01-13819. Procurement List; Additions

AGENCY:

Committee for Purchase From People Who Are Blind or Severely Disabled.

ACTION:

Additions to the Procurement List.

SUMMARY:

This action adds to the Procurement List commodities and services to be furnished by nonprofit agencies employing persons who are blind or have other severe disabilities.

EFFECTIVE DATE:

July 2, 2001.

ADDRESSES:

Committee for Purchase From People Who Are Blind or Severely Disabled, Jefferson Plaza 2, Suite 10800, 1421 Jefferson Davis Highway, Arlington, Virginia 22202-3259.

FOR FURTHER INFORMATION CONTACT:

Patrick T. Mooney [phone].

SUPPLEMENTARY INFORMATION:

On October 13, 2000, April 13 and 20, 2001, the Committee for Purchase From People Who Are Blind or Severely Disabled published notices (65 FR 60903, 66 FR 19136, 19137 and 20234) of proposed additions to the Procurement List.

The following comments pertain to Vegetable Oil, 8945-00-NSH-0001, additional 5% of the Governments requirement.

Comments were received from a current contractor for the vegetable oil. The commenter raised several points in opposing the Committee's proposal. First, the commenter questioned the scope of the proposed addition to the Procurement List. Second, the commenter claimed that the proposed addition would have a severe impact on that company. Third, the commenter claimed that the amount of vegetable oil being added to the Procurement List exceeded the share being provided by small businesses. Fourth, the commenter questioned the Committee's oversight of the fair market price determinations being made for vegetable oil. Fifth, the commenter claimed that the price determinations must be based on statutory and regulatory principles contained in the law governing overseas food assistance programs.

In 1999, the Committee added 15 percent of the total Government requirement for this vegetable oil purchased for overseas food assistance to the Procurement List. By notice published in the August 25, 2000 Federal Register (65 FR 51794), the Committee proposed the addition to the Procurement List of an additional 5 percent of the Government requirement, or a monthly amount not to exceed 3,500 metric tons. Because of confusion over the scope of this proposed addition, the Committee on October 13, 2000 republished the proposal in the Federal Register (65 FR 60903), stating that its scope was only an additional 5 percent of the Government requirement. The Committee further clarified this correction in a Federal Register notice of October 27, 2000 (65 FR 64420).

The Committee has traditionally considered its Procurement List additions to apply to annual Government requirements for commodities. Accordingly, this addition will raise from 15 percent to 20 percent the portion of the total annual Government requirement for this commodity which must be purchased from the designated nonprofit agency. However, this commodity has traditionally been purchased on a monthly basis, and the procuring Government agency, the U.S. Department of Agriculture (USDA) has informed the Committee that it will apply the percentage reservation for the nonprofit agency to its monthly purchases.

USDA purchases vegetable oil in three sizes of containers: 6/4 liter, 20 liter, and 50 gallon. The nonprofit agency designated by the Committee produces the oil in only the first two of these three containers. The commenter has therefore argued that the scope of the Procurement List additions should be limited to a percentage of the vegetable oil purchases which are in those two container sizes. However, the intent of the Committee and USDA is that the Procurement List addition applies to the designated percentage of the total Government requirement, regardless of the size of containers involved.

The commenter claimed in opposing the 1999 addition of 15 percent of the vegetable oil requirement to the Procurement List that it would be severely impacted by the addition. At that time, it was one of two suppliers of the oil to USDA. Since then, the commenter has purchased the oil facilities of the other supplier. While two other small businesses now also supply the oil to USDA, the commenter retains the great majority of the sales to USDA. Consequently, the Committee does not believe that the current addition of an additional 5 percent of the supply requirement to the Procurement List will have a severe adverse impact on the commenter, even when the 1999 addition is taken into account.

Except as provided by the Regulatory Flexibility Act, 5 U.S.C. Chap. 6, the Committee is not required to assess the impact of its Procurement List additions on small businesses. Consequently, the commenter's claims in this area are not relevant to a Procurement List addition decision.

