00-7311. Federal Acquisition Regulation; Small Entity Compliance Guide

AGENCIES:

Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).

ACTION:

Small Entity Compliance Guide.

SUMMARY:

This document is issued under the joint authority of the Secretary of Defense, the Administrator of General Services and the Administrator for the National Aeronautics and Space Administration. This Small Entity Compliance Guide has been prepared in accordance with Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121). It consists of a summary of rules appearing in Federal Acquisition Circular (FAC) 97-16 which amend the FAR. The rule marked with an asterisk (*) indicates that a regulatory flexibility analysis has been prepared in accordance with 5 U.S.C. 604. Interested parties may obtain further information regarding these rules by referring to FAC 97-16 which precedes this document. These documents are also available via the Internet at http://www.arnet.gov/​far.

FOR FURTHER INFORMATION CONTACT:

Laurie Duarte, FAR Secretariat, [phone]. For clarification of content, contact the analyst whose name appears in the table below.

List of Rules in FAC 97-16

Item	Subject	FAR case	Analyst
I	Small Business Competitiveness Demonstration Program (Interim)	1999-012	Moss.
II	Progress Payments and Related Financing Policies *	1998-400 (98-400)	Olson.

Item I—Small Business Competitiveness Demonstration Program (FAR Case 1999-012)

This interim rule amends FAR Subpart 19.10 to clarify language pertaining to the Small Business Competitiveness Demonstration (Comp. Demo.) Program, consistent with revisions to the Program that were contained in an OFPP and SBA joint final policy directive dated May 25, 1999.

The interim rule—

• Advises the contracting officer to consider the 8(a)

Program and HUBZone Program, in addition to small business set-asides, for acquisitions of $25,000 or less in one of the four designated industry groups that will not be set aside for emerging small business concerns.

• Adds FAR 19.1006, Exclusions, to specify acquisitions to which Subpart 19.10 does not apply. None of the Small Business Comp. Demo. policies and procedures apply to orders under the Federal Supply Schedule Program or to contracts awarded to educational and nonprofit institutions or governmental entities.

This interim rule only will affect contracting officers at participating agencies when acquiring supplies or services subject to the procedures of the Small Business Comp. Demo. Program. The participating agencies are: Department of Agriculture; Department of Defense, except the National Imagery and Mapping Agency; Department of Energy; Department of Health and Human Services; Department of the Interior; Department of Transportation; Department of Veterans Affairs; Environmental Protection Agency; General Services Administration; and National Aeronautics and Space Administration.

Item II—Progress Payments and Related Financing Policies (FAR Case 1998-400) (98-400)

This final rule revises certain financing policies at FAR Part 32, Contract Financing, and related contract provisions at FAR Part 52. The rule—

• Emphasizes that performance-based payments are the preferred method of contract financing. Performance-based payments are contract financing payments made after achievement of predetermined goals, such as performance objectives or defined events. Contracting officers should consider performance-based payments and deem their use impracticable before deciding to provide customary progress payments;
• Permits contracting officers to provide contract financing on contracts awarded to large businesses if the individual contract is $2 million or more. Previously, the threshold in the FAR for financing a contract with a large business was $1 million;
• Permits a large business to bill the Government for subcontract costs that the large business has incurred but not actually paid, if certain conditions are met. Previously, the FAR permitted only small business concerns to bill for subcontract costs that have been incurred but not paid;
• Permits the contracting officer to use performance-based payments in contracts for research and development, and in contracts awarded through competitive negotiation procedures; and
• Is effective on March 27, 2000. However, it is mandatory only for solicitations issued on or after May 26, 2000. Contracting officers may, at their discretion, include the clauses and provisions in this rule in solicitations issued before that date.

Dated: March 20, 2000.

Edward C. Loeb,

Director, Federal Acquisition Policy Division.