99-15217. Procedures for Protests and Contract Disputes; Amendment of Equal Access to Justice Act Regulations  

  • [Federal Register Volume 64, Number 117 (Friday, June 18, 1999)]
    [Rules and Regulations]
    [Pages 32926-32945]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 99-15217]
    
    
    
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    Part II
    
    
    
    
    
    Department of Transportation
    
    
    
    
    
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    Federal Aviation Administration
    
    
    
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    14 CFR Parts 14 and 17
    
    
    
    Procedures for Protests and Contract Disputes; Amendment of Equal 
    Access to Justice Act Regulations; Final Rule
    
    Federal Register / Vol. 64, No. 117 / Friday, June 18, 1999 / Rules 
    and Regulations
    
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    DEPARTMENT OF TRANSPORTATION
    
    Federal Aviation Administration
    
    14 CFR Parts 14 and 17
    
    [Docket No. FAA-1998-4379; Amendment No. 14-0317-01]
    RIN 2120-AG19
    
    
    Procedures for Protests and Contract Disputes; Amendment of Equal 
    Access to Justice Act Regulations
    
    ACTION: Final rule.
    
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    SUMMARY: This document provides regulations for the conduct of protests 
    and contract disputes under the Federal Aviation Administration 
    Acquisition Management System (AMS). Also, the Federal Aviation 
    Administration (FAA) regulations governing the application for, and 
    award of, Equal Access to Justice Act (EAJA) fees are amended to 
    include procedures applicable to the resolution of protests and 
    contract disputes under the AMS, and to conform to the current EAJA 
    statute.
    
    EFFECTIVE DATE: June 28, 1999.
    
    FOR FURTHER INFORMATION CONTACT: Marie A. Collins, Staff Attorney, and 
    Dispute Resolution Officer, FAA Office of Dispute Resolution for 
    Acquisition, AGC-70, Room 8332, Federal Aviation Administration, 400 
    7th Street, SW., Washington, DC 20590, telephone (202) 366-6400.
    
    SUPPLEMENTARY INFORMATION:
    
    Availability of Final Rules
    
        An electronic copy of this document may be downloaded, using a 
    modem and suitable communications software, from the FAA regulations 
    section of the Fedworld electronic bulletin board service (telephone: 
    703-321-3339), the Government Printing Office's electronic bulletin 
    board service (telephone: 703-321-1661), or the FAA's Aviation 
    Rulemaking Advisory Committee Bulletin Board service (telephone: 800-
    322-2722 or 202-267-5948).
        Internet users may reach the FAA's web page at http://www.faa.gov/
    avr/arm/nprm.htm or the Government Printing Office's webpage at http://
    www.access.gpo.gov/nara for access to recently published rulemaking 
    documents.
        Any person may obtain a copy of this final rule by submitting a 
    request to the Federal Aviation Administration, Office of Rulemaking, 
    ARM-1, 800 Independence Avenue, SW., Washington, DC 20591, or by 
    calling (202) 267-9680. Communications must identify the amendment 
    number or docket number of this final rule.
        Persons interested in being placed on the mailing list for future 
    Notices of Proposed Rulemaking and Final Rules should request from the 
    above office a copy of Advisory Circular No. 11-2A, Notice of Proposed 
    Rulemaking Distribution System, that describes the application 
    procedure.
    
    Small Entity Inquiries
    
        The Small Business Regulatory Enforcement Fairness Act of 1996 
    (SBREFA) requires the FAA to report inquiries from small entities 
    concerning information on and advice about compliance with statutes and 
    regulations within the FAA's jurisdiction, including interpretation and 
    application of the law to specific sets of facts supplied by a small 
    entity.
        If your organization is a small entity and you have a question, 
    contact your local FAA official. If you do not know how to contact your 
    local FAA official, you may contact Charlene Brown, Program Analyst 
    Staff, Office of Rulemaking ARM-27, Federal Aviation Administration, 
    800 Independence Avenue SW., Washington, DC 20591, (888) 551-1594. 
    Internet users can find additional information on SBREFA in the ``Quick 
    Jump'' section of the FAA's web page at http://www.faa.gov and may send 
    electronic inquiries to the following internet address: 9-AWA-
    [email protected]
    
    Background
    
    Statement of the Problem
    
        In accordance with Congressional mandate, the FAA procures, 
    acquires, and develops services as well as material in support of its 
    mission of safety in civil aviation. Prior to April 1, 1996, several 
    major FAA acquisitions under the Government-wide acquisition system 
    were substantially behind schedule and experienced large cost over 
    runs. Both the Administration and the Congress became concerned that 
    the safety mission of the FAA might suffer from the inefficiency of the 
    then existing acquisition system, including its dispute resolution 
    system.
        In the Fiscal Year 1996 Department of Transportation Appropriations 
    Act, Public Law 104-50, 109 Stat. 436 (November 15, 1995), the Congress 
    directed the FAA ``to develop and implement, not late than April 1, 
    1996, an acquisition management system that addressed the unique needs 
    of the agency and, at a minimum, provided for more timely and cost 
    effective acquisitions of equipment and materials.'' In that Act, the 
    Congress gave the FAA authority to create a new acquisition system, 
    ``notwithstanding provisions of Federal Acquisition law.'' In addition, 
    Congress specifically instructed the FAA not to use certain provisions 
    of federal acquisition law. In response, the FAA developed the AMS for 
    the management of FAA procurement. The AMS is a system of policy 
    guidance that maximizes the use of agency discretion in the interest of 
    best business practice.
        As part of the AMS, the FAA created the Office of Dispute 
    Resolution for Acquisition (ODRA) to facilitate the Administrator's 
    review of procurement protests and contract disputes. Notice of 
    establishment of the ODRA was published on May 14, 1996, in the Federal 
    Register (61 FR 24348). In that notice, the FAA stated it would 
    promulgate rules of procedure governing the dispute resolution process. 
    Currently, procedures and other provisions related to dispute 
    resolution are negotiated and included or referenced in all FAA 
    Screening Information Requests (SIRs) and contracts. The FAA has 
    determined that it will be more effective and efficient to establish by 
    rulemaking the dispute resolution procedures that apply to protests 
    concerning SIRs and contract awards, and to disputes arising from 
    established contracts. The rule is designed to contain the minimum 
    procedures necessary for efficient and orderly resolution of protests 
    and contract disputes arising under the AMS.
        The FAA Dispute Resolution Process, and the procedures implementing 
    that process, are based upon the powers Congress delegated to the 
    Administrator of the FAA under Title 49, United States Code, Subtitle 
    VII (49 U.S.C. 40101, et seq.). These delegated powers include the 
    administrator's power to procure goods and services, and to investigate 
    and hold hearings regarding any matter placed under the Administrator's 
    authority. In the Federal Aviation Reauthorization Act of 1996, Pub. L. 
    104-264 (October 9, 1996), the Congress amended 49 U.S.C. 106(f) to 
    make the Administrator of the FAA the final authority over the FAA 
    acquisition process and FAA acquisitions.
        These FAA dispute resolution procedures encourage the parties to 
    protests and contract disputes to use Alternative Dispute Resolution 
    (ADR) as the primary means to resolve protests and contracts disputes, 
    in consonance with Department of Transportation and FAA policies to 
    utilize ADR to the maximum extent practicable. Under these procedures, 
    the ODRA actively encourages parties to consider ADR techniques such as 
    case evaluation,
    
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    mediation, arbitration, or other types of ADR.
        The procedures for protests and contract disputes anticipate that, 
    for a variety of reasons, certain disputes are not amenable to 
    resolution through ADR. In other cases, ADR may not result in full 
    resolution of a dispute. Thus, there is provision for a Default 
    Adjudicative Process. The EAJA, 5 U.S.C. 504, can apply in instances 
    where an eligible protester or contractor prevails over the FAA in the 
    Default Adjudicative Process. Title 14 of the Code of Federal 
    Regulations (CFR), Part 14 is amended to provide guidance for the 
    conduct of EAJA applications under the dispute resolution regulations 
    promulgated in 14 CFR part 17.
    
