[Code of Federal Regulations]
[Title 14, Volume 5]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 14CFR1274.102]

[Page 463-464]
 
                     TITLE 14--AERONAUTICS AND SPACE
 
                   CHAPTER V--NATIONAL AERONAUTICS AND
                          SPACE ADMINISTRATION
 
PART 1274_COOPERATIVE AGREEMENTS WITH COMMERCIAL FIRMS--Table of Contents
 
                         Subpart 1274.1_General
 
Sec.  1274.102  Scope.

    (a) The business relationship between NASA and the recipient of a 
cooperative agreement differs from the relationship that exists between 
NASA and the recipient of a grant. Under the auspices of a grant, there 
is very little involvement and interaction between NASA and the grantee 
(other than a few administrative, funding, and reporting requirements, 
or in some cases matching of funds). Under a cooperative agreement, 
because of its substantial involvement, NASA assumes a higher degree of 
responsibility for the technical performance outcomes and associated 
financial costs of research activities. In some cooperative agreement 
projects, NASA may be required to indemnify the recipient (to the extent 
authorized by Congress). While the principal purpose of NASA's 
involvement and commitment of resources is to stimulate or support 
research activity, a major incentive for involvement by commercial firms 
(particularly where costs are shared) is the profit potential from 
marketable products expected to result from the cooperative agreement 
project.
    (b) Cooperative agreements (in areas or research relevant to NASA's 
mission) are ordinarily entered into with commercial firms to--
    (1) Support research and development;
    (2) Provide technology transfer from the Government to the 
recipient; or
    (3) Develop a capability among U.S. firms to potentially enhance 
U.S. competitiveness.
    (c) Projects that normally result in a cooperative agreement award 
to a commercial entity are projects that:
    (1) Are not intended for the direct benefit of NASA;
    (2) Are expected to benefit the general public;
    (3) Require substantial cost sharing; and
    (4) Have commercial applications and profit generating potential.
    (d) The principal purpose of cooperative agreements is to stimulate 
research to benefit the general public

[[Page 464]]

through the criteria stated in paragraphs (a) through (c) of this 
section. Since all research activities must be within NASA's authorized 
expenditure of appropriations, there may be instances where NASA can 
derive incidental use or benefits while preserving the principal purpose 
of the cooperative agreement. However, a careful balance must be 
established and maintained in the cooperative agreement's technical and 
business objectives, so that the principal purpose of the project serves 
to benefit the general public (i.e., technology will transfer from the 
Government to the public and the commercial partner expects a marketable 
product to result). If a cooperative agreement is awarded when the 
proper award instrument should have been a contract (because the primary 
purpose of the award is for the direct benefit of NASA), the cooperative 
agreement award can be protested. Thus, before pursuing any incidental 
benefits that materialize under a cooperative agreement, NASA Centers 
should ensure that the advice of legal counsel is obtained.