1 September 1997
cost of unloading and transporting the materials or
Government-Furnished Equipment (GFE) and
supplies should be included in the estimate.
included in the estimate.
d. If the materials or supplies are a large
8-8. Materials or Supplies Manufactured
quantity in bulk from which would require extensive
or Produced at the Site
equipment for unloading and hauling, it may be
desirable to prepare a labor and equipment estimate
If it is likely the contractor will manufacture or
for the material handling and delivery.
produce materials or supplies at the project site, a
separate estimate component should be developed for
8-6. Handling and Storage
this work. This estimate should be detailed
equipment, labor, materials, and supplies estimate,
The contractor is usually required to off-load, handle
and should conclude with a unit cost of material or
and stockpile, or warehouse materials on site. These
supply delivered to the stockpile, storage yard, or
costs should be included in the estimate. An item of
other end point.
electronic equipment requiring special low-humidity
storage might have this special cost added to the
8-9. Government-Furnished Materials
direct cost of the equipment. For common items,
(GFM) or Equipment (GFE)
such as construction materials or equipment needing
secure storage, the cost for the security fencing,
On some projects, the Government may provide some
temporary building and material handling should be
of the project materials. Government-furnished
considered as an indirect cost and be included in the
materials and equipment should be estimated in the
job-site overhead cost.
same manner as other materials, except that the
purchase price is not included. The estimate should
include an allowance for transporting handling,
storage from point of delivery and assembly, sales tax
When applicable, state and local sales tax should be
and installation if applicable. There may be special
added to the materials or supplies cost. In some
costs associated with Government-furnished materials
states, material incorporated into Federal construction
such as insurance to cover loss until final installation,
is exempt, but supplies are not. Care should be taken,
special storage costs, or special security measures.
therefore, that the sales tax rate is applied as required.
Note that these materials and procurement costs are
The cost engineer should verify the tax rates and the
normally to be included as part of the total project
applicability of these rates for the project location.
Sales tax is considered to be a direct cost of the
materials and supplies, and also should be applied to