[Federal Register Volume 63, Number 249 (Tuesday, December 29, 1998)]
[Rules and Regulations]
[Pages 71722-71723]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-34365]
[[Page 71721]]
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Part VII
Department of Defense
General Services Administration
National Aeronautics and Space Administration
Office of Management and Budget
_______________________________________________________________________
48 CFR Parts 19 and 52
Reform of Affirmative Action in Federal Procurement; Interim Final Rule
and Notice
Federal Register / Vol. 63, No. 249 / Tuesday, December 29, 1998 /
Rules and Regulations
[[Page 71722]]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 19 and 52
[FAC 97-07 Addendum; FAR Case 97-004B Correction]
RIN 9000-AH59
Federal Acquisition Regulation; Reform of Affirmative Action in
Federal Procurement; Corrections
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Interim rule; Correcting amendments.
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SUMMARY: The Department of Defense, the General Services
Administration, and the National Aeronautics and Space Administration
have agreed to issue an addendum to correct Federal Acquisition
Circular (FAC) 97-07 to make amendments to the Federal Acquisition
Regulation (FAR) concerning programs for small disadvantaged business
(SDB) concerns. These changes are needed to provide additional time for
subcontractors to become certified under rules issued by the Small
Business Administration. These amendments allow contractors acting in
good faith to accept the self-representation of subcontractors as to
their status as small disadvantaged business concerns. It is
anticipated that by July 1, 1999, a sufficient number of firms will
have been certified and the changes made by this rule rescinded. After
that date, solicitations will require contractors to use certified SDBs
as subcontractors to take advantage of the SDB Participation Program.
No other aspects of FAC 97-07 are being modified.
DATES: Effective Date: January 1, 1999.
Applicability Date: The policies, provisions, and clauses of this
Addendum apply for all solicitations issued on or after January 1,
1999.
Comment Date: Comments should be submitted to the FAR Secretariat
at the address shown below on or before March 1, 1999 to be considered
in the formulation of a final rule.
ADDRESSES: Interested parties should submit written comments to:
General Services Administration, FAR Secretariat (MVR), 1800 F Street,
NW, Room 4035, Attn: Ms. Laurie Duarte, Washington, DC 20405.
E-Mail comments submitted over the Internet should be addressed to:
[email protected]
Please cite FAC 97-07 Addendum, FAR case 97-004B, in all
correspondence related to this case.
FOR FURTHER INFORMATION CONTACT:
Ms. Victoria Moss, Procurement Analyst Federal Acquisition Policy
Division, General Services Administration, 1800 F Street, NW,
Washington, DC 20405, Telephone: (202) 501-4764
or
Mr. Mike Sipple, Procurement Analyst, Contract Policy and
Administration, Director, Defense Procurement, Department of Defense
3060 Defense Pentagon, Washington, DC 20301-3060, Telephone: (703) 695-
8567.
For general information, call the FAR Secretariat at (202) 501-
4755.
SUPPLEMENTARY INFORMATION:
A. Background
On July 1, 1998, DoD, GSA, and NASA issued FAC 97-07 to make
amendments to the FAR concerning programs for small disadvantaged
business concerns. This document revises the rule published at 63 FR
36120, July 1, 1998, to allow contractors acting in good faith to rely
upon the self-representations of their subcontractors as to their
status as a small disadvantaged business concern.
Urgent and compelling reasons exist to promulgate this rule without
prior opportunity for public comment. This action is necessary to amend
regulations that will become effective on January 1, 1999, to reflect
the current scarcity of certified small disadvantaged business
subcontractors.
This regulatory action was not subject to Office of Management and
Budget review under Executive Order 12866, dated September 30, 1993.
This is not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
These changes modify the manner in which a firm, acting as a
subcontractor, may indicate that it is a small disadvantaged business
concern (SDB). On June 30, 1998, the Small Business Administration
(SBA) issued rules concerning the certification and eligibility of
SDBs. SBA prepared and issued an analysis of that rule's impact on
small entities at that time. The acquisition programs designed to
assist SDB subcontractors were issued in Federal Acquisition Circular
97-07 at 63 FR 36120, July 1, 1998. At that time, an Initial Regulatory
Flexibility Analysis was prepared discussing the impact of the
programs. The changes in this Addendum do not affect the impact of the
acquisition programs on small entities; they merely revise the manner
in which a firm is considered eligible under the programs. Therefore,
the Initial Regulatory Flexibility Analysis published with FAC 97-07 is
unaffected by these changes and remains valid.
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 collection of information from offerors, contractors,
or members of the public which require the approval of OMB under 44
U.S.C. 3501, et seq.
List of Subjects in 48 CFR Parts 19 and 52
Government procurement.
Dated: December 22, 1998.
Victoria Moss,
Acting Director, Federal Acquisition Policy Division.
FEDERAL ACQUISITION CIRCULAR
FAC 97-07 Addendum
Federal Acquisition Circular (FAC) 97-07 Addendum is issued under
the authority of the Secretary of Defense, the Administrator of General
Services, and the Administrator for the National Aeronautics and Space
Administration.
The policies, provisions, and clauses of this Addendum are
effective for all solicitations issued on or after January 1, 1999.