    Discussion of Comments
    
        Two comments were received on the proposed rule from the American 
    Bar Association Section of Public Contract Law (ABA) and the Associated 
    General Contractors of American (AGC). The ABA submitted both draft and 
    final comments.
        The comments of both the ABA and AGC generally supported the goals 
    of the proposed rule and endorsed its emphasis on ADR techniques. The 
    comments of the AGC raised only two points and, with respect to those 
    two points, indicated general agreement with the comments filed by the 
    ABA. The two points raised by the AGC pertain to sections of the 
    proposed rule that had dealt with matters of contract administration--
    the obligation to continue work pending resolution of a contract claim, 
    and the accrual of interest on a contract claim. The ABA, in addition 
    to addressing those points, sets forth a variety of comments outlining 
    concerns with the proposed rule. These pertain to, among other things: 
    (1) Whether the ODRA has exclusive jurisdiction over protests and 
    contract disputes under the AMS, and the continued applicability of 
    both the Tucker Act and the Contract Disputes Act (CDA); (2) 
    procurement suspensions in the context of a bid protest; (3) discovery; 
    (4) the opportunity for a hearing; (5) time limitations for the filing 
    of contract disputes; and (6) basic definitions. The ABA comments are 
    discussed in detail below. Some of the ABA comments seek within the 
    rule further elaboration and guidance regarding the ODRA's practices. 
    The FAA agrees that further guidance as to ODRA practices would foster 
    predictability in the FAA's protest and contract dispute procedures. 
    Additional guidance to the public on ODRA procedures will be published 
    on the Internet or otherwise, and may be revised by the ODRA as it 
    deems necessary, to conform to and more accurately describe current 
    dispute resolution practices employed by the ODRA. The ODRA publishes a 
    guide on its Website, which is accessible through the FAA Homepage 
    (http://www.faa.gov).
    
    Applicability of the Tucker Act and the Contract Disputes Act
    
        The ABA urges that the ODRA dispute resolution process is not 
    exempt from either the Tucker Act (28 U.S.C. 1491) or the Contract 
    Disputes Act (41 U.S.C. 601-613), and suggests that the rule limit its 
    applicability to protests and disputes brought before the ODRA, without 
    implying any jurisdictional exclusivity.
        FAA Response: The FAA disagrees. Section 348 of the FY 1996 
    Department of Transportation Appropriation Act, Public Law 104-50, 109 
    Stat. 436 (November 15, 1995) (the ``1996 Act'') did not merely list 
    specific statutes that were not to apply to the FAA AMS. Rather, in 
    calling for the establishment of the new AMS, Congress, in the 1996 
    Act, called more generally for the Administrator of the FAA to 
    ``develop and implement'' the new AMS ``notwithstanding provisions of 
    Federal acquisition law.'' Congress established the FAA Administrator 
    as the final authority for all acquisition activity necessary to carry 
    out the Agency's functions (49 U.S.C. 106(f)(2), 49 U.S.C. 46101, 
    et.seq., and Pub. L. 104-50). For dispute resolution purposes, the 
    Administrator's authority was expressly delegated to the ODRA on July 
    29, 1998, with the exception of final decision-making authority, other 
    than for dismissals arising from settlements or voluntary withdrawals; 
    or final authority to stay awards or contract performance (63 FR 
    49151).
        The FAA views the CDA as falling into the general category of 
    ``Federal acquisition law''. Indeed, like the Competition in 
    Contracting Act (CICA), the CDA is widely regarded as one of the basic 
    elements of the current system of ``Federal acquisition law.'' The 1996 
    Act specifically requires that the Federal Acquisition Streamlining Act 
    (FASA) not apply. Several sections of the CDA were amended under the 
    FASA in 1994. For example, Section 605 of the CDA was amended by the 
    FASA to include for the first time a six (6) year statute of limitation 
    on the submission of contract claims under the CDA. The FASA also 
    raised the CDA claim certification threshold from $50,000 to $100,000. 
    In addition, it added to Section 605 of the CDA a provision regarding 
    termination of ADR efforts to resolve CDA claims. Given the express 
    inapplicability of the FASA to FAA procurements, the ABA position would 
    require the FAA either to conform the AMS dispute resolution process 
    the pre-1994 (pre-FASA) version of the CDA or to disregard the express 
    direction of Congress regarding non-applicability of FASA.
        Furthermore, the Congress clearly intended the AMS to be free of 
    more than just those statutes enumerated in section 348. Section 
    348(a)(8) contains a ``catch all'' for any other unnamed acquisition 
    related statutes, exempting the AMS from ``(t)he Federal Acquisition 
    Regulation and any laws not listed (above in) this section providing 
    authority to promulgate regulations in the Federal Acquisition 
    Regulation.'' The CDA authorizes implementation through the 
    promulgation of regulations in the Federal Acquisition Regulation 
    (FAR), in that it authorizes guidelines to be promulgated by the Office 
    of Federal Procurement Policy (OFPP). The OFPP promulgates such 
    guidelines as part of the FAR under the authority of the OFPP Act. The 
    OFPP Act also was expressly made inapplicable to the AMS by the 1996 
    Act.
        As previously discussed, in 1996 Congress made the FAA 
    Administrator the final authority for all matters related to ``the 
    acquisition and maintenance of property and equipment of the 
    Administration.'' 49 U.S.C. 106. Further, under 49 U.S.C. 46110, any 
    person with a substantial interest in an order issued by the 
    Administrator may appeal exclusively to the United States Court of 
    Appeals for the District of Columbia Circuit or in the court of appeals 
    for the circuit in which the person resides or has its principal place 
    of business. The FAA believes, based on all of the above, that the only 
    reasonable reading of the 1996 Act is that it rendered the CDA 
    inapplicable to the FAA's new AMS.
        The same statutory provisions, 49 U.S.C. 106 and 46110, resolve the 
    question of Tucker Act jurisdiction. For purposes of judicial review of 
    final acquisition-related decisions of the FAA Administrator, the 
    specific, exclusive jurisdictional authority granted to the United 
    States Court of Appeal in 49 U.S.C. 46110 controls and takes precedence 
    over the non-exclusive, general authority over a variety of disputes 
    afforded the United States Court of Federal Claims and Federal District 
    Courts under the Tucker Act. See 28 U.S.C. 1491. In order to clarify 
    when judicial review may be had, Sec. 17.43 has been modified to 
    expressly recognize the availability of such review, only after 
    exhaustion of
    
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    administrative remedies through the FAA dispute resolution process.
    
    Definition of ``Compensated Neutral''
    
        The ABA recommends that Sec. 17.3(f), the definition of 
    ``Compensated Neutral,'' provide for the possibility of alternative 
    sharing formulas regarding the costs associated with engaging a 
    Compensated Neutral. The proposed rule had called for equal sharing of 
    such costs.
        FAA Response: The FAA agrees. Additional language has been 
    incorporated in Sec. 17.3(f) of the final rule, to allow for the 
    possibility that the costs associated with a Compensated Neutral be 
    shared between the parties.
    
