[Federal Register Volume 61, Number 246 (Friday, December 20, 1996)]
[Rules and Regulations]
[Pages 67420-67422]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-32007]
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DEPARTMENT OF DEFENSE
48 CFR Parts 19 and 52
[FAC 90-43, FAR Case 95-028, Item VII]
RIN 9000-AH34
Federal Acquisition Regulation; Minority Small Business and
Capital Ownership
AGENCIES: Department of Defense (DOD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Interim rule with request for comment.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council have agreed to an interim rule that
amends the Federal Acquisition Regulation (FAR) to reflect changes to
the Small Business Administration's (SBA) regulations at 13 CFR Parts
121 and 124, which address the Minority Small Business and Capital
Ownership Development Program. The rule clarifies eligibility and
procedural requirements for procurements under the 8(a) Program. This
regulatory action was not subject to Office of Management and Budget
review under Executive Order 12866, dated September 30, 1993, and is
not a major rule under 5 U.S.C. 804.
DATES: Effective Date: December 20, 1996.
Comment Date: Comments should be submitted to the FAR Secretariat
at the address shown below on or before February 18, 1997 to be
considered in the formulation of a final rule.
ADDRESSES: Interested parties should submit written comments to:
General Services Administration, FAR Secretariat (MVRS), 18th & F
Streets, NW, Room 4035, Attn: Ms. Beverly Fayson, Washington, DC 20405.
Please cite FAC 90-43, FAR case 95-028, in all correspondence
related to this case.
FOR FURTHER INFORMATION CONTACT: Ms. Linda Klein at (202) 501-3775 in
reference to this FAR case. For general information, contact the FAR
Secretariat, Room 4035, GS Building, Washington, DC 20405 (202) 501-
4755. Please cite FAC 90-43, FAR case 95-028.
SUPPLEMENTARY INFORMATION:
A. Background
On June 7, 1995, SBA published changes in their regulations at 13
CFR Parts 121 and 124, which cover the Minority Small Business and
Capital Ownership Development Program (60 FR 29969). As a result of
these modifications, the FAR has some inconsistencies regarding who is
eligible for a particular 8(a) procurement. Amended FAR sections
include: 19.801, 19.804-2, 19.804-3, 19.805-1, 19.805-2, 19.808-1,
19.809, 19.811-1, 19.811-3, 52.219-1, 52.219-11 (Alternate I), 52.219-
12 (Alternate I), 52.219-17, and 52.219-18 (Alternate II).
B. Regulatory Flexibility Act
This interim rule is not expected to 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. This rule does
not impose any new requirements on contractors. The rule amends the FAR
to reflect changes at 13 CFR 121 and 124 designed to streamline the
operation of the 8(a) program and to ease certain restrictions
perceived to be burdensome on Program Participants. The FAR is changed
to eliminate inconsistencies with respect to who is eligible for
particular 8(a) procurements; to eliminate obsolete definitions; and to
eliminate coverage on certain aspects of the 8(a) program that are
obsolete. An Initial Regulatory Flexibility Analysis has, therefore,
not been performed. Comments are invited from small businesses and
other interested parties. Comments from small entities concerning the
affected FAR parts also will be considered in accordance with 5 U.S.C.
610. Such comments must be submitted separately and cite 5 U.S.C
[[Page 67421]]
601, et seq. (FAR case 95-028), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the changes to
the FAR do not impose recordkeeping or information collection
requirements, or collections of information from offerors, contractors,
or members of the public which require the approval of the Office of
Management and Budget under 44 U.S.C. 3501, et seq.
D. Determination To Issue an Interim Rule
A determination has been made under the authority of the Secretary
of Defense (DOD), the Administrator of General Services (GSA), and the
Administrator of the National Aeronautics and Space Administration
(NASA) that urgent and compelling reasons exist to promulgate this
interim rule without prior opportunity for public comment. This action
is necessary in order to implement the changes in the Small Business
Administration (SBA) Minority Small Business and Capital Ownership
Development Program that are applicable for all 8(a) requirements
accepted by the SBA on or after August 7, 1995. However, pursuant to
Public Law 98-577 and FAR 1.501, public comments received in response
to this interim rule will be considered in the formulation of the final
rule.
List of Subjects in 48 CFR Parts 19 and 52
Government procurement.
Dated: December 11, 1996.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.
Therefore, 48 CFR Parts 19 and 52 are amended as set forth below:
1. The authority citation for 48 CFR Parts 19 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 19--SMALL BUSINESS PROGRAMS
19.801 [Reserved]
2. Section 19.801 is removed and reserved.
3. Section 19.804-2 is amended by revising paragraph (b) and adding
(c) to read as follows:
19.804-2 Agency offering.
* * * * *
(b)(1) An agency offering a construction requirement should submit
it to the SBA District Office for the geographical area where the work
is to be performed.
(2) Sole source requirements, other than construction, should be
forwarded directly to the district office that services the nominated
firm. If the contracting officer is not nominating a specific firm, the
offering letter should be sent to SBA Headquarters, Office of Minority
and Capital Ownership Development, 409 3rd Street, SW, Washington, DC
20416.
