
    (b) Report annually to GSA, Personal Property Management Policy 
Division (MTP), 1800 F Street, NW., Washington, DC, 20405, within 60 
calendar days after the close of each fiscal year, a listing and 
description of all negotiated sales of personal property with an 
estimated fair market value in excess of $5,000. You may submit the 
report electronically or manually (see Sec.  102-38.330).


Sec.  102-38.120  When may we conduct negotiated sales of personal 
property at fixed prices (fixed price sale)?

    You may sell personal property at fixed prices when the head of 
your agency, or designee, determines in writing that such sale serves 
the best interests of the Government. You must publicize such sale to 
the extent consistent with the value and nature of the property 
involved, and the prices established must reflect the estimated fair 
market value of the property. Property is sold on a first-come, first-
served basis. You may also establish additional terms and conditions 
that must be met by the successful purchaser.


Sec.  102-38.125  May we sell personal property at fixed prices to 
State agencies?

    Yes, before offering to the public, you may offer the property at 
fixed prices (through the State Agencies for Surplus Property) to any 
States, territories, possessions, political subdivisions thereof, or 
tax-supported agencies therein, which have expressed an interest in 
obtaining the property. For additional information, see subpart G of 
this part.

Advertising


Sec.  102-38.130  Must we publicly advertise sales of Federal personal 
property?

    Yes, you must provide public notice of your sale of personal 
property to permit full and open competition.

[[Page 51425]]

Sec.  102-38.135  What constitutes a public advertisement?

    Announcement of the sale using any media that reaches the public 
and is appropriate to the type and value of personal property to be 
sold is considered public advertising. You may also distribute mailings 
or flyers of your offer to sell to prospective purchasers on mailing 
lists. Public notice should be made far enough in advance of the sale 
to ensure adequate notice, and to target your advertising efforts 
toward the market that will provide the best return at the lowest cost.


Sec.  102-38.140  What must we include in the public notice on sale of 
personal property?

    In the public notice, you must provide information necessary for 
potential buyers to participate in the sale, such as--
    (a) Date, time and location of sale;
    (b) General categories of property being offered for sale;
    (c) Inspection period;
    (d) Method of sale (i.e., spot bid, sealed bid, auction);
    (e) Selling agency; and
    (f) Who to contact for additional information.

Pre-Sale Activities


Sec.  102-38.145  Must we allow for inspection of the personal property 
to be sold?

    Yes, you must allow for an electronic or physical inspection of the 
personal property to be sold. You must allow prospective bidders 
sufficient time for inspection. If inspection is restricted to 
electronic inspections only, due to unusual circumstances prohibiting 
physical inspection, you must notify your General Services 
Administration Regional Personal Property Office in writing, with the 
circumstances surrounding this restriction at least 3 days prior to the 
start of the screening period.


Sec.  102-38.150  How long is the inspection period?

    The length of the inspection period allowed depends upon whether 
the inspection is done electronically or physically. You should also 
consider such factors as the circumstances of sale, volume of property, 
type of property, location of the property, and accessibility of the 
sales facility. Normally, you should provide at least 7 calendar days 
to ensure potential buyers have the opportunity to perform needed 
inspections.

Offer to Sell


Sec.  102-38.155  What is an offer to sell?

    An offer to sell is a notice listing the terms and conditions for 
bidding on an upcoming sale of personal property, where prospective 
purchasers are advised of the requirements for a responsive bid and the 
contractual obligations once a bid is accepted.


Sec.  102-38.160  What must be included in the offer to sell?

    The offer to sell must include--
    (a) Sale date and time;
    (b) Method of sale;
    (c) Description of property being offered for sale;
    (d) Selling agency;
    (e) Location of property;
    (f) Time and place for receipt of bids;
    (g) Acceptable forms of bid deposits and payments; and
    (h) Terms and conditions of sale, including any specific 
restrictions and limitations.


Sec.  102-38.165  Are the terms and conditions in the offer to sell 
binding?

