FAR 52.245-9—Use and Charges.
Plain-English Summary
FAR 52.245-9, Use and Charges, governs when a contractor may use Government property for nongovernmental purposes and what it must pay for that use. It covers the definitions of rental period and rental time, free use of Government property for certain contract performance, rental use for other work, how rental requests are submitted, when use is prohibited until a charge is agreed, how rental charges are calculated for real property and associated fixtures, how rental charges may be calculated for other Government property, when alternative methodologies may be approved, how rental payments are made and when they are due, interest on late payments, the Government’s reservation of rights despite accepting payment, and the Government’s right to revoke nongovernmental use during the rental period. In practice, this clause is about protecting the Government’s ownership interests while allowing limited contractor use when it benefits contract performance or is otherwise authorized. It requires careful coordination with the Administrative Contracting Officer (ACO), especially before any nongovernmental use begins, because unauthorized use can create payment, compliance, and termination issues. Contractors must track rental time accurately, obtain appraisals when required, and keep supporting records that let the ACO verify charges. Contracting officers must ensure use is properly authorized, charges are reasonable, and Government rights are preserved.
Key Rules
Definitions control charging
The clause relies on the Government Property clause for core definitions and adds specific meanings for rental period and rental time. Rental time includes setup, required maintenance, and restoration time, not just the time the property is actively used.
Free use is limited
The contractor may use Government property without charge only for specifically authorized Government work, approved subcontracts under a Government prime, or other work expressly authorized in writing by the Contracting Officer. Any other nongovernmental use requires rental authority and a charge.
Rental use needs approval
The contractor may use Government property for nongovernmental work only if the Contracting Officer grants written permission or the schedule specifically allows it. Approval to rent does not waive the Government’s right to end the contractor’s use of the property.
No use before charge agreed
The contractor may not begin nongovernmental use, including independent research and development, until the rental charge for real property or the estimated rental charge for other property is agreed upon. Rented property must be used on a non-interference basis.
Real property uses appraisal
For real property and associated fixtures, the contractor must obtain and pay for an independent appraisal that establishes a comparable commercial rental rate. The ACO generally uses that rate unless it is unreasonable, and the appraisal remains usable only for its effective period or one year if no period is stated.
Other property may use formula
For other Government property, the contractor may use either the appraisal method or a formula based on 2 percent of acquisition cost, multiplied by rental time and divided by 720. Rental time must be measured in whole-hour increments, with partial hours rounded up.
Alternative methods may be approved
If the standard monthly or time-based rental methods are unreasonable or impractical, the contractor may request an alternative basis for computing rent. This gives flexibility, but only if the Government agrees.
Payment and interest rules apply
Rent is due 60 days after the rental period ends, unless the contract says otherwise. The contractor must provide detailed records supporting the charge, pay by check to the Treasurer of the United States unless directed otherwise, and pay interest on late amounts at the Renegotiation Board Interest Rate.
Government rights are preserved
Acceptance of rental payment does not waive the Government’s rights for unauthorized use or other contract failures. The Government may also revoke nongovernmental use at any time during the rental period.
Responsibilities
Contractor
Request rental authority in writing, identify the property, propose the rental period, and estimate the charge using the required formula or appraisal method. The contractor must not begin nongovernmental use before the charge is agreed, must use the property on a non-interference basis, must obtain and pay for required appraisals, maintain detailed records of rental time and computation, make timely payment, and pay interest if late.
Administrative Contracting Officer (ACO)
Review rental requests, verify the property and proposed rental period, determine or approve a reasonable rental charge, notify the contractor if an appraisal rate appears unreasonable, accept supporting data for verification, and process or direct payment procedures as specified in the contract.
Contracting Officer
Authorize free use when permitted, approve or deny nongovernmental rental use, specify rental use in the schedule when appropriate, and revoke nongovernmental use when necessary to protect Government interests. The CO also may authorize subcontractor use in writing or through approval of a subcontract.
Government/Agency
Preserve ownership rights in the property, ensure use does not interfere with Government needs, collect rent and interest when due, and retain the right to terminate or revoke nongovernmental use despite prior authorization or receipt of payment.
Practical Implications
Contractors should get written approval before any nongovernmental use starts; using Government property first and asking later is a common compliance problem.
Rental time is broader than active production time, so setup, maintenance, and restoration hours must be tracked and billed correctly.
Real property rentals usually require an independent appraisal, which can take time and cost money, so contractors need to plan well in advance of the intended use date.
The Government can revoke nongovernmental use during the rental period, so contractors should avoid relying on rented property for critical path work without contingency plans.
Acceptance of rent does not cure unauthorized use or other contract violations, so payment alone will not protect a contractor from enforcement action or other remedies.
