2011-14650. Federal Acquisition Regulation; Prioritizing Sources of Supplies and Services for Use by the Government

AGENCIES:

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

ACTION:

Proposed rule.

SUMMARY:

DoD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (FAR) to limit the section of the FAR addressing the priorities for use of Government supply sources to a discussion of the mandatory Government sources of supplies and services. Also, a new section is added to encourage agencies to give priority consideration to using certain sources, despite the fact that the use of the listed sources is not mandatory.

DATES:

Interested parties should submit written comments to the Regulatory Secretariat at one of the addressees shown below on or before August 15, 2011 to be considered in the formation of the final rule.

ADDRESSES:

Submit comments in response to FAR Case 2009-024 by any of the following methods:

• Regulations.gov: http://www.regulations.gov. Submit comments via the Federal eRulemaking portal by inputting “FAR Case 2009-024” under the heading “Enter Keyword or ID” and selecting “Search.” Select the link “Submit a Comment” that corresponds with “FAR Case 2009-024.” Follow the instructions provided at the “Submit a Comment” screen. Please include your name, company name (if any), and “FAR Case 2009-024” on your attached document.
• Fax: [phone].
• Mail: General Services Administration, Regulatory Secretariat (MVCB), Attn: Hada Flowers, 1275 First Street, NE., 7th Floor, Washington, DC 20417.

Instructions: Please submit comments only and cite FAR Case 2009-024, in all correspondence related to this case. All comments received will be posted without change to http://www.regulations.gov,, including any personal and/or business confidential information provided.

FOR FURTHER INFORMATION CONTACT:

Mr. William Clark, Procurement Analyst, at [phone] for clarification of content. For information pertaining to status or publication schedules, contact the Regulatory Secretariat at [phone]. Please cite FAR Case 2009-024.

SUPPLEMENTARY INFORMATION:

I. Background

DoD, GSA, and NASA are proposing to amend the FAR part 8. FAR part 8 requires Federal agencies to satisfy their requirements for supplies and services from or through a list of sources in order of priority. This proposed rule would amend FAR part 8 by revising FAR 8.000, 8.002, 8.003, and 8.004, eliminating outdated categories, and distinguishing between Government sources (e.g., Federal Supply Schedules (FSS)) and private-sector sources.

The impetus for this proposed rule is the Government Accountability Office (GAO) decision in the protest of Murray-Benjamin Electric Company, B-298481, 2006 CPD 129, September 7, 2006 at (http://www.gao.gov/​decisions/​bidpro/​298481.pdf). As a result of this GAO decision, clarification was needed, in FAR part 8, on the use and consideration of FSS contracts before commercial sources in the open market.

The proposed rule amends FAR 8.002 as follows: The title is revised, as appropriate, to indicate the section establishes the priorities for mandatory Government sources. The term “Mandatory Federal Supply Schedules” is removed. “Optional Use Federal Supply Schedules” is re-named “Federal Supply Schedules” and is proposed to be moved to a new section (FAR 8.004) as a non-mandatory source. Commercial sources, currently listed under FAR 8.002(a), and Federal Prison Industries, Inc., listed as a source for services at FAR 8.002(a)(2), would also be moved to the new section as non-mandatory sources because neither one is a “mandatory Government source.”

Additionally, the title at FAR 8.003 is amended to indicate that the list is of mandatory sources, but recognize that they are not all Government sources. Also, the word “supplies” would be deleted from the title because these sources also provide services.

A new section, FAR 8.004, Use of other sources, is proposed to be added to list non-mandatory sources that agencies are encouraged to consider after first considering the mandatory sources listed at FAR 8.002 and 8.003. This section highlights existing contracts intended for use by multiple agencies (e.g., Federal Supply Schedules, Governmentwide acquisition contracts (GWACs), and multi-agency contracts (MACs)) and ordering instruments intended for use by multiple agencies, such as blanket purchase agreements (BPAs) under Federal Supply Schedule contracts (e.g., Federal Strategic Sourcing Initiative (FSSI) agreements). The existing contracts and instruments are not listed in any order of priority, and separate paragraphs distinguish supplies from services. When obtaining services, agencies are encouraged to consider the same sources listed for supplies under FAR 8.004, with the addition of Federal Prison Industries, Inc. as another non-mandatory source for services pursuant to FAR subpart 8.6. Agencies would be encouraged to consider these sources before satisfying requirements for supplies and services from commercial sources in the open market. The proposed FAR 8.004 would also provide a cross-reference to FAR 5.601, where the Web site for the Governmentwide database of contracts and other procurement instruments intended for use by multiple agencies via the Internet at http://www.contractdirectory.gov is provided.