    Yes, the terms and conditions in the offer to sell are normally 
incorporated into the sales contract, and therefore binding upon both 
the buyer and the seller once a bid is accepted.

Subpart C--Bids

Buyer Eligibility


Sec.  102-38.170  May we sell Federal personal property to anyone?

    Generally, you may sell Federal personal property to anyone of 
legal age. However, certain persons or entities are debarred or 
suspended from purchasing Federal property. You must not enter into a 
contract with such a person or entity unless your agency head or 
designee responsible for the disposal action determines that there is a 
compelling reason for such an action.


Sec.  102-38.175  How do we find out if a person or entity has been 
suspended or debarred From doing business with the Government?

    Refer to the List of Parties Excluded From Federal Procurement and 
Nonprocurement Programs to ensure you do not solicit from or award 
contracts to these persons or entities. The list is available through 
subscription from the U.S. Government Printing Office, or 
electronically on the Internet at http://epls.arnet.gov. For policies, 
procedures, and requirements for debarring/suspending a person or 
entity from the purchase of Federal personal property, follow the 
procedures in the Federal Acquisition Regulation (FAR) subpart 9.4 (48 
CFR part 9, subpart 9.4).


Sec.  102-38.180  May we sell Federal personal property to a Federal 
employee?

    Yes, you may sell Federal personal property to any Federal employee 
whose agency does not prohibit their employees from purchasing such 
property. However, unless allowed by Federal or agency regulations, 
employees having nonpublic information regarding property offered for 
sale may not participate in that sale (see 5 CFR 2635.703). For 
purposes of this section, the term ``Federal employee'' also applies to 
an immediate member of the employee's household.


Sec.  102-38.185  May we sell Federal personal property to State or 
local governments?

    Yes, you may sell Federal personal property to State or local 
governments. Additional guidelines on sales to State or local 
governments are contained in subpart G of this part.

Acceptance of Bids


Sec.  102-38.190  What is considered a responsive bid?

    A responsive bid is a bid that complies with the terms and 
conditions of the sales offering, and satisfies the requirements as to 
the method and timeliness of the submission. Only responsive bids may 
be considered for award.


Sec.  102-38.195  Must bidders use authorized bid forms?

    No, bidders do not have to use authorized bid forms; however if a 
bidder uses his/her own bid form to submit a bid, the bid may be 
considered only if--
    (a) The bidder accepts all the terms and conditions of the offer to 
sell; and
    (b) Award of the bid would result in a binding contract.


Sec.  102-38.200  Who may accept bids?

    Authorized agency representatives may accept bids for your agency. 
These individuals should meet your agency's requirements for approval 
of Government contracts.


Sec.  102-38.205  Must we accept all bids?

    No, the Government reserves the right to accept or reject any or 
all bids. You may reject any or all bids when such action is 
advantageous to the Government, or when it is in the public interest to 
do so.


Sec.  102-38.210  What happens when bids have been rejected?

    You may re-offer items for which all bids have been rejected at the 
same sale, if possible, or another sale.


Sec.  102-38.215  When may we disclose the bid results to the public?

    You may disclose bid results to the public after the sales award of 
any item or lot of property. On occasions when there is open bidding, 
usually at a spot

[[Page 51426]]

bid sale or auction, all bids are disclosed as they are submitted. No 
information other than names may be disclosed regarding the bidder(s).


Sec.  102-38.220  What must we do when the highest bids received have 
the same bid amount?

    When the highest bids received have the same bid amount, you must 
consider other factors of the sale (e.g., timely removal of the 
property, terms of payment, etc.) that would make one offer more 
advantageous to the Government. However, if you are unable to make a 
determination based on available information, and the Government has an 
acceptable offer, you may re-offer the property for sale, or you may 
utilize random tiebreakers to avoid the expense of reselling the 
property.


Sec.  102-38.225  What are the additional requirements in the bid 
process?

