52.241-13
Capital Credits
FAR 52.241-13 ensures the Government receives and tracks capital credits from utility cooperatives, requiring contractors to report and remit these credits according to contract terms.
Overview
FAR 52.241-13, Capital Credits, is a clause used in utility service contracts with cooperatives where the Government is a member. It establishes the Government's right to receive capital credits as any other cooperative member, outlines the contractor's obligation to report accrued credits, and specifies the process for payment of these credits to the Government. The clause ensures transparency and accountability in the handling of capital credits, aligning with the cooperative's bylaws and the contract's terms.
Key Rules
- Government Membership and Entitlement
- The Government, as a cooperative member, is entitled to capital credits under the cooperative's bylaws, and the contractor must honor this obligation.
- Reporting Requirements
- The contractor must provide a written list of accrued capital credits by contract number, year, and delivery point on a specified periodic basis.
- Payment Procedures
- Payments must be made by check to the designated agency, citing the contract number and indicating whether the payment is partial or final, and sent to the Contracting Officer unless otherwise directed.
Responsibilities
- Contracting Officers: Ensure the clause is included in applicable contracts, specify reporting periods, and provide payment instructions.
- Contractors: Track, report, and remit capital credits as required; comply with cooperative bylaws and contract terms.
- Agencies: Oversee compliance, receive payments, and maintain records of capital credits.
Practical Implications
- This clause ensures the Government receives its fair share of capital credits from utility cooperatives, promoting fiscal responsibility.
- Contractors must establish systems for tracking and reporting credits, and timely payment is essential to avoid compliance issues.
- Common pitfalls include incomplete reporting, late payments, or failure to follow specified procedures.