    Definition of ``Discovery''
    
        The ABA recommends striking the definition or removing the 
    permissive language ``may, when allowed'' in Sec. 17.3(i). It notes 
    further that ``due process required sufficient discovery in each case 
    to permit a party to prove its case and challenge the other party's 
    evidence.''
        FAA Response: The FAA agrees in principle that discovery should be 
    allowed in order to provide an adequate record for the finder of fact. 
    However, in order to maintain the efficient resolution timeframes 
    established by the rules, the management of discovery must be left to 
    the discretion of the ODRA. To indicate that discovery is voluntary in 
    the first instance and to clarify that an appropriate level of 
    discovery is an integral component of the ODRA dispute resolution 
    process, Sec. 17.3(i) has been revised to read ``may, either 
    voluntarily or to the extent directed by the ODRA.''
    
    Definition of ``Office of Dispute Resolution for Acquisition''
    
        The ABA recommends that the definition in Sec. 17.3(n) either be 
    struck or, in the alternative, defined ``solely in terms of (the 
    ODRA's) authority with respect to bid protests or disputes filed with 
    it.'' The comment relates back to the ABA's stated position regarding 
    the continued applicability of both the Tucker Act and the CDA.
        FAA Response: The FAA disagrees. As indicated above, the FAA 
    believes that the ODRA has exclusive jurisdiction over all AMS protests 
    and contract disputes.
    
    Filing and Computation of Time
    
        The ABA notes that proposed Sec. 17.7(b) would be ``unworkable 
    given the short time frames for resolving protest,'' by reason of its 
    permitting submissions after initial filings to be made by regular 
    mail.
        FAA Response: The FAA agrees that the use of regular mail after 
    initial filings would not be consistent with a prompt, efficient bid 
    protest process. Therefore, the final rule provides for delivery of 
    such subsequent filings only by overnight delivery, hand delivery, or 
    by facsimile.
    
    Protective Orders
    
        The ABA suggests that the rule provide for the ODRA to develop and 
    publish a standard protective order along the lines of the model order 
    contained in the GAO Guide to GAO Protective Orders.
        FAA Response: The FAA disagrees that such a rule is necessary. The 
    ODRA has already developed and published such a standard order as part 
    of its Website. That order was based, in great measure, on the wording 
    of the GAO's model order.
    
    Simultaneous Pursuit of ADR
    
        The ABA observes that proposed Secs. 17.13, 17.27 and 17.31(c) 
    contemplate a sequential process, whereby adjudication is done only 
    after completion of ADR efforts. The ABA also notes that the current 
    practice of the ODRA frequently includes the use of ADR techniques 
    concurrently with an on-going adjudication, and that this practice has 
    produced favorable results in many instances. Accordingly, the ABA 
    suggests that the proposed rule be modified to conform to the current 
    practice.
        FAA Response: The FAA agrees. Section 17.31(c) has been modified to 
    add language which allows for informal ADR techniques (neutral 
    evaluation and mediation efforts) to be undertaken simultaneously with 
    adjudication under the Default Adjudicative Process. Section 17.13(d) 
    has been revised to conform to this change. Likewise, a new 
    Sec. 17.27(d) has been added to clarify that the submission of 
    statements indicating that ADR will not be utilized will not in any way 
    preclude the parties from engaging in informal ADR techniques during 
    the course of adjudication.
    
    Binding Arbitration
    
        The ABA takes issue with the language of Sec. 17.33(f), which 
    permits the FAA Administrator a limited amount of time within which to 
    ``opt-out'' of an arbitrator's decision in binding arbitration, arguing 
    that such a provision conflicts with the policies enunciated in the 
    Administrative Dispute Resolution Act of 1996. Accordingly, the ABA 
    recommends deletion of such language.
        FAA Response: The FAA disagrees. Under 5 U.S.C. 575(c), any binding 
    arbitration undertaken by a Federal agency must be in accordance with 
    guidance issued by the head of the agency in consultation with the 
    Attorney General, i.e, the Department of Justice (DoJ). As of this 
    time, DoJ has advised that federal agencies, including the FAA, may not 
    engage in any form of binding arbitration without the kind of ``opt-
    out'' provision described in proposed Sec. 17.33(f). The language with 
    which the ABA takes issue does not mandate this form of binding 
    arbitration, but merely makes it a permissible form. Since any form of 
    ADR will require the concurrence of both parties, the FAA does not see 
    any necessity for eliminating this alternative and has not done so in 
    the final rule. The language of the first sentence of Sec. 17.33(f) 
    would allow for binding arbitration without such an ``opt out'' 
    provision, pursuant to 5 U.S.C. 575 (a), (b), and (c), so long as the 
    arbitration process is consistent with current DoJ guidance and 
    ``applicable law.'' Thus, if DoJ modifies its guidance to the agencies 
    so as to allow such binding arbitration, the FAA would not need to 
    revise Sec. 17.33 in order to pursue such a dispute resolution option.
    
    Proposed Appendix A to Part 17
    
        The ABA states that it endorses the proposed Appendix A to Part 17 
    and suggests that it be enhanced with additional information concerning 
    ADR experience at the ODRA.
        FAA Response: The FAA disagrees that additional information 
    concerning ODRA's ADR experiences should be contained in the rule. The 
    FAA believes information of this type should be published in the ODRA 
    Website Guide, rather than as part of a procedural regulation.
    
    Distribution of Decisions
    
        The ABA proposes that the rule contain language requiring the 
    distribution of final decisions and suggests that language in 4 CFR 
    21.12, pertaining to the distribution of GAO decisions, be used for 
    that purpose.
        FAA Response: The FAA concurs with the ABA's comment, and has 
    incorporated language concerning the public dissemination of ODRA 
    findings and recommendations relating to both protests and contract 
    disputes, as part of Secs. 17.37(l) and 17.39(l), respectively. 
    Currently, ODRA findings and recommendations and final orders of the 
    Administrator regarding protests and contract disputes are promptly 
    published on the ODRA Website.
    
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    Retroactivity
    
        The ABA points out that the proposed rules are silent on the issue 
    of retroactive applicability and recommends that the final rule 
    identify the contracts to which the new regulations will apply.
        FAA Response: The FAA agrees. Section 17.1, Applicability, has been 
    modified to indicate that the rule will apply to all protests and 
    contract disputes on or after the effective date of these regulations, 
    with the exception of contract disputes relating to pre-AMS contracts.
    
    Definition of ``Interested Party''
    
        The ABA recommends that Sec. 17.3(k) incorporate the same 
    definition of ``interested party'' as is contained in the GAO bid 
    protest regulations.
        FAA Response: The FAA agrees. The definition of ``interested 
    party'' in Sec. 17.3(k) has been modified to incorporate language based 
    upon the definition of ``protester'' in Appendix C to the AMS. That 
    language was patterned after the GAO's definition of ``interested 
    party.''
    