    All sales except fixed price sales must contain a certification of 
independent price determination. If there is suspicion of false 
certification or an indication of collusion, you must refer the matter 
to the Department of Justice or your agency's Office of the Inspector 
General.

Bid Deposits


Sec.  102-38.230  Is a bid deposit required to buy personal property?

    No, a bid deposit is not required to buy personal property. 
However, should you require a bid deposit to protect the Government's 
interest, a deposit of 20 percent of the total amount of the bid is 
generally considered reasonable.


Sec.  102-38.235  What types of payment may we accept as bid deposits?

    In addition to the acceptable types of payments in Sec.  102-
38.290, you may also accept a deposit bond. A deposit bond may be used 
in lieu of cash or other acceptable form of deposit when permitted by 
the offer to sell, such as the Standard Form (SF) 150, Deposit Bond--
Individual Invitation, Sale of Government Personal Property, SF 151, 
Deposit Bond--Annual, Sale of Government Personal Property, and SF 28, 
Affidavit of Individual Surety. For information on how to obtain these 
forms, see Sec.  102-2.135 of subchapter A.


Sec.  102-38.240  What happens to the deposit bond if the bidder 
defaults or wants to withdraw his/her bid?

    (a) When a bid deposit is secured by a deposit bond and the bidder 
defaults, you must issue a notice of default to the bidder and the 
surety company.
    (b) When a bid deposit is secured by a deposit bond and the bidder 
wants to withdraw his/her bid, you should return the deposit bond to 
the bidder.

Late Bids


Sec.  102-38.245  Do we consider late bids for award?

    Consider late bids for award only when the bids were delivered 
timely to the address specified and your agency caused the delay in 
delivering the bids to the official designated to accept the bids.


Sec.  102-38.250  How do we handle late bids that are not considered?

    Late bids that are not considered must be returned to the bidder 
promptly. You must not disclose information contained in returned bids.

Modification or Withdrawal of Bids


Sec.  102-38.255  May we allow a bidder to modify or withdraw a bid?

    (a) Yes, a bidder may modify or withdraw a bid prior to the start 
of the sale or the time set for the opening of the bids. After the 
start of the sale, or the time set for opening the bids, the bidder 
will not be allowed to withdraw his/her bid.
    (b) You may consider late modifications to an otherwise successful 
bid at any time, but only when it makes the terms of the bid more 
favorable to the Government.

Mistakes in Bids


Sec.  102-38.260  Who makes the administrative determinations regarding 
mistakes in bids?

    The administrative procedures for handling mistakes in bids are 
contained in FAR 14.407, Mistakes in Bids (48 CFR 14.407). Your agency 
head, or his/her designee, may delegate the authority to make 
administrative decisions regarding mistakes in bids to a central 
authority, or a limited number of authorities in your agency, who must 
not re-delegate this authority.


Sec.  102-38.265  Must we keep records on administrative 
determinations?

    Yes, you must--
    (a) Maintain records of all administrative determinations made, to 
include the pertinent facts and the action taken in each case. A copy 
of the determination must be attached to its corresponding contract; 
and
    (b) Provide a signed copy of any related determination with the 
copy of the contract you file with the Comptroller General when 
requested.


Sec.  102-38.270  May a bidder protest the determinations made on sales 
of personal property?

    Yes, protests regarding the validity or the determinations made on 
the sale of personal property may be submitted to the Comptroller 
General.

Subpart D--Completion of Sale

Awards


Sec.  102-38.275  To whom do we award the sales contract?

    You must award the sales contract to the bidder with the highest 
responsive bid, unless a determination is made to reject the bid under 
Sec.  102-38.205.


Sec.  102-38.280  What happens when there is no award?

    When there is no award made, you may sell the personal property at 
another sale, or you may abandon or destroy it pursuant to Sec.  102-
36.305 of this subchapter B.

Transfer of Title


Sec.  102-38.285  How do we transfer title from the Government to the 
buyer for personal property sold?