Conforming changes are proposed at FAR 9.405-1 to delete the words “optional use”; and at FAR 52.208-9 to correct the cross-reference to the clause prescription.

II. Executive Orders 12866 and 13563

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is a significant regulatory action and, therefore, was subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

III. Regulatory Flexibility Act

DoD, GSA, and NASA do not expect this rule 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., because the rule does not impose any additional requirements on small businesses, but clarifies existing regulations, in FAR part 8, on the use of existing mandatory and non-mandatory sources.

Therefore, an Initial Regulatory Flexibility Analysis has not been performed. DoD, GSA, and NASA invite comments from small business concerns and other interested parties on the expected impact of this rule on small entities.

DoD, GSA, and NASA will also consider comments from small entities concerning the existing regulations in subparts affected by the rule in accordance with 5 U.S.C. 610. Interested parties must submit such comments separately and should cite 5 U.S.C. 610 (FAR Case 2009-024), in correspondence.

IV. Paperwork Reduction Act

The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subjects in 48 CFR Parts 8, 9, and 52

• Government procurement

Dated: June 8, 2011.

Millisa Gary,

Acting Director, Federal Acquisition Policy Division.

Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 8, 9, and 52 as set forth below:

1. The authority citation for 48 CFR parts 8, 9, and 52 continues to read as follows:

Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42 U.S.C. 2473(c).

2. Revise section 8.000 to read as follows:

PART 8—REQUIRED SOURCES OF SUPPLIES AND SERVICES

8.000

Scope of part.

This part deals with prioritizing sources acquisition of supplies and services for use by the Government.

3. Amend section 8.002 by—

a. Revising the section heading;

b. Removing from the introductory text of paragraph (a) “sources” and adding “mandatory Government sources” in its place;

c. Removing paragraphs (a)(1)(vi), (a)(1)(vii), and (a)(1)(viii); and

d. Revising paragraph (a)(2).

The revised text reads as follows:

8.002

Priorities for use of mandatory Government sources.

(a) * * *

(2) Services. Services which are on the Procurement List maintained by the Committee for Purchase From People Who Are Blind or Severely Disabled (see subpart 8.7).

* * * * *

8.003

Use of other mandatory sources.

4. Amend section 8.003 by revising the section heading as set forth above.

5. Redesignate section 8.004 as section 8.005 and add a new section 8.004 to read as follows:

8.004

Use of other sources.

Where an agency is unable to satisfy requirements for supplies and services from the mandatory sources listed in 8.002 and 8.003, agencies are encouraged to consider satisfying requirements from or through the non-mandatory sources listed in paragraph (a) of this section before considering the non-mandatory sources listed in paragraph (b) of this section.

(a)(1) Supplies. Federal Supply Schedules, Governmentwide acquisition contracts, multi-agency contracts, and any other procurement instruments intended for use by multiple agencies, including blanket purchase agreements (BPAs) under Federal Supply Schedule contracts (e.g., Federal Strategic Sourcing Initiative (FSSI) agreements accessible at http://www.gsa.gov/​fssi (see also 5.601)).

(2) Services. In addition to the sources listed in paragraph (a)(1) of this section, agencies are encouraged to consider Federal Prison Industries, Inc. (see subpart 8.6).

(b) Commercial sources (including educational and non-profit institutions) in the open market.

8.402

[Amended]

6. Amend section 8.402 by removing from paragraph (a) “(see 8.002)” and adding “(see 8.004)” in its place.

PART 9—CONTRACTOR QUALIFICATIONS

9.405-1

[Amended]

7. Amend section 9.405-1 by removing from paragraph (b)(2) “optional use”.

PART 52—SOLICITATION PROVISIONS AND CONTRACT CLAUSES

52.208-9

[Amended]

8. Amend section 52.208-9 by removing from the introductory paragraph “8.004” and adding “8.005” in its place.