    Intervention
    
        The ABA suggests that the definition of ``intervenor'' in 
    Sec. 17.3(l) should state that the awardee of a contract be given 
    ``intervenor'' status as a matter of right, that the definition include 
    a deadline for requests for intervention, and that a five-day period be 
    used.
        FAA Response: The FAA agrees that the awardee of a contract should 
    be given ``intervenor'' status as a matter of right but disagrees that 
    a five-day period be used as a deadline for requesting intervenor 
    status. Section 17.3(l) has been modified to mandate that contract 
    awardees be allowed intervention as a matter of right. The definition 
    has also been clarified to state that for post-award protests, other 
    than the awardees, no other interested parties will be allowed to 
    participate as intervenors. This conforms to an ODRA interlocutory 
    decision in the Protests of Camber Corp. and Information Systems of 
    Networks Corp., 98-ODRA-00079 and 98-ODRA-00080 (Consolidated) and is 
    consistent with GAO procedures regarding intervention in protests.
        Proposed Sec. 17.15(f) had already established a deadline of two 
    business days for requests of intervenor status. The two day period has 
    not been increased to five days, in light of the ODRA's policy of 
    providing expedited adjudication and dispute resolution.
    
    Parties
    
        The ABA notes that the definition of ``Parties'' under Sec. 17.3(o) 
    uses the word ``protester'' in the singular, implying that only one 
    protester may be involved in a protest before the ODRA. The ABA 
    suggests the use of the plural.
        FAA Response: The FAA agrees with the ABA's comment and has 
    modified the definition under Sec. 17.3(o) accordingly.
    
    Screening Information Request
    
        The ABA finds the current definition of ``Screening Information 
    Request'' in Sec. 17.3(q) to be vague, and suggests alternative 
    language along the lines found in the AMS definition of that term.
        FAA Response: The FAA agrees and has incorporated AMS language into 
    Sec. 17.3(q) similar to that offered by the ABA.
    
    Matters Not Subject to Protest
    
        The ABA finds proposed Sec. 17.11, which identifies matters that 
    are not subject to protest, to be overly broad. The ABA contends that 
    this section prevents parties from protesting such matters in any other 
    alternative forum.
        FAA Response: The FAA disagrees that this section is overly broad. 
    The AMS does not contemplate such matters to be protestable in any 
    forum.
    
    Commencement of the Protest
    
        The ABA questions the use of the word ``cannot'' in Proposed 
    Secs. 17.13(d) and 17.17(d) when those sections refer to the use of 
    ADR, stating that it implies that the parties can only resort to the 
    Default Adjudicative Process where ADR is not possible. The ABA 
    suggests that the phrase ``will not'' be substituted for ``cannot'', so 
    as to allow the parties more flexibility for the use of adjudication 
    under the Default Adjudicative Process.
        FAA Response: The FAA agrees. It was not the FAA's intent to limit 
    the Default Adjudicative Process to cases where ADR is not possible. 
    ADR, in all instances, must be voluntary, in order to be successful. By 
    the same token, the ODRA's procedures are structured so as to assure 
    that ADR techniques are given adequate consideration. The FAA has 
    modified the language of the two sections as recommended by the ABA.
    
    Suspension of Procurement
    
        AMS Sec. 3.9.3.2.1.6 contains a presumption that procurement 
    activities will not be suspended during the pendency of a protest, 
    unless there is a compelling reasons to do so. The AMS authorizes the 
    ODRA to recommend to the Administrator that all or part of such 
    activities be suspended when a protest is filed. The proposed rule at 
    Sec. 17.13(g) contains similar provisions. The ABA urges that the 
    ``regulatory presumption'' against suspension be dropped, arguing that 
    permitting performance to proceed during the pendency of a protest 
    precludes an effective remedy.
        In the alternative, the ABA suggests that protesters be allowed to 
    respond to the agency's position regarding a requested suspension. It 
    further recommends that the rule contain authority for the ODRA to 
    ``tailor the suspension to the specific exigencies of the protest by 
    providing for consideration of limited or partial suspensions.'' 
    Finally, the ABA questions the effectiveness of the authority for 
    suspension being lodged at the Administrator's level and suggests that 
    such authority be provided at the ODRA, so as to assure expeditious 
    handling of suspension requests.
        FAA Response: The FAA agrees in part and disagrees in part. One of 
    the major features of the Competition in Contracting Act (CICA) is its 
    automatic procurement stay provision pertaining to bid protests filed 
    with the General Accounting Office. Section 348 of Public Law 104-50 
    mandated the creation of the AMS to provide for the ``unique needs'' of 
    the FAA. By enacting this law, Congress sought in part to remedy 
    unacceptable delays that had been encountered with FAA procurement. In 
    Public Law 104-50, the Congress expressly exempts the FAA and its new 
    AMS from the provision of statutes governing procurements at other 
    Federal agencies, including notably with CICA. Thus, it was the intent 
    of Congress that the CICA's automatic procurement should not be made 
    part of the process for resolution of bid protests under the AMS. The 
    presumption that contract performance be permitted to proceed, absent 
    compelling reasons, gives effect to the intent of Congress that the FAA 
    implement a system under which acquisitions are accomplished 
    expeditiously. For this reason, the FAA will not adopt the ABA's 
    suggestion that the presumption be dropped.
        However, the final rule does adopt other ABA suggestions regarding 
    suspension. It permits a protester to provide a response to the agency 
    position, prior to the ODRA deciding on whether or not it will 
    recommend suspension to the Administrator. Also, the final rule makes 
    clear that suspensions may be tailored such that they are limited or 
    partial suspension. As to the suggestion that suspension authority be 
    delegated by the Administrator to the ODRA, it should be noted that, by 
    delegation of July 29, 1998, the Administrator delegated to the ODRA 
    Director the authority to issue
    
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    temporary stays for up to ten (10) business days, pending any 
    Administrator's decision on a more permanent stay. That delegation was 
    published in the Federal Register on September 14, 1998 (Federal 
    Register Vol. 63, No. 177, at pp. 49151-49152). A copy may be found on 
    the ODRA Website. The FAA believes that this delegation is sufficient 
    to provide expeditious treatment of suspension requests.
    
    Product Team Response
    
        The ABA raises several issues regarding the Product Team Response 
    required by Sec. 17.17(f) of the proposed rule. (It should be noted 
    that the term ``Product Team'' has been substituted for the term 
    ``Program Office'' throughout the final rule, so as to be more 
    consistent with terminology used in the FAA's AMS, and has been defined 
    so as to conform to the AMS). First, the ABA objects to the language 
    which requires the Response to include all documents which the Product 
    Team ``deem(s) relevant,'' urging that an ``objective'' standard for 
    relevance should be applied. Second, the ABA suggests that, to assure 
    that all relevant documents are provided, the Product Team be required 
    to furnish, in advance of the Response submission, a list of documents 
    to be included with the Response. Third, the ABA points out that the 
    proposed rule fails to require the submission of a Product Team 
    Response in the event the matter proceeds to ADR and the ADR is 
    unsuccessful.
        FAA Response: The FAA agrees that an objective standard of 
    relevance is needed and that the rule needs to require the submission 
    of a Product Team Response in the event ADR is unsuccessful. The 
    language of Sec. 17.17(f) has been modified to require simply the 
    provision of ``all relevant documents''--thus invoking an ``objective'' 
    standard of relevance. As to the matter of requiring submission of a 
    Product Team Response in the event ADR is unsuccessful, the new 
    Sec. 17.17(h) satisfies this concern.
        As to the ABA suggestion regarding the furnishing of a list of 
    documents in advance of the Product Team Response, the FAA does not 
    concur with this suggestion. Such a requirement would mean one more 
    written submission in a process that is to be focused on expediting 
    dispute resolution and eliminating unnecessary paperwork.
    
