[Federal Register: December 27, 1999 (Volume 64, Number 247)]
[Rules and Regulations]
[Page 72448-72450]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr27de99-31]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 16, 48, and 52
[FAC 97-15; FAR Case 98-017; Item IX]
RIN 9000-AI35
Federal Acquisition Regulation; Review of Award Fee
Determinations (Burnside-Ott)
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) have agreed on a final rule
amending the Federal Acquisition Regulation (FAR). The amendment
implements rulings of the United States Court of Appeals and the United
States Court of Federal Claims. The rulings are that the Contract
Disputes Act applies to all disputes arising under Government
contracts, unless a more specific statute provides for other remedies.
DATES: Effective Date: February 25, 2000.
Applicability Date: The FAR, as amended by this rule, is applicable
to solicitations issued on or after February 25, 2000.
FOR FURTHER INFORMATION CONTACT: The FAR Secretariat, Room 4035, GS
Building, Washington, DC, 20405, (202) 501-4755, for information
pertaining to status or publication schedules. For clarification of
content, contact Mr. Ralph De Stefano, Procurement Analyst, at (202)
501-1758. Please cite FAC 97-15, FAR case 98-017.
SUPPLEMENTARY INFORMATION:
A. Background
DoD, GSA, and NASA published a proposed rule in the Federal
Register at 64 FR 24472, May 6, 1999, and received no comments. This
final rule amends the FAR to implement the rulings of the United States
Court of Appeals in Burnside-Ott Aviation Training Center v. Dalton,
Secretary of the Navy, 107 F.3d 854 (Fed. Cir. 1997) and of the United
States Court of Federal Claims in Rig Masters, Inc. v. The United
States, 42 (Fed. Cl. 369 (1998)). The rulings are that the Contract
Disputes Act applies to all disputes arising under Government
contracts, unless a more specific statute provides for other remedies.
The rule amends FAR 16.405-2(a) by deleting the statement that award-
fee determinations are not subject to the disputes clause of the
contract and inserting a statement that such determinations and the
methodology for determining award fee are unilateral decisions made
solely at the discretion of the Government. In addition, the rule
amends--
(a) FAR 16.406 to conform with the newly revised 16.405-2(a);
(b) FAR Part 48 to--
(1) Remove references to the Contract Disputes Act;
(2) State that certain unilateral decisions are made solely at the
discretion of the Government; and
(3) Insert a statement that the contracting officer's determination
of the duration of the sharing period and the contractor's sharing rate
is one such decision;
(c) The clauses at 52.248-1 and 52.248-3 to conform with the newly
revised Part 48; and
(d) The clauses at 52.219-10, 52.219-26, and 52.226-1 to remove
exemptions to the Contract Disputes Act. Also, we made editorial
revisions to all affected sections for plain language purposes.
This rule was not subject to Office of Management and Budget review
under Section 6(b) of Executive Order 12866, Regulatory Planning and
Review, dated September 30, 1993. This rule is not a major rule under 5
U.S.C. 804.
B. Regulatory Flexibility Act
The Department of Defense, the General Services Administration, and
the National Aeronautics and Space Administration certify that this
final rule will not have a significant economic impact on a substantial
number of small entities within the meaning of the Regulatory
Flexibility Act, 5 U.S.C. 601, et seq., because the rule implements
court rulings relating to a statute that has been in effect since 1979.
This final rule retains the government's unilateral decision
[[Page 72449]]
authority in these matters. Therefore, we have not performed a
Regulatory Flexibility Analysis. We did not receive any comments
regarding this determination as a result of publication of the proposed
rule in the Federal Register at 64 FR 24472, May 6, 1999.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose information collection requirements that require
the approval of the Office of Management and Budget under 44 U.S.C.
3501, et seq.
List of Subjects in 48 CFR Parts 16, 48, and 52
Government procurement.
Dated: December 20, 1999.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.
Therefore, DoD, GSA, and NASA amend 48 CFR Parts 16, 48, and 52 as
set forth below:
1. The authority citation for 48 CFR Parts 16, 48, and 52 continues
to read as follows:
Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 16--TYPES OF CONTRACTS
2. Amend section 16.405-2 by revising the last sentence of
paragraph (a) to read as follows:
16.405-2 Cost-plus-award-fee contracts.
(a) * * * This determination and the methodology for determining
the award fee are unilateral decisions made solely at the discretion of
the Government.
* * * * *
3. Amend section 16.406 in paragraphs (a), (b), and the
introductory text of paragraph (e) by removing ``The contracting
officer shall insert'' and adding ``Insert'' in their place; and by
revising paragraph (e)(3) to read as follows:
16.406 Contract clauses.
* * * * *
(e) * * *
(3) Expressly provides that the award amount and the award-fee
determination methodology are unilateral decisions made solely at the
discretion of the Government.