    (a) Generally, no specific form or format is designated for 
transferring title from the Government to the buyer for personal 
property sold. For internal control and accountability, you must 
execute a bill of sale or another document as evidence of transfer of 
title or any other interest in Government personal property. You must 
also ensure that the buyer submits any additional certifications to 
comply with specific conditions and restrictions of the sale.
    (b) For sales of vehicles, you must issue to the purchaser a 
Standard Form (SF) 97, the United States Government Certificate to 
Obtain Title to a Vehicle, or a SF 97A, the United States Government 
Certificate to Obtain a Non-Repairable or Salvage Certificate, as 
appropriate, as evidence of transfer of title. For information on how 
to obtain these forms, see Sec.  102-2.135 of this chapter.

Payments


Sec.  102-38.290  What types of payment may we accept?

    You must adopt a payment policy that protects the Government 
against fraud. Acceptable payments include, but are not limited to, the 
following:
    (a) U.S. currency or any form of credit instrument made payable on 
demand in U.S. currency, e.g., cashier's check, money order. Promissory 
notes and postdated credit instruments are not acceptable.
    (b) Irrevocable commercial letters of credit issued by a United 
States bank payable to the Treasurer of the United States or to the 
Government agency conducting the sale.
    (c) Credit or debit cards.

[[Page 51427]]

Disposition of Proceeds


Sec.  102-38.295  May we retain sales proceeds?

    (a) You may retain that portion of the sales proceeds equal to the 
direct costs and reasonably related indirect costs incurred in selling 
surplus personal property.
    (b) You may retain all sales proceeds when--
    (1) You have statutory authority to retain all proceeds from sales 
of personal property;
    (2) You sold property acquired with non-appropriated funds as 
defined in Sec.  102-36.40 of this subchapter B;
    (3) You sold surplus Government property that was in the custody of 
a contractor or subcontractor and the contract or subcontract 
provisions authorize the proceeds of sale to be credited to the price 
or cost of the contract or subcontract;
    (4) You sold property to obtain replacement property under the 
exchange/sale authority pursuant to part 102-39 of this subchapter B; 
or
    (5) You sold property related to waste prevention and recycling 
programs, under the authority of Section 607 of Public Law 107-67 
(Omnibus Consolidated and Emergency Supplemental Appropriations Act, 
1999, Public Law 107-67, 115 Stat. 514). Consult your General Counsel 
or Chief Financial Officer for guidance on use of this authority.


Sec.  102-38.300  What happens to sales proceeds that we are not 
authorized to retain or that are unused?

    Any sales proceeds that are not retained pursuant to the 
authorities in Sec.  102-38.295 must be deposited as miscellaneous 
receipts in the U.S. Treasury.

Disputes


Sec.  102-38.305  How do we handle disputes involved in the sale of 
Federal personal property?

    First contact your Office of General Counsel. Further guidance can 
be found in the Contract Disputes Act of 1978, as amended (41 U.S.C. 
601-613), and the Federal Acquisition Regulation (FAR) at 48 CFR part 
33.


Sec.  102-38.310  Are we required to use the Disputes clause in the 
sale of personal property?

    Yes, you must ensure the Disputes clause contained in Federal 
Acquisition Regulation (FAR) 52.233-1 (48 CFR part 52) is included in 
all offers to sell and contracts for the sale of personal property.


Sec.  102-38.315  Are we required to use Alternative Disputes 
Resolution for sales contracts?

    No, you are not required to use Alternative Disputes Resolution 
(ADR) for sales contracts. However, you are encouraged to use ADR 
procedures in accordance with the authority and the requirements of the 
Alternative Disputes Resolution Act of 1998 (28 U.S.C. 651--658).

Subpart E--Other Governing Statutes


Sec.  102-38.320  Are there other statutory requirements governing the 
sale of Federal personal property?