    Dismissal or Summary Decision of Protests--Opportunity to Respond
    
        The ABA suggests that a new section be inserted into the rule to 
    permit parties against whom a dismissal or summary decision is to be 
    entered the opportunity of submitting to the ODRA a response, before 
    the ODRA acts to recommend dismissal or summary decision.
        FAA Response: The FAA agrees. A new Sec. 17.19(e) has been 
    included, which contains the suggested language.
    
    Default Adjudicative Process for Protests--Discovery
    
        The ABA finds absent from the proposed language of Sec. 17.37(f) 
    guidance regarding the standard to be employed by the Dispute 
    Resolution Officer (DRO) or Special Master when considering the 
    necessity for and scope of discovery in conjunction with protests. The 
    proposed rule is criticized for lack of ``predictability.'' The ABA 
    suggests substitute language for Sec. 17.37(f).
        FAA Response: The FAA has adopted most, but no all of the suggested 
    language for Sec. 17.37(f). Although ``predictability'' is certainly a 
    laudable goal, to achieve the major FAA goal of expeditious dispute 
    resolution, significant flexibility in the process must also be 
    maintained. What may be an appropriate level of discovery in one case 
    may be wholly unwarranted in another. Accordingly, the language of the 
    final rule, while providing additional guidance as to the types of 
    discovery that may be allowed, continues to authorize the DRO or 
    Special Master to exercise broad discretion in terms of managing 
    discovery in each case.
    
    Comments on Product Team Response
    
        The ABA points out that the proposed rule omits any procedure for 
    allowing comments by protesters and intervenors on the Product Team 
    Response.
        FAA Response: The FAA agrees. This omission was inadvertent and 
    contrary to current ODRA practice. Section 17.37(c) of the final rule 
    requires the submission of such comments within five (5) business days 
    of the filing of the Product Team Response.
    
    Hearings
    
        The ABA notes that proposed Sec. 17.37(g) speaks of ``oral 
    presentation'' and does not distinguish between hearings and oral 
    argument. The ABA suggests language that would provide additional 
    guidance on when hearings would be conducted. Such language, the ABA 
    urges, is needed to establish ``predictability'' regarding the ODRA 
    process.
        FAA Response: The FAA agrees. The final rule has been modified 
    regarding ODRA hearings. More specifically, the final rule states that 
    they are to be held ``where the DRO or Special Master determines that 
    there are complex factual issues in dispute that cannot adequately or 
    efficiently be developed solely by means of written presentations and/
    or that resolution of the controversy will be dependent on an 
    assessment of the credibility of statements provided by individuals 
    with first-hand knowledge of the facts.'' In addition, the final rule 
    permits any party to a protest to request the ODRA to conduct a hearing 
    and, in connection with any such request, provides that the ODRA shall 
    conduct a hearing whenever one is requested, unless it finds that one 
    is not necessary and that neither party will be prejudiced by limiting 
    the record in the adjudication to the parties' written submissions. The 
    final rule makes clear that all witnesses at such hearings will be 
    subject to cross-examination by the opposing party and to questioning 
    by the DRO or Special Master.
    
    Commencement of Default Adjudicative Process
    
        The ABA takes issue with the provisions of proposed Sec. 17.37(a) 
    calling for the Default Adjudicative Process to commence on the later 
    of (1) the filing of the Product Team Response, or (2) the submission 
    to the ODRA of a joint notification that the ADR process has not 
    resolved all outstanding issues, or that the 20 business day ADR period 
    has or will expire with no reasonable probability of the parties 
    achieving a resolution. The ABA states that this formulation creates a 
    ``significant disincentive for any protester to elect to proceed with 
    the ADR process,'' since, once ADR is elected, the Default Adjudicative 
    Process cannot start for at least 20 business days. The ABA urges that 
    either party be permitted to ``trigger'' the Default Adjudicative 
    Process at any time during ADR and recommends that the commencement of 
    the Default Adjudicative Process be measured from the filing of a 
    Product Team Response in all instances.
        FAA Response: The FAA concurs that ADR is not intended to be and 
    should not be an obstacle to efficient case resolution. Therefore, 
    under new Sec. 17.17(g), any party will be able to ``trigger'' the 
    Default Adjudicative Process by notifying the ODRA that the parties 
    have failed to achieve a complete resolution of the protest via ADR. 
    Joint notification is no longer being required. Under Sec. 17.37(a) of 
    the final rule, the commencement of the Default Adjudicative Process is 
    marked in all cases by the filing of the Product Team Response. The 
    language regarding expiration of the 20 business day period has been 
    deleted entirely.
    
    [[Page 32931]]
    
    Use and Definition of the Term ``Contract Dispute''
    
        The ABA suggests that the term ``contract dispute'' be changed to 
    ``contract claim'' in various sections of the proposed rule and that 
    separate definitions be provided for both ``contract claim'' and 
    ``contract dispute.''
        FAA Response: The FAA agrees. The definition of ``contract 
    dispute'' has been clarified in the final rule. The term ``claim'' has 
    now been incorporated within that definition. Additional language has 
    been inserted into the definition of ``contract dispute'' in order to 
    clarify that the term includes situations where (1) parties to 
    contracts pre-dating the AMS elect generally to make such contracts 
    ``subject to the AMS,'' including the ODRA dispute resolution process; 
    and (2) parties to such contracts, even where they do not make such a 
    general election, agree to permit the ODRA to employ ADR techniques to 
    resolve disputes under those contracts.
    
    ``Accrual'' of a Contract Dispute
    
        The ABA believes that the definition of ``accrual of a contract 
    dispute'' is ambiguous and recommends that the FAA adopt a definition 
    used by the Court of Federal Claims under the Tucker Act, or 
    alternatively, adopt the definition of accrual that is incorporated 
    into FAR Sec. 33.201.
        FAA Response: The FAA agrees. The FAA has adopted the Court of 
    Federal Claims definition of ``accrual of a contract claim'' and has 
    included it in Sec. 17.3(b) of the final rule. Minor changes have been 
    made to the ABA's proposed language so as to clarify that the 
    determination as to whether there has been ``active concealment or 
    fraud'' or facts ``inherently unknowable'' will rest with the ODRA 
    (and, ultimately, with the Administrator).
    
    Informal Resolution
    
        The ABA finds confusing the provision in Sec. 17.23(d) regarding an 
    extension of the time under Sec. 17.27 for the filing of a joint 
    statements, in particular, whether the parties are entitled to only one 
    extension.
        FAA Response: The FAA agrees that the provision is confusing. The 
    FAA has clarified the provision in proposed Sec. 17.23(d) making plain 
    that extensions for up to twenty (20) business days will be allowed by 
    the ODRA, if informal resolution of the contract disputes appears 
    probable.
    
    Continued Performance
    
        The ABA and AGC seek clarification as to the provision of proposed 
    Sec. 17.23(f) regarding the requirement for continued performance, 
    pending resolution of a contract dispute. They also suggest that the 
    FAA consider providing financing for such continued performance.
        FAA Response: The FAA has decided to eliminate the provision in 
    question from the final rule, since it relates to a matter of contract 
    administration, rather than to procedures before the ODRA. The issues 
    involved will be governed by the express terms of the pertinent FAA 
    contract.
    
