32.302
Authority
FAR 32.302 establishes which federal agencies are authorized to issue loan guarantees for defense production, enabling contractors to access financing through designated channels.
Overview
FAR 32.302 outlines the statutory and executive authority for Federal Reserve Banks to act as fiscal agents for the United States in administering loan guarantees for defense production. This authority is rooted in Section 301 of the Defense Production Act of 1950 and further defined by Executive Order 10480. The regulation specifically designates several federal agencies—including the Departments of Defense, Energy, Commerce, Interior, Agriculture, the General Services Administration, and NASA—as "guaranteeing agencies" empowered to participate in these loan guarantee programs. This section establishes the legal foundation for these agencies to facilitate financing for contractors engaged in defense production activities.
Key Rules
- Federal Reserve Banks as Fiscal Agents
- Federal Reserve Banks are authorized to act on behalf of designated agencies in making loan guarantees for defense production.
- Designation of Guaranteeing Agencies
- The President, via Executive Order, has designated specific federal agencies as authorized to issue loan guarantees under the Defense Production Act.
Responsibilities
- Contracting Officers: Must recognize which agencies are authorized to issue loan guarantees and ensure compliance with relevant procedures.
- Contractors: Should identify if their contracts fall under the purview of these guaranteeing agencies for potential loan guarantee support.
- Agencies: Must operate within the authority granted by statute and executive order when issuing loan guarantees.
Practical Implications
- This section clarifies which agencies can facilitate loan guarantees, providing a pathway for contractors to secure financing for defense production.
- Understanding the designated agencies is crucial for contractors seeking loan guarantees and for contracting officers administering such programs.
- Misidentifying the guaranteeing agency or misunderstanding the authority could delay or jeopardize financing for defense-related contracts.