[Code of Federal Regulations]
[Title 48, Volume 3]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR245.607-1]

[Page 340]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                    CHAPTER 2--DEPARTMENT OF DEFENSE
 
PART 245--GOVERNMENT PROPERTY--Table of Contents
 
  Subpart 245.6--Reporting, Redistribution, and Disposal of Contractor 
                                Inventory
 
Sec. 245.607-1  General.

    (a)(i) The contractor may request a pre-inventory scrap 
determination, made by the plant clearance officer after an on-site 
survey, if inventory is considered without value except for scrap. If 
approved, the contractor may make a single descriptive entry on an 
inventory schedule, generally describing the property and indicating its 
approximate total cost. The plant clearance officer will establish a 
plant clearance case and perform limited screening.
    (ii) If the contractor has an approved scrap procedure, routine 
disposal of production scrap and spoilage is authorized, and a plant 
clearance case is unnecessary. The contractor may similarly dispose of 
worn, broken, mutilated, or otherwise rejected parts from overhaul and 
repair contracts with the approval of the plant clearance officer.
    (iii) In addition to segregating scrap to maximize proceeds, the 
contractor may also consolidate sales of Government and contractor scrap 
if approved by the plant clearance officer. When a consolidated sale is 
approved, the plant clearance officer shall waive the scrap warranty 
required at 245.607-70.
    (iv) When a contractor's approved scrap procedure does not require 
physical segregation of Government and contractor scrap, the plant 
clearance officer shall ensure the proceeds of scrap sale are equitably 
distributed.