    Filing Contract Disputes
    
        The ABA suggests that FAA-initiated contract disputes not be 
    considered as having been ``filed'' until they are received by the 
    contractor from the contracting officer. The ABA perceives 
    Sec. 17.25(a) and (b) as pertaining only to contractor initiated 
    disputes.
        FAA Response: The FAA disagrees. The sections, as drafted, were 
    intended to cover both contractor-initiated and FAA-initiated disputes. 
    In order for the ODRA to manage the dispute resolution process 
    properly, the time for commencement in either case must be measured by 
    the ODRA's receipt of the contract dispute. Just as there need not be 
    an initial submittal of a claim to an FAA contracting officer (CO) and 
    the issuance of a CO final decision as prerequisites to the contractor 
    filing a contract dispute with the ODRA, the same must be true for 
    claims against contractors by FAA product teams. Any concern regarding 
    the contractor having adequate notice of the FAA's claim is satisfied 
    by the provision of Sec. 17.25(d), which requires service if a copy of 
    the contract dispute by means reasonably calculated to be received on 
    the same day as the contract dispute is filed with the ODRA.
    
    Six Months' Time Limit
    
        The ABA questions the six month time limitation specified by 
    Sec. 17.25(c) for the filing of contract disputes and suggests that the 
    limitation be extended to six years, so as to conform to that 
    established by the Federal Acquisition Streamlining Act of 1994, Public 
    Law 103-355, 108 Stat. 3243 (1994)(``FASA'') for claims under the CDA. 
    The ABA further suggests that the time limitation be identical for both 
    contractor and FAA claims. Proposed Sec. 17.25(c) concerns the 
    possibility of different time limitations established by contract 
    provision, and the requirement that such provisions govern over the 
    limitation period set forth in the rule. The ABA proposes that, if the 
    contract specified period is less than six years, it will only be 
    enforced on the contractor if agreed to, and if the failure to agree 
    does not constitute grounds for denying contract award. The ABA 
    suggests language for Sec. 17.25(c) to address this modification. 
    Finally, with regard to the exception of the time limitation for FAA-
    initiated claims relating to warranty, fraud, or latent defects, the 
    ABA suggests that that exception be conditioned on there being a 
    limitation imposed on the FAA for filing of such claims. Specifically, 
    the ABA would bar any such claims if filed more than six years after 
    the FAA knows or should have known of the ``warranty issues, fraud or 
    latent defects.''
        FAA Response: The FAA agrees that the limitation period should be 
    identical for both contractor and government claims. However, the FAA 
    does not accept the suggestion that that period should be six years. 
    The FASA, which amended the CDA to implement a six year time 
    limitation, is a statute which is expressly excluded from applicability 
    to the AMS. The FAA believes that the two (2) year limitation period 
    incorporated in the final rule (subject only to different periods 
    specified in contracts entered into prior to the effective date of this 
    rule) would be less disruptive to the operations of the FAA's product 
    teams. Such a time limitation would allow adequate opportunity for 
    resolution of contract claims at the contracting officer level and 
    would not necessitate the filing of protective litigation.
        The FAA does agrees that there should be some limitation on 
    contract disputes before the ODRA relating to FAA claims against 
    contractors for gross defects amounting to fraud and/or latent defects. 
    Accordingly, the final rule provides for the same two (2) year time 
    limitation to apply to such contract disputes, the two (2) year period 
    to begin from the point when the FAA knew or should have known of the 
    fraud or latent defects. Regarding warranty claims, the time limitation 
    for asserting such claims would be that specified in any contract 
    warranty provision. As for any potential variations in time limitations 
    established by contract provision, the final rule allows such variances 
    only in terms of longer time limitations. The two (2) year period thus 
    is established as a minimum.
    
    Right to an Adjudicative Hearing
    
        The ABA urges that a hearing be provided as a matter of right in 
    all contract disputes under the Default Adjudicative Process and opines 
    that such a hearing would be essential to ensure due process of law.
        FAA Response: The FAA disagrees that a hearing must be provided
    
    [[Page 32932]]
    
    automatically as a matter of right in every case. Even so, the FAA is 
    committed to providing fair and complete consideration of all relevant 
    evidence pertaining to the contract disputes before the ODRA. 
    Accordingly, the final rule, while emphasizing that the ODRA DRO or 
    Special Master will have discretion as to whether a hearing will be 
    conducted in any given case, provides guidance as to when hearings will 
    be conducted. More specifically, Sec. 17.39(h) now calls for hearings 
    ``where the DRO or Special Master determines that there are complex 
    factual issues in dispute that cannot adequately or efficiently be 
    developed solely by means of written presentations and/or that 
    resolution of the controversy will be dependent on his/her assessment 
    of the credibility of statements provided by individuals with first-
    hand knowledge of the facts.'' The final rule also permits any party to 
    a contract dispute to request the ODRA to conduct a hearing and calls 
    for the ODRA to conduct a hearing and calls for the ODRA to conduct 
    hearings whenever requested, unless it finds specifically that the lack 
    of a hearing will not result in prejudice to either party. The final 
    rule makes clear that all witnesses at such hearings will be subject to 
    cross-examination by the opposing party and to questioning by the DRO 
    or Special Master.
    
    Discovery
    
        The ABA suggests that the Default Adjudicative Process for contract 
    disputes fails to afford participants the opportunity for ``full 
    discovery'' and takes issue with the language of proposed 
    Sec. 17.39(e)(1), which calls for DRO or Special Master to determine 
    the ``minimum amount of discovery required to resolve the dispute.'' 
    Further, the ABA asserts that the matter of discovery should be left to 
    the control of each party, ``subject only to the long-established rules 
    of reasonableness and relevance.''
        FAA Response: The FAA agrees. The final rule at Sec. 17.39(e)(1) 
    was revised to speak of the ``appropriate amount of discovery required 
    to resolve the dispute.'' This language addresses the ABA's concern 
    regarding the sue of the term ``minimum.'' As to the matter of who 
    controls the discovery process, the definition of discovery in the 
    final rule, Sec. 17.34(i), in addition to contemplating ODRA management 
    and direction as to discovery, was revised to provide for voluntary 
    discovery by the parties.
    
    Interest
    
        The ABA and AGC take issue with the proposed Sec. 17.34(m), which 
    deals with the recovery of interest on contractor claims, and suggests 
    that the FAA would be subject to the payment of interest under the CDA. 
    They recommend, ``at a minimum, the FAA provide, by regulation, 
    entitlement to interest.''
        FAA Response: The FAA disagrees that the CDA has applicability to 
    contract claims under the AMS. In any event, because the payment of 
    interest would be a matter of contract administration, rather than ODRA 
    procedure, the provision in question has been eliminated from the final 
    rule. The issue of interest is to be governed by the terms of FAA 
    contract documents.
    
