[Code of Federal Regulations]

[Title 45, Volume 1]

[Revised as of October 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 45CFR12.9]



[Page 50-52]

 

                        TITLE 45--PUBLIC WELFARE

 

                    SUBTITLE A--DEPARTMENT OF HEALTH

                           AND HUMAN SERVICES

 

PART 12_DISPOSAL AND UTILIZATION OF SURPLUS REAL PROPERTY FOR PUBLIC 

HEALTH PURPOSES--Table of Contents

 

Sec.  12.9  General disposal terms and conditions.



    (a) Surplus real property transfers under this part will be limited 

to public health purposes. Transferees shall be entitled to a public 

benefit allowance in terms of a percentage which will be applied against 

the value of the property to be conveyed. Such an allowance will be 

computed on the basis of benefits to the United States from the use of 

such property for public health purposes. The computation of such public 

benefit allowances will be in accordance with Exhibit A attached hereto 

and made a part hereof.

    (b) A transfer of surplus real property for public health purposes 

is subject to the disapproval of the Administrator within 30 days after 

notice is given to him of the proposed transfer.

    (c) Transfers will be on the following terms and conditions:

    (1) The transferee will be obligated to utilize the property 

continuously in accordance with an approved plan of operation.

    (2) The transferee will not be permitted to sell, lease or sublease, 

rent, mortgage, encumber, or otherwise dispose of the property, or any 

part thereof, without the prior written authorization of the Department.

    (3) The transferee will file with the Department such reports 

covering the utilization of the property as may be required.

    (4) In the event the property is sold, leased or subleased, 

encumbered, disposed of, or is used for purposes other than those set 

forth in the approved plan without the consent of the Department, all 

revenues or the reasonable value of other benefits received by the 

transferee directly or indirectly from such use, as determined by the 

Department, will be considered to have been received and held in trust 

by the transferee for the account of the United States and will be 

subject to the direction and control of the Department. The provisions 

of this paragraph shall not impair or affect the rights reserved to the 

United States in paragraph (c)(6) of this section, or the right of the 

Department to impose conditions to its consent.

    (5) Lessees will be required to carry all perils and liability 

insurance to



[[Page 51]]



protect the Government and the Government's residual interest in the 

property. Transferees will be required to carry such flood insurance as 

may be required by the Department pursuant to Pub. L. 93-234. Where the 

transferee elects to carry insurance against damages to or loss of on-

site property due to fire or other hazards, and where loss or damage to 

transferred Federal surplus real property occurs, all proceeds from 

insurance shall be promptly used by the transferee for the purpose of 

repairing and restoring the property to its former condition, or 

replacing it with equivalent or more suitable facilities. If not so 

used, there shall be paid to the United States that part of the 

insurance proceeds that is attributable to the Government's residual 

interest in the property lost, damaged, or destroyed in the case of 

leases, attributable to the fair market value of the leased facilities.

    (6) With respect to on-site property, in the event of noncompliance 

with any of the conditions of the transfer as determined by the 

Department, title to the property transferred and the right to immediate 

possession shall, at the option of the Department, revert to the 

Government. In the event title is reverted to the United States for 

noncompliance or voluntarily reconveyed, the transferee shall, at the 

option of the Department, be required to reimburse the Government for 

the decrease in value of the property not due to reasonable wear and 

tear or acts of God or attributable to alterations completed by the 

transferee to adapt the property to the public health use for which the 

property was transferred. With respect to leased property, in the event 

of noncompliance with any of the conditions of the lease, as determined 

by the Department, the right of occupancy and possession shall, at the 

option of the Department, be terminated. In the event a leasehold is 

terminated by the United States for noncompliance or is voluntarily 

surrendered, the lessee shall be required at the option of the 

Department to reimburse the Government for the decrease in value of the 

property not due to reasonable wear and tear or acts of God or 

attributable to alterations completed by the lessee to adapt the 

property to the public health use for which the property was leased.