Dated: December 21, 1998.
Carol F. Covey,
Acting Director, Defense Procurement.
Ida M. Ustad,
Deputy Associate Administrator, Office of Acquisition Policy, General
Services Administration.
Dated: December 22, 1998.
James A. Balinskas,
Acting Associate Administrator for Procurement, National Aeronautics
and Space Administration.
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: 41 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 19--SMALL BUSINESS PROGRAMS
2. Section 19.001 is amended by revising the definition of ``Small
disadvantaged business concern'' to read as follows:
[[Page 71723]]
19.001 Definitions.
* * * * *
Small disadvantaged business concern, as used in this part, means--
(1) For prime contractors (except for 52.212-3(c)(2) and 52.219-
1(b)(2) for general statistical purposes and 52.212-3(c)(7)(ii),
52.219-22(b)(2), and 52.219-23(a) for joint ventures under the price
evaluation adjustment for small disadvantaged business concerns), an
offeror that represents, as part of its offer, that it is a small
business under the size standard applicable to the acquisition; and
either--
(i) It has received certification as a small disadvantaged business
concern consistent with 13 CFR part 124, subpart B; and
(A) No material change in disadvantaged ownership and control has
occurred since its certification;
(B) Where the concern is owned by one or more disadvantaged
individuals, the net worth of each individual upon whom the
certification is based does not exceed $750,000 after taking into
account the applicable exclusions set forth at 13 CFR 124.104(c)(2);
and
(C) It is listed, on the date of its representation, on the
register of small disadvantaged business concerns maintained by the
Small Business Administration; or
(ii) It has submitted a completed application to the Small Business
Administration or a private certifier to be certified as a small
disadvantaged business concern in accordance with 13 CFR part 124,
subpart B, and a decision on that application is pending, and that no
material change in disadvantaged ownership and control has occurred
since its application was submitted. In this case, a contractor must
receive certification as an SDB by the SBA prior to contract award.
(2) For subcontractors, an offeror that represents, as part of its
offer, that it is a small business under the size standard applicable
to the acquisition and that it meets the definition of a small
disadvantaged business in 13 CFR 124.1002.
* * * * *
3. Section 19.703 is amended by revising paragraph (b) to read as
follows:
19.703 Eligibility requirements for participating in the program.
* * * * *
(b) A contractor acting in good faith may rely on the written
representation of its subcontractor regarding the subcontractor's
status as a small, small disadvantaged, or a woman-owned small business
concern. The contractor, the contracting officer, or any other
interested party can challenge a subcontractor's size status
representation by filing a protest, in accordance with 13 CFR 121.1601
through 121.1608. Protests challenging a subcontractor's small
disadvantaged business representation shall be filed in accordance with
13 CFR 124.1015 through 124.1022.
4. Section 19.1202-4 is amended by adding paragraph (c) to read as
follows:
19.1202-4 Procedures.
* * * * *
(c) A contractor acting in good faith may rely on the written
representation of its subcontractor regarding the subcontractor's
status as a small disadvantaged business concern.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
5. Section 52.219-8 is amended by revising paragraph (c) of the
clause to read as follows:
52.219-8 Utilization of Small, Small Disadvantaged, and Women-Owned
Small Business Concerns.
* * * * *
Utilization of Small, Small Disadvantaged, and Women-Owned Small
Business Concerns (Jan 1999)
* * * * *
(c) As used in this clause, the term ``small business concern''
shall mean a small business as defined pursuant to section 3 of the
Small Business Act and relevant regulations promulgated pursuant
thereto. The term ``small business concern owned and controlled by
socially and economically disadvantaged individuals'' shall mean a
small business concern that represents, as part of its offer, that
it meets the definition of a small disadvantaged business concern in
13 CFR 124.1002.
* * * * *
6. Section 52.219-25 is amended by revising paragraph (a) of the
clause to read as follows:
52.219-25 Small Disadvantaged Business Participation Program--
Disadvantaged Status and Reporting.
* * * * *
Small Disadvantaged Business Participation Program--Disadvantaged
Status and Reporting (Jan 1999)
(a) Disadvantaged status for joint venture partners, team
members, and subcontractors. This clause addresses disadvantaged
status for joint venture partners, teaming arrangement members, and
subcontractors and is applicable if this contract contains small
disadvantaged business (SDB) participation targets. The Contractor
shall obtain representations of small disadvantaged status from
joint venture partners and teaming arrangement members through use
of a provision substantially the same as paragraph (b)(1)(i) of the
provision at FAR 52.219-22, Small Disadvantaged Business Status. The
Contractor shall confirm that a joint venture partner or team
member, representing itself as a small disadvantaged business
concern, is included in the SBA's on-line list of SDBs at http://
www.sba.gov or by contacting the SBA's Office of Small Disadvantaged
Business Certification and Eligibility. The Contractor acting in
good faith may rely on a written representation of its subcontractor
regarding the subcontractor's status as a small disadvantaged
business concern as defined in 13 CFR 124.1002.
* * * * *
[FR Doc. 98-34365 Filed 12-28-98; 8:45 am]
BILLING CODE 6820-EP-P