    Procedural Predictability and Efficiency
    
        The ABA generally raised concerns regarding the rule's ``clarity 
    and predictability'', claiming that the rule should strive to minimize 
    litigation over procedural issues. The ABA asserts that the rules must 
    afford ``adequate administrative and judicial processes and remedies 
    that provide for the independent, impartial, efficient and just 
    resolution of controversies.''
        FAA Response: The FAA agrees. To promote the goal of minimizing 
    litigation over procedural issues, and to provide clarity and 
    predictability, several sections of the rule were revised. Section 
    17.13(d) now calls for status conference for protests to be mandatory 
    (using the work ``shall'' rather than ``may''), in order to satisfy 
    process predictability concerns. Likewise, Sec. 17.5(b) has been 
    clarified so as to indicate that the ODRA has authority, within its 
    delegation from the Administrator, to ``impose sanctions or [take] 
    other disciplinary actions'' in furtherance of the ``efficient 
    resolution of disputes.''
        For the sake of clarity, Sec. 17.13(c) was revised to include 
    additional language, making clear that the ODRA may extend for good 
    cause specified time limitations other than for the initial protest 
    filing. Proposed Sec. 17.13(e), which seemed to allow the ODRA to waive 
    the limitation regarding initial protest filings, has been deleted to 
    eliminate an apparent ambiguity regarding such waiver.
        A new Sec. 17.13(e) has been inserted to state what had initially 
    been contained in proposed Sec. 17.17(a), that the ODRA Director will 
    designate either Dispute Resolution Officers (DROs) or Special Masters 
    for protests. Inclusion of this new section is consistent with the 
    ABA's goal of process predictability. The additional reference to 
    ``Special Masters'' in Sec. 17.17 (e) and (f) was to clarify that DROs 
    are not used in every case.
        New Sec. 17.17(a) (former Sec. 17.17(b)) includes the words ``as 
    part of protest'' to clarify that the request for a suspension is to be 
    part of the protest document itself. Section 17.17(b)(50 of the final 
    rule (formerly Sec. 17.17(c)(5)) adds the clarifying language ``or 
    arrange for';' to the word ``conduct'' to cover situations where an 
    outside neutral has been agreed upon to handle ADR proceedings, 
    including the provision of early neutral evaluation. This section 
    likewise has been revised by inserting for that purpose the words ``or 
    other Neutral or Compensated Neutral, at the discretion of the ODRA, 
    and/or based upon the agreement of the parties or request of any 
    party(ies) seeking such evaluation.'' This clarifying language foster 
    process predictability.
        Section 17.17(c)(1) has been clarified to call for a joint 
    statement where the parties have decided to ``pursue ADR proceedings in 
    lieu of adjudication in order to resolve the protest'' (instead of 
    merely referring to their decision to ``pursue ADR to resolve the 
    protest''). The phrase ``A joint written explanation'' in 
    Sec. 17.17(c)(2) has been clarified to read ``Joint or separate written 
    explanations,'' to recognize the possibility that the parties may not 
    agree to a joint submission. The balance of that paragraph has been 
    revised to eliminate reference to the term ``parties,'' since 
    intervenors (included within the definition of ``parties'') do not 
    participate in the decision to pursue ADR. Sections 17.17 (d) and (e) 
    of the final rule use the phrases ``Product Team and protester'' and 
    ``Product Team or protester'' for this same reason.
        Section 17.17(d) has been clarified to explicitly state that 
    ``Agreement of any intervenor(s) to the use of ADR or the resolution of 
    a dispute through ADR shall not be required.'' Section 17.17(e) has 
    also been clarified to state that the ODRA may alter the schedule for 
    filing of the Product Team response, in order to accommodate 
    requirements of a particular protest. These clarifying revision support 
    the goal of minimizing litigation over procedural issues.
        Section 17.17(f) clarifies the time for circulating to other 
    parties copies of the Product Team Response and requires a more 
    specific format for the information to be provided as part of the 
    Product Team Response. The timing for provision of copies of the 
    Product Team response to the protester and intervenor has been 
    clarified to require that such copies be furnished on the same date as 
    it is filed with the ODRA, if practicable, but in any event no later 
    than one (1) business day after such filing. Similarly, Sec. 17.25(a) 
    specifies more explicitly the format to be used for contract dispute 
    filings for those reasons. Section 17.19(a)(2) clarifies the basis for
    
    [[Page 32933]]
    
    possible dismissal or summary dismissal of a protest to state that such 
    dismissal may be done if the protest is ``frivolous, without basis in 
    factor law, or (fails) to state a claim upon which relief may be had.`'
        Two potential protest remedies previously grouped (recompetition 
    and termination for convenience) are stated separately in Sec. 17.21(a) 
    of the final rule, to clarify an ambiguity as to whether the ODRA may 
    recommend one or both of these remedies in any given case. Section 
    17.23(a) of the final rule has been clarified to include the phrase 
    ``subject to the AMS, ``rather than ``entered into pursuant to the 
    AMS,'' in order to cover situations where parties to a pre-AMS contract 
    opt to subject the contract to the AMS and its ODRA dispute resolution 
    process. Again, these changes foster process predictability.
        A substitute Sec. 17.23(f) has been inserted (in lieu of the 
    deleted Sec. 17.23(f), which had dealt with the obligation to continue 
    performance pending resolution of a dispute). The substitute section 
    provides a remedies section for contract disputes. This section 
    parallels the remedies section for bid protests and serves to make the 
    provisions of the rule consistent.
        Section 17.27(a) is revised to allow the parties twenty (20) 
    business days to submit a joint statement in order to promote 
    expeditious resolution. It also uses the phrases ``joint or separate 
    statements'' and ``written explanation(s,)'' in recognition of the 
    possibility that parties may not be willing to agree to a joint 
    submission section information 17.27(d) has been revised by deleting 
    the word ``joint'' for the same reason. However, when speaking of a 
    request for ADR, Sec. 17.27(b)(1) specifies that such request must be 
    ``joint.'' This is in recognition that ADR is a voluntary process that 
    must be mutually entered into by the parties.
        To foster predictability of the process, Sec. 17.31(b) was revised 
    to insert language clarifying that in all cases the parties will be 
    expected to explore ADR. Additional clarifying language was included in 
    that section to address the assignment by the ODRA of a DRO to explore 
    ADR options with the parties and to arrange for early neutral 
    evaluation of the merits of a case, at a party's request. The final 
    rule has been revised to delete Sec. 17.359c), which had provided for 
    the automatic appointment of a DRO for small dollar value matters or 
    matters involving simplified acquisitions, so long as such appointment 
    was not objected to by the parties. Specifying the automatic use of ADR 
    in this context was inconsistent with the balance of the ADR section of 
    the rule and was considered contrary to the basis concept that ADR is 
    to be a completely voluntary process.
        Section 17.37(b) clarifies that it is the Director of the ODRA who 
    selects the DRO or Special Master to conduct fact findings; thus 
    serving the interest of process predictability. Section 17.37(j) has 
    been clarified to state only that, in arriving at findings and 
    recommendations relating to protests, DROs and Special Masters are to 
    ``consider'' whether or not the Product Team actions in question had a 
    rational basis, and whether or not the Product Team decision under 
    question was arbitrary, capricious or an abuse of discretion.
        Finally, a new Sec. 17.45 has been added to address concerns 
    regarding predictability in the relationship of this rule to changes in 
    future FAA policy. This section requires all amendments to the AMS, 
    standard contract forms and clauses,and any guidance to FAA contracting 
    officials, to conform with the provisions of the final rule.
    