Official Regulatory Text
As prescribed in 45.107 (c) , insert the following clause: Use and Charges (Apr 2012) (a) Definitions . Definitions applicable to this contract are provided in the clause at 52.245-1 , Government Property. Additional definitions as used in this clause include: Rental period means the calendar period during which Government property is made available for nongovernmental purposes. Rental time means the number of hours, to the nearest whole hour, rented property is actually used for nongovernmental purposes. It includes time to set up the property for such purposes, perform required maintenance, and restore the property to its condition prior to rental (less normal wear and tear). (b) Use of Government property . The Contractor may use the Government property without charge in the performance of- (1) Contracts with the Government that specifically authorize such use without charge; (2) Subcontracts of any tier under Government prime contracts if the Contracting Officer having cognizance of the prime contract- (i) Approves a subcontract specifically authorizing such use; or (ii) Otherwise authorizes such use in writing; and (3) Other work, if the Contracting Officer specifically authorizes in writing use without charge for such work. (c) Rental. If granted written permission by the Contracting Officer, or if it is specifically provided for in the Schedule, the Contractor may use the Government property (except material) for a rental fee for work other than that provided in paragraph (b) of this clause. Authorizing such use of the Government property does not waive any rights of the Government to terminate the Contractor’s right to use the Government property. The rental fee shall be determined in accordance with the following paragraphs. (d) General. (1) Rental requests shall be submitted to the Administrative Contracting Officer (ACO), identify the property for which rental is requested, propose a rental period, and compute an estimated rental charge by using the Contractor’s best estimate of rental time in the formulae described in paragraph (e) of this clause. (2) The Contractor shall not use Government property for nongovernmental purposes, including Independent Research and Development, until a rental charge for real property, or estimated rental charge for other property, is agreed upon. Rented property shall be used only on a non-interference basis. (e) Rental charge .- (1) Real property and associated fixtures . (i) The Contractor shall obtain, at its expense, a property appraisal from an independent licensed, accredited, or certified appraiser that computes a monthly, daily, or hourly rental rate for comparable commercial property. The appraisal may be used to compute rentals under this clause throughout its effective period or, if an effective period is not stated in the appraisal, for one year following the date the appraisal was performed. The Contractor shall submit the appraisal to the ACO at least 30 days prior to the date the property is needed for nongovernmental use. Except as provided in paragraph (e)(1)(iii) of this clause, the ACO shall use the appraisal rental rate to determine a reasonable rental charge. (ii) Rental charges shall be determined by multiplying the rental time by the appraisal rental rate expressed as a rate per hour. Monthly or daily appraisal rental rates shall be divided by 720 or 24, respectively, to determine an hourly rental rate. (iii) When the ACO believes the appraisal rental rate is unreasonable, the ACO shall promptly notify the Contractor. The parties may agree on an alternative means for computing a reasonable rental charge. (iv) The Contractor shall obtain, at its expense, additional property appraisals in the same manner as provided in paragraph (e)(1)(i) if the effective period has expired and the Contractor desires the continued use of property for nongovernmental use. The Contractor may obtain additional appraisals within the effective period of the current appraisal if the market prices decrease substantially. (2) Other Government property . The Contractor may elect to compute the rental charge using the appraisal method described in paragraph (e)(1) of this clause subject to the constraints therein or the following formula in which rental time shall be expressed in increments of not less than one hour with portions of hours rounded to the next higher hour: The hourly rental charge is calculated by multiplying 2 percent of the acquisition cost by the hours of rental time, and dividing by 720. (3) Alternative methodology . The Contractor may request consideration of an alternative basis for computing the rental charge if it considers the monthly rental rate or a time-based rental unreasonable or impractical. (f) Rental payments. (1) Rent is due 60 days following completion of the rental period or as otherwise specified in the contract. The Contractor shall compute the rental due, and furnish records or other supporting data in sufficient detail to permit the ACO to verify the rental time and computation. Payment shall be made by check payable to the Treasurer of the United States and sent to the contract administration office identified in this contract, unless otherwise specified by the Contracting Officer. (2) Interest will be charged if payment is not made by the date specified in paragraph (f)(1) of this clause. Interest will accrue at the "Renegotiation Board Interest Rate" (published in the Federal Register semiannually on or about January 1 st and July 1 st) for the period in which the rent is due. (3) The Government’s acceptance of any rental payment under this clause, in whole or in part, shall not be construed as a waiver or relinquishment of any rights it may have against the Contractor stemming from the Contractor’s unauthorized use of Government property or any other failure to perform this contract according to its terms. (g) Use revocation. At any time during the rental period, the Government may revoke nongovernmental use authorization and require the Contractor, at the Contractor’s expense, to return the property to the Government, restore the property to its prerental condition (less normal wear and tear), or both. (h) Unauthorized use . The unauthorized use of Government property can subject a person to fines, imprisonment, or both, under 18 U.S.C. 641 . (End of clause)