    Yes, in addition to Title 40 of the U.S. Code the sale of Federal 
personal property is governed by other statutory requirements, such as 
the Debt Collection Improvement Act of 1996 (Public Law 104-134, sec. 
31001, 110 Stat. 1321-358) and antitrust requirements that are 
discussed in Sec.  102-38.325.

Antitrust Requirements


Sec.  102-38.325  What are the requirements pertaining to antitrust 
laws?

    When the sale of personal property has an estimated fair market 
value of $3 million or more or if the sale involves a patent, process, 
technique, or invention, you must notify the Attorney General of the 
Department of Justice (DOJ) and get DOJ's opinion as to whether the 
sale would give the buyer an unfair advantage in the marketplace and 
violate any antitrust laws. Include in the notification the description 
and location of the property, method of sale and proposed selling 
price, and information on the proposed purchaser and intended use of 
the property.
    You must not complete the sale until you have received confirmation 
from the Attorney General that the proposed transaction would not 
violate any antitrust laws.

Subpart F--Reporting Requirements


Sec.  102-38.330  Are there any reports that we must submit to the 
General Services Administration?

    Yes, there are two sales reports you must submit to the General 
Services Administration (GSA), Personal Property Management Policy 
Division (MTP), 1800 F Street, NW., Washington, DC 20405--
    (a) Negotiated sales report. Within 60 calendar days after the 
close of each fiscal year, you must provide GSA with a listing and 
description of all negotiated sales with an estimated fair market value 
in excess of $5,000 (see Sec.  102-38.115). For each negotiated sale 
that meets this criterion, provide the following:
    (1) Description of the property (including quantity and condition).
    (2) Acquisition cost and date (if not known, estimate and so 
indicate).
    (3) Estimated fair market value (including date of estimate and 
name of estimator).
    (4) Name and address of purchaser.
    (5) Date of sale.
    (6) Gross and net sales proceeds.
    (7) Justification for conducting a negotiated sale.
    (b) Exchange/sale report. Within 90 calendar days after the close 
of each fiscal year, you must provide a summary report to GSA of 
transactions conducted under the exchange/sale authority under part 
102-39 of this subchapter B (see Sec.  102-39.75).


Sec.  102-38.335  Is there any additional personal property sales 
information that we must submit to the General Services Administration?

    Yes, you must report to the General Services Administration's 
(GSA's) Asset Disposition Management System (ADMS), once that 
capability is established, any sales information that GSA deems 
necessary.

Subpart G--Provisions for State and Local Governments


Sec.  102-38.340  How may we sell personal property to State and local 
governments?

    You may sell Government personal property to State and local 
governments through--
    (a) Competitive sale to the public;
    (b) Negotiated sale, through the appropriate State Agency for 
Surplus Property (SASP); or
    (c) Negotiated sale at fixed price (fixed price sale), through the 
appropriate SASP. (This method of sale can be used prior to a 
competitive sale to the public, if desired.)


Sec.  102-38.345  Do we have to withdraw personal property advertised 
for public sale if a State Agency for Surplus Property wants to buy it?

    No, you are not required to withdraw the item from public sale if 
the property has been advertised.


Sec.  102-38.350  Are there special provisions for State and local 
governments regarding negotiated sales?

    Yes, you must waive the requirement for bid deposits and payment 
prior to removal of the property. However, payment must be made within 
30 calendar days after purchase. If payment is not made within 30 days, 
you may charge simple interest at the rate established by the Secretary 
of the Treasury as provided in section 12 of

[[Page 51428]]

the Contract Disputes Act of 1978 (41 U.S.C. 611), from the date of 
written demand for payment.


Sec.  102-38.355  Do the regulations of this part apply to State 
Agencies for Surplus Property (SASPs) when conducting sales?

    Yes, State Agencies for Surplus Property (SASPs) must follow the 
regulations in this part when conducting sales on behalf of the General 
Services Administration of Government personal property in their 
custody.

[FR Doc. 03-21485 Filed 8-25-03; 8:45 am]
BILLING CODE 6820-14-P