E. Scrap Procedures

Comment: A respondent recommended deleting DFARS 252.245-70XX(j)(1), Contractor with an approved scrap procedure, in its entirety because the scrap procedures are typically incorporated within the contractor's property management system.

DoD Response: DoD agrees that a separate approval of contractor scrap procedures is neither practical nor necessary; however, the basic minimum requirements of an adequate scrap procedure are integral to proper application of the clause. Accordingly, the language referring to scrap procedure approvals at DFARS 252.245-70XX(j)(1) has been deleted from the final rule; the remaining language has been retained at paragraph (h) of 252.245-7004.

Comment: In reference to DFARS 252.245-70XX(j)(i)(ii), a respondent recommended retaining the current language found in DFARS 245.610-3(1)(iv)(B), as follows: "When commingling is approved, the net proceeds for contractors with an approved scrap procedure will ensure (that sales) proceeds are appropriately applied to an overhead account."

DoD Response: While the requirement is still relevant, it is a normal part of a property administrator's oversight function; therefore, the language is more suitable to internal DoD component guidance, e.g., DCMA instructions.

Comment: A respondent recommended deleting the requirement for a scrap warranty at DFARS 252.245-70XX(j)(3).

DoD Response: The referenced language has been modified to allow Government discretion in requiring a scrap warranty.

Comment: A respondent recommended moving the requirements of DFARS 252.245-70XX(k), Disposal of contractor inventory for NATO cooperative services, to DFARS part 245 or providing clarification that its requirements are a Government responsibility.

DoD Response: The language has been deleted from the final rule clause, as DoD support to NATO cooperative projects is already covered under DFARS 225.871.