(c) In order to ensure consistency and uniformity, all requirements
for 8(a) competition shall be offered to and processed by the Division
of Business Development, SBA Headquarters. All requirements, including
construction, shall be synopsized in the Commerce Business Daily by the
cognizant procuring agency. For construction, the synopsis shall
include the geographical area of the competition as determined by the
Assistant Administrator, Division of Business Development, in
consultation with the local SBA district office where the work is to be
performed.
19.804-3 [Amended]
4. Section 19.804-3 is amended by removing paragraph (c).
5. Section 19.805-1 is amended by redesignating paragraph (c) as
(d) and revising the last sentence, and by adding a new paragraph (c).
The added and revised text reads as follows:
19.805-1 General.
* * * * *
(c) A proposed 8(a) requirement with an estimated value exceeding
the applicable competitive threshold amount shall not be divided into
several requirements for lesser amounts in order to use 8(a) sole
source procedures for award to a single firm.
(d) * * * Agency recommendations for competition below the
threshold may be included in the offering letter or may be submitted by
separate correspondence to the SBA Headquarters.
6. Section 19.805-2 is amended by revising the introductory text of
paragraph (c) to read as follows:
19.805-2 Procedures.
* * * * *
(c) The SBA will determine the eligibility of the firms for award
of the contract. Eligibility will be determined by the SBA as of the
time of submission of initial offers which include price. Eligibility
is based on Section 8(a) Program criteria.
* * * * *
7. Section 19.808-1(b) is revised to read as follows:
19.808-1 Sole source.
* * * * *
(b) The SBA should participate, whenever practicable, in
negotiating the contracting terms. When mutually agreeable, the SBA may
authorize the contracting activity to negotiate directly with the 8(a)
contractor. Whether or not direct negotiations take place, the SBA is
responsible for approving the resulting contract before award.
8. Section 19.809 is amended by revising the fourth sentence to
read as follows:
19.809 Preaward considerations.
* * * Within 15 working days of the receipt of the referral or a
longer period agreed to by the SBA and the contracting activity, the
SBA local district office that services the 8(a) firm will advise the
contracting officer as to the SBA's willingness to certify its
competency to perform the contract using the 8(a) concern in question
as its subcontractor. * * *
19.811-1 [Amended]
9. Section 19.811-1 is amended by removing paragraph (b)(5).
10. Section 19.811-3 is amended by revising paragraphs (a), (b),
and (d)(1); by removing (d)(2); and by redesignating (d)(3) as (d)(2),
and in newly-designated (d)(2) by revising ``Alternate III'' to read
``Alternate II''. The revised text reads as follows:
19.811-3 Contract clauses.
(a) The contracting officer shall insert the clause at 52.219-11,
Special 8(a) Contract Conditions, in contracts between the SBA and the
agency when the acquisition is accomplished using the procedures of
19.811-1(a) and (b).
(b) The contracting officer shall insert the clause at 52.219-12,
Special 8(a) Subcontract Conditions, in contracts between the SBA and
its 8(a) contractor when the acquisition is accomplished using the
procedures of 19.811-1(a) and (b).
* * * * *
(d) * * *
(1) The clause at 52.219-18 with its Alternate I will be used when
competition is to be limited to 8(a) concerns within one or more
specific SBA districts pursuant to 19.804-2.
* * * * *
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
11. Section 52.219-1 is amended by revising the provision date, and
in paragraph (c) by adding, in alphabetical order, the definition for
``Joint venture'' to read as follows:
[[Page 67422]]
52.219-1 Small Business Program Representations.
* * * * *
SMALL BUSINESS PROGRAM REPRESENTATIONS (DEC 1996)
* * * * *
(c) Definitions. Joint venture, for purposes of a small
disadvantaged business (SDB) set-aside or price evaluation
preference (as prescribed at 13 CFR 124.321), is a concern that is
owned and controlled by one or more socially and economically
disadvantaged individuals entering into a joint venture agreement
with one or more business concerns and is considered to be
affiliated for size purposes with such other concern(s). The
combined annual receipts or employees of the concerns entering into
the joint venture must meet the applicable size standard
corresponding to the SIC code designated for the contract. The
majority of the venture's earnings must accrue directly to the
socially and economically disadvantaged individuals in the SDB
concern(s) in the joint venture. The percentage of the ownership
involvement in a joint venture by disadvantaged individuals must be
at least 51 percent.
* * * * *
(End of provision)
52.219-11 [Amended]
12. Section 52.219-11 is amended by removing Alternate I.
52.219-12 [Amended]
13. Section 52.219-12 is amended by removing Alternate I.
14. Section 52.219-17 is amended by revising the clause date and by
adding paragraphs (a)(5) and (c) to read as follows:
52.219-17 Section 8(a) Award.
* * * * *
SECTION 8(a) AWARD (DEC 1996)
(a) * * *
(5) That the subcontractor awarded a subcontract hereunder shall
have the right of appeal from decisions of the cognizant Contracting
Officer under the ``Disputes'' clause of the subcontract.
* * * * *
(c) The offeror/subcontractor agrees that it will not
subcontract the performance of any of the requirements of this
subcontract to any lower tier subcontractor without the prior
written approval of the SBA and the cognizant Contracting Officer of
the __________ [insert name of contracting agency].
(End of clause)
52.219-18 [Amended]
15. Section 52.219-18 is amended by removing Alternate II and by
redesignating Alternate III as Alternate II.
[FR Doc. 96-32007 Filed 12-19-96; 8:45 am]
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