With respect to any reverter of title or termination of leasehold 

resulting from noncompliance, the Government shall, in addition thereto, 

be reimbursed for such costs as may be incurred in recovering title to 

or possession of the property.





Any payments of cash made by the transferee against the purchase price 

of property transferred shall, upon a forfeiture of title to the 

property for breach of condition, be forfeited.

    (7) With respect to off-site property, in the event of noncompliance 

with any of the terms and conditions of the transfer, the unearned 

public benefit allowance shall, at the option of the Department, become 

immediately due and payable or, if the property or any portion thereof 

is sold, leased, or otherwise disposed of without authorization from the 

Department, such sale, lease or sublease, or other disposal shall be for 

the benefit and account of the United States and the United States shall 

be entitled to the proceeds. In the event the transferee fails to remove 

the property or any portion thereof within the time specified, then in 

addition to the rights reserved above, at the option of the Department, 

all right, title, and interest in and to such unremoved property shall 

be retransferred to other eligible applicants or shall be forfeited to 

the United States.

    (8) With respect only to on-site property which has been declared 

excess by the Department of Defense, such declaration having included a 

statement indicating the property has a known potential for use during a 

national emergency, the Department shall reserve the right during any 

period of emergency declared by the President of the United States or by 

the Congress of the United States to the full and unrestricted use by 

the Government of the surplus real property, or of any portion thereof, 

disposed of in accordance with the provisions of this part. Such use may 

be either exclusive or nonexclusive. Prior to the expiration or 

termination of the period of restricted use by the transferee, the 

Government will not be obligated to pay rent or any other fees or 

charges during the period



[[Page 52]]



of emergency, except that the Government will:

    (i) Bear the entire cost of maintenance of such portion of the 

property used by it exclusively or over which it may have exclusive 

possession or control;

    (ii) Pay the fair share, commensurate with the use of the cost of 

maintenance of such surplus real property as it may use nonexclusively 

or over which it may have nonexclusive possession or control;

    (iii) Pay a fair rental for the use of improvements or additions to 

the surplus real property made by the purchaser or lessee without 

Government aid; and

    (iv) Be responsible for any damage to the surplus real property 

caused by its use, reasonable wear and tear, the common enemy and acts 

of God excepted. Subsequent to the expiration or termination of the 

period of restricted use, the obligations of the Government will be as 

set forth in the preceding sentence and, in addition, the Government 

shall be obligated to pay a fair rental for all or any portion of the 

conveyed premises which it uses.

    (9) The restrictions set forth in paragraphs (c) (1) through (7) of 

this section will extend for thirty (30) years for land with or without 

improvements; and for facilities being acquired separately from land 

whether they are for use on-site or off-site, the period of limitations 

on the use of the structures will be equal to their estimated economic 

life. The restrictions set forth in paragraphs (c) (1) through (7) of 

this section will extend for the entire initial lease period and for any 

renewal periods for property leased from the Department.

    (d) Transferees, by obtaining the consent of the Department, may 

abrogate the restrictions set forth in paragraph (c) of this section for 

all or any portion of the property upon payment in cash to the 

Department of an amount equal to the then current fair market value of 

the property to be released, multiplied by the public benefit allowance 

granted at the time of conveyance, divided by the total number of months 

of the period of restriction set forth in the conveyance document and 

multiplied by the number of months that remain in the period of 

restriction as determined by the Department. For purposes of abrogation 

payment computation, the current fair market value shall not include the 

value of any improvements placed on the property by the transferee.

    (e) Related personal property will be transferred or leased as a 

part of the realty and in accordance with real property procedures. It 

will be subject to the same public benefit allowance granted for the 

real property. Where related personal property is involved in an on-site 

transfer, the related personal property may be transferred by a bill of 

sale imposing restrictions for a period not to exceed five years from 

the date of transfer, other terms and conditions to be the same as, and 

made a part of, the real property transaction.