Committee fair market price determinations on USDA bulk food item procurements subject to the Procurement List are governed by a 1993 pricing procedure that establishes an annual fair market price under standard Committee procedures and permits monthly changes to that price based on negotiations between USDA and the nonprofit agency which take into account changing market conditions. Since 1993, the Committee has changed its general commodities pricing procedures to reflect a preference for negotiations generally as a means of assuring that its fair market prices reflect market conditions. Consequently, the pricing procedure used for vegetable oil is consistent with the Committee's general fair market pricing procedures for commodities and do not indicate a lack of Committee oversight as the commenter claimed. USDA's purchases of commodities such as vegetable oil are governed by a law commonly known as Public Law 480 and its implementing regulations. One of the principles of the regulations is that commodities purchased under the Public Law 480 program must be at the “lowest landed cost,” which, the commenter claimed, is not consistent with the Committee's pricing procedures. The commenter further claimed that the Committee's prices, which allegedly do not reflect the lowest landed cost, result in USDA having less money to achieve its objectives under Public Law 480.

USDA has informed the Committee that Public Law 480 is not inconsistent with the Committee's program. Furthermore, USDA is authorized to take into account factors other than lowest landed cost when buying such commodities as vegetable oil, particularly in connection with socioeconomic programs such as the Committee's program. USDA also indicated that its costs to buy vegetable oil through the Committee's program are not significantly increased over purchases from commercial suppliers, as any additional cost of dealing with the nonprofit agency is offset by not having to pay for replacement quantities, storage and transportation due to leakage and damaged containers, as USDA has done when dealing with commercial suppliers of vegetable oil.

The following material pertains to all of the items being added to the Procurement List. After consideration of the material presented to it concerning capability of qualified nonprofit agencies to provide the commodities and services and impact of the additions on the current or most recent contractors, the Committee has determined that the services listed below are suitable for procurement by the Federal Government under 41 U.S.C. 46-48c and 41 CFR 51-2.4. I certify that the following action will not have a significant impact on a substantial number of small entities. The major factors considered for this certification were:

1. The action will not result in any additional reporting, recordkeeping or other compliance requirements for small entities other than the small organizations that will furnish the commodities and services to the Government.

2. The action will not have a severe economic impact on current contractors for the commodities and services.

3. The action will result in authorizing small entities to furnish the commodities and services to the Government.

4. There are no known regulatory alternatives which would accomplish the objectives of the Javits-Wagner-O'Day Act (41 U.S.C. 46-48c) in connection with the commodities and services proposed for addition to the Procurement List.

Accordingly, the following commodities and services are hereby added to the Procurement List:

Commodities

Hose, Fire, 4210-00-542-3480, Vegetable Oil, 8945-00-NSH-0001.

Services

Administrative Services, Building 8-1078, 1-3571, C-7417, 8-6643, Fort Bragg, North Carolina.

Call Center Services, Department of State, Bureau of Consular Affairs (Various location throughout USA), Washington, DC.

Food Service Attendant, Main Dining Facility—Building 3650, Expanded Flight Kitchen—Building 4507, Seymour Johnson AFB, North Carolina.

Janitorial/Custodial, U.S. Air Force Recruiting Station, Wasilla, Alaska.

Janitorial/Custodial, Veterans Affairs, Greater Los Angeles Healthcare System, East Los Angeles Out Patient Clinic, East Los Angeles, California.

Janitorial/Custodial, Social Security Administration, Western Program Center, 1221 Nevin Avenue, Richmond, California.

Janitorial/Custodial, Chateaugay Border Station, Chateaugay, New York.

Janitorial/Custodial, Defense Enterprise Computing Center (DECC), Buildings 308 and 309, Naval Supply Activity (NSA), Mechanicsburg, Pennsylvania.

Janitorial/Custodial, Veteran Affairs Building, 5000 Wissahickon Avenue, Philadelphia, Pennsylvania.

Janitorial/Custodial, Veterans Affairs Medical Center, Huntington, West Virginia.

Janitorial/Custodial, ATF Building, Martinsburg, West Virginia.

Ophthalmic Support Services, Yorktown Naval Weapons Station, Yorktown, Virginia.

This action does not affect current contracts awarded prior to the effective date of this addition or options that may be exercised under those contracts.

Louis R. Bartalot,

Director, Program Analysis and Evaluation.