REPLACEMENT OF PERSONAL PROPERTY PURSUANT TO THE EXCHANGE/SALE AUTHORITY

• Citation: 41 CFR Part 102-39
• Sections: 6

§ 102-39.5 Scope.

This part covers the exchange/sale authority and applies to all personal property owned by executive agencies worldwide. Use of “you” throughout this part refers to executive agencies.

§ 102-39.10 Determinations.

Consider using the exchange/sale authority when replacing personal property. Determine whether an exchange or sale will provide a greater return for the Government.

§ 102-39.15 When to offer exchange/sale property to Federal agencies and State Agencies for Surplus Property (SASPs).

You should first solicit:

(a) Federal agencies known to use or distribute such property. If a Federal agency is interested in acquiring and paying for the property, you should arrange for a reimbursable transfer. Reimbursable transfers may also be conducted with the Senate, the House of Representatives, the Architect of the Capitol and any activities under the Architect's direction, the District of Columbia, and mixed-ownership Government corporations. When conducting a reimbursable transfer, you must:

(1) Do so under terms mutually agreeable to you and the recipient;

(2) Not require reimbursement of an amount greater than the estimated fair market value of the transferred property; and

(3) Apply the transfer proceeds in whole or part payment for property acquired to replace the transferred property.

(b) SASPs known to have an interest in acquiring such property. If a SASP is interested in acquiring the property, you should consider selling it to the SASP by negotiated sale at fixed price. The sales proceeds must be applied in whole or part payment for property acquired to replace the transferred property.

§ 102-39.20 Restrictions and prohibitions.

You should not use the exchange/sale authority if the exchange allowance or estimated sales proceeds for the property will be unreasonably low. You must not use the exchange/sale authority for:

(a)(1) The following Federal Supply Classification (FSC) groups of personal property:

(i) 10 Weapons. (This restriction/prohibition does not apply to Class 1005 weapons when conducting exchange/sales with the original equipment manufacturer.)

(ii) 11 Nuclear ordnance.

(iii) 44 Furnace, Steam Plant, and Drying Equipment; and Nuclear Reactors (FSC Class 4470, Nuclear Reactors only).

(iv) 68 Chemical and chemical products.

(v) 84 Clothing, individual equipment, and insignia.

(2) Deviations under paragraph (a)(1) of this section are not required for Department of Defense (DoD) property in any FSC Group when the applicable DoD demilitarization requirements, and any other applicable regulations and statutes, are met.

(b) Materials in the National Defense Stockpile (50 U.S.C. 98-98h) or the Defense Production Act inventory (50 U.S.C. App. 2093).

(c) Nuclear Regulatory Commission-controlled materials unless you meet the requirements of part 102-40 of this subchapter.

(d) Controlled substances, unless you meet the requirements of part 102-40 of this subchapter.

(e) Property with a condition code of scrap except:

(1) Property that had utility and value at the point in time when a determination was made to use the exchange/sale authority; or

(2) Property that was otherwise eligible for exchange/sale but was coded as scrap due to damage.

(f) Property that was originally acquired as excess, forfeited property, or from another source other than new procurement, unless such property has been in official use by the acquiring agency for at least 1 year. You may exchange or sell forfeited property in official use for less than 1 year if the head of your agency determines that a continuing valid requirement exists, but the specific item in use no longer meets that requirement, and that exchange or sale meets all other requirements of this part.

(g) Property that is dangerous to public health or safety without first rendering such property innocuous or providing for adequate safeguards as part of the exchange/sale.

(h) Combat material without demilitarizing it or obtaining a demilitarization waiver or other necessary clearances from the Defense Logistics Agency Disposition Services.

(i) Flight Safety Critical Aircraft Parts (FSCAP) and Critical Safety Items (CSI) unless you meet the provisions of part 102-33 of this subchapter.

(j) Vessels subject to 40 U.S.C. 548.

(k) Aircraft and aircraft parts, unless there is full compliance with all exchange/sale provisions in part 102-33 of this subchapter.

§ 102-39.25 Conditions.

You may use the exchange/sale authority if:

(a) The property exchanged or sold is similar to the property acquired;

(b) The property exchanged or sold is not excess or surplus and you have a continuing need for similar property;

(c) The property exchanged or sold was not acquired for the principal purpose of exchange or sale;

(d) When replacing personal property, the exchange allowance or sales proceeds from the disposition of that property may only be used to offset the cost of the replacement property, not services; and

(e) When replacing personal property by sale, you must use the methods, terms, and conditions of sale, and the forms prescribed in part 102-38 of this subchapter.

§ 102-39.30 Accounting requirements.

Exchange allowances or proceeds of sale under this part will be available during the fiscal year in which the property was exchanged or sold and for one fiscal year thereafter for the purchase of replacement property. Any proceeds of sale not applied to replacement purchases during this time must be deposited in the United States Treasury as miscellaneous receipts. Deviations will not be granted for this section.