PART 48--VALUE ENGINEERING
4. Amend section 48.103 by revising the introductory text of
paragraph (c); and by adding a new paragraph (c)(4) to read as follows:
48.103 Processing value engineering change proposals.
* * * * *
(c) The following Government decisions are unilateral decisions
made solely at the discretion of the Government:
* * * * *
(4) The contracting officer's determination of the duration of the
sharing period and the contractor's sharing rate.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
5. Amend section 52.219-10 by revising the date of the clause; in
the first sentence of paragraph (b) by adding ``Contracting Officer
to'' following the opening bracket; and by revising the last sentence
of paragraph (b) to read as follows:
52.219-10 Incentive Subcontracting Program.
* * * * *
INCENTIVE SUBCONTRACTING PROGRAM (FEB 2000)
* * * * *
(b) * * * Determinations under this paragraph are unilateral
decisions made solely at the discretion of the Government.
* * * * *
6. Amend section 52.219-26 by revising the date of the clause and
the last sentence of paragraph (b) to read as follows:
52.219-26 Small Disadvantaged Business Participation Program--
Incentive Subcontracting.
* * * * *
SMALL DISADVANTAGED BUSINESS PARTICIPATION PROGRAM--INCENTIVE
SUBCONTRACTING (FEB 2000)
* * * * *
(b) * * * Determinations under this paragraph are unilateral
decisions made solely at the discretion of the Government.
* * * * *
7. Amend section 52.226-1 by revising the date of the clause and
paragraph (d) to read as follows:
52.226-1 Utilization of Indian Organizations and Indian-Owned Economic
Enterprises.
* * * * *
UTILIZATION OF INDIAN ORGANIZATIONS AND INDIAN-OWNED ECONOMIC
ENTERPRISES (FEB 2000)
* * * * *
(d) The Contracting Officer, subject to the terms and conditions
of the contract and the availability of funds, will authorize an
incentive payment of 5 percent of the amount paid to the
subcontractor. The Contracting Officer will seek funding in
accordance with agency procedures.
(End of clause)
8. Amend section 52.248-1--
a. By revising the date of the clause;
b. In paragraphs (e)(1) and (e)(2), by removing ``shall'' each time
it is used (3 times and 1 time, respectively) and adding ``will'' in
its place;
c. By revising the last sentence of paragraph (e)(3);
d. By revising paragraph (j); and
e. In Alternate II, by revising the date and adding a sentence to
the end of paragraph (a) to read as follows:
52.248-1 Value Engineering.
* * * * *
VALUE ENGINEERING (FEB 2000)
* * * * *
(e) * * *
(3) * * * The decision to accept or reject all or part of any
VECP is a unilateral decision made solely at the discretion of the
Contracting Officer.
* * * * *
(j) Collateral savings. If a VECP is accepted, the Contracting
Officer will increase the instant contract amount, as specified in
paragraph (h)(5) of this clause, by a rate from 20 to 100 percent,
as determined by the Contracting Officer, of any projected
collateral savings determined to be realized in a typical year of
use after subtracting any Government costs not previously offset.
However, the Contractor's share of collateral savings will not
exceed the contract's firm-fixed-price, target price, target cost,
or estimated cost, at the time the VECP is accepted, or $100,000,
whichever is greater. The Contracting Officer will be the sole
determiner of the amount of collateral savings.
* * * * *
Alternate II (Feb 2000). * * *
(a) * * * The decision on which rate applies is a unilateral
decision made solely at the discretion of the Government.
* * * * *
9. Amend section 52.248-3 by revising the date of the clause; in
paragraphs (e)(1) and (e)(2) by removing ``shall'' each time it is used
(3 times and 1 time, respectively) and adding ``will'' in its place;
and by revising the last sentence of paragraph (e)(3) and paragraph (g)
to read as follows:
52.248-3 Value Engineering--Construction.
* * * * *
VALUE ENGINEERING--CONSTRUCTION (FEB 2000)
* * * * *
(e) * * *
(3) * * * The decision to accept or reject all or part of any
VECP is a unilateral decision made solely at the discretion of the
Contracting Officer.
* * * * *
(g) Collateral savings. If a VECP is accepted, the Contracting
Officer will increase the instant contract amount by 20
[[Page 72450]]
percent of any projected collateral savings determined to be
realized in a typical year of use after subtracting any Government
costs not previously offset. However, the Contractor's share of
collateral savings will not exceed the contract's firm-fixed-price
or estimated cost, at the time the VECP is accepted, or $100,000,
whichever is greater. The Contracting Officer is the sole determiner
of the amount of collateral savings.
* * * * *
[FR Doc. 99-33438 Filed 12-23-99; 8:45 am]
BILLING CODE 6820-EP-P