    Additional Clarifying Changes in the Final Rule
    
        In addition to the revisions of the proposed rule made in response 
    to comments received, the FAA has made a number of revisions in order 
    to clarify the language of the rule and to correct awkward language 
    without substantive changes. More specifically, 14 CFR Part 14, 
    Sec. 14.05(b) was modified to add the language ``or such rate as 
    prescribed by 5 U.S.C. 504,''in order to include any subsequent rate 
    adjustments that might be permitted for attorneys' fees and other costs 
    under revisions to the EAJA. Section 14.05(e) was modified to provide 
    EAJA recovery for attorneys' fees and costs incurred in the Default 
    Adjudicative Process under 14 CFR part 17 and the AMS.
        Section 17.7(d) was deleted and its language combined with similar 
    language in Sec. 17.43. Section 17.11, which had previously made non-
    protestable ``FAA purchased from or through federal * * * governments'' 
    now reads ``FAA purchases from or through other federal agencies.'' 
    Section 17.13(c) was revised to add the word ``protest'' in describing 
    filing time limitations, for the sake of clarity. Section 17.13(c) was 
    revised to correct a mistaken reference to Sec. 17.17 (now referring to 
    Sec. 17.15). Section 17.13(d) has been modified to eliminate redundancy 
    with other sections and now merely makes cross-reference to those 
    sections.
        The words ``for adjudication'' were included in Sec. 17.17(f) for 
    the sake of clarity. Section 17.15(a)(3) has been revised to clarify 
    ambiguities in the language regarding protest filing timeliness. The 
    wording of Sec. 17.15(f) has been rearranged and the language ``if 
    known'' added to the requirement for notifying other interested parties 
    of the existence of a protest, so as to clarify the obligation of the 
    FAA Contracting Officer. Former Sec. 17.17(a) has been eliminated, 
    since its content had been inserted as new Sec. 17.13(e).
        The word ``part'' in Sec. 17.23(a) has been revised to read 
    ``subpart,'' to clarify that the covered contract disputes are to be 
    resolved under subpart C of the rule, entitled ``Contract Disputes.'' 
    Rather than have a redundant provision for the ODRA's granting of time 
    extensions, Sec. 17.27(a) of the final rule merely contains a cross-
    reference to Sec. 17.23(d). In Sec. 17.29(d) of the final rule, the 
    words ``or the Administrator's delegee'' have been added to conform to 
    other references to Administrator's orders within the rule. To avoid 
    confusion, the words ``Associate Chief Counsel and'' were deleted from 
    both Secs. 17.37(l) and 17.39(l).
        Former Sec. 17.37(m) was eliminated as redundant to Subpart F 
    regarding final orders. In its stead, the final rule contains a 
    clarifying provision with respect to ODRA time extensions. This same 
    substitution was made for former Sec. 17.39(m) as well. Besides 
    eliminating redundancies in the rule, these substitutions also satisfy 
    the ABA's concern for predictability of the process. A new 
    Sec. 17.39(k) was inserted to allow the ODRA Director to confer with 
    the DRO or Special Master during the pendency of adjudication of 
    contract disputes. This insertion was to make the process for contract 
    disputes consistent with that specified for protests. The new 
    Sec. 17.39(k) is virtually identical to the language regarding 
    adjudication of protests and the role of the ODRA Director contained in 
    Sec. 17.37(h). Finally, in Sec. 17.43, the words ``FAA Chief Counsel'' 
    were substituted for ``Product Team attorney'' so as to provide 
    consistency with other FAA regulations.
    
    Paperwork Reduction Act
    
        Information collection requirements in the amendment of 14 part 14 
    and the addition of part 17 to the Code of Federal Regulations (14 CFR 
    parts 14 and 17) have previously been approved by the Office of 
    Management and Budget (OMB) under the provisions of the Paperwork 
    Reduction Act of 1995 (44 U.S.C. 3507(d)), and have been assigned OMB 
    Control Number 2120-0632.
    
    [[Page 32934]]
    
    International Compatibility
    
        The FAA has determined that a review of the Convention on 
    International Civil Aviation Standards and Recommended Practices is not 
    warranted because there is not a comparable rule under ICAO standards.
    
    Federalism Implications
    
        The regulations herein will not have substantial direct effects on 
    the states, on the relationship between the national government and the 
    states, or on the distribution of power and responsibilities among the 
    various levels of government. Therefore, in accordance with Executive 
    Order 12612, it is determined that this rule will not have sufficient 
    federalism implications to warrant the preparation of a Federalism 
    Assessment.
    
    Regulatory Evaluation Summary
    
        Four principal requirements pertain to the economic impacts of 
    changes to the Federal Regulations. First, Executive Order 12866 
    directs Federal agencies to promulgate new regulations or modify an 
    existing regulation after consideration of the expected benefits to 
    society and the expected costs. The order also requires Federal 
    agencies to assess whether a final rule is considered a ``significant 
    regulatory action.'' Second, the Regulatory Flexibility Act of 1980 
    requires agencies to analyze the economic impact of regulatory changes 
    on small entities. Third, the Office of Management and Budget directs 
    agencies to assess the effect of regulatory changes on international 
    trade. Finally, Public Law 104-4, Department of Transportation 
    Appropriations Act (November 15, 1995), requires Federal agencies to 
    assess the impact of any Federal mandates on State, Local, Tribal 
    governments, and the private sector.
        In conducting these analyses, the FAA has determined that this rule 
    will generate cost-savings that will exceed any costs, and is not 
    ``significant'' as defined under section 3(f) of Executive Order 12866 
    and Department of Transportation's (DOT) policies and procedures (44 FR 
    11034, February 26, 1979). In addition, under the Regulatory 
    Flexibility Determination, the FAA certifies that this proposal will 
    not have a significant impact on a substantial number of small 
    entities. Furthermore, this proposal will not impose restraints on 
    international trade. Finally, the FAA has determined that the proposal 
    will not impose a Federal mandate on state, local, or tribal 
    governments, or the private sector of $100 million per year. These 
    analyses, available in the docket, are summarized below.
    
    Executive Order 12866 and DOT's Policies and Procedures
    
        Under Executive Order 12866, each Federal agency shall assess both 
    the costs and the benefits of final regulations while recognizing that 
    some costs and benefits are difficult to quantify. A final rule is 
    promulgated only upon a reasoned determination that the benefits of the 
    final rule justify its costs.
        In this final rule, the establishment of procedures for protests 
    and contract disputes by the Office of Dispute Resolution for 
    Acquisition (ODRA), under the FAA's new Acquisition Management System, 
    will provide a cost savings to the private sector (protesters and 
    contractors). To resolve protests and contract disputes with the FAA, 
    offerors and contractors will realize a cost savings of $1,000 to $1 
    million per case, and the FAA will realize an average cost savings of 
    $2,300 per protest case and $4,400 per contract dispute. Costs for this 
    final rule are estimated to be about $500 or less per case for the 
    private sector to abide by the procedures of the ODRA, and no 
    additional costs will be attributed to the FAA for implementing such 
    procedures. Therefore, the FAA concludes that not only do the benefits 
    justify the costs, but that benefits actually exceed the costs.
        The final rule will also not be considered a significant regulatory 
    action because (1) it does not have an annual effect of $100 million or 
    more or adversely affect in a material way the economy or a sector of 
    the economy, productivity, competition, jobs, the environment, public 
    health or safety, or State, Local or Tribal governments or communities; 
    (2) it does not create a serious inconsistency or otherwise interfere 
    with an action taken or planned by another agency; (3) it does not 
    materially alter the budgetary impact of entitlements, grants, user 
    fees, or loan programs or the rights and obligations of recipients; and 
    (4) it does not raise novel legal or policy issues arising out of legal 
    mandates, the President's priorities or principles set forth in the 
    Executive Order. Because the final rule is not considered significant 
    under these criteria, it was not reviewed by the Office of Management 
    and Budget (OMB) for consistency with applicable law, the President's 
    priorities, and the principles set forth in this Executive Order nor 
    was OMB involved in deconflicting this final rule with ones from other 
    agencies.
    
    Final Regulatory Flexibility Determination
    
        The Regulatory Flexibility Act of 1980 (the Act) establishes ``as 
    principle of regulatory issuance that agencies shall endeavor, 
    consistent with the objective of the rule and of applicable statutes, 
    to fit regulatory and informational requirements to the scale of the 
    business, organizations, and governmental jurisdictions subject to 
    regulation.'' To achieve that and to explain the rationale for their 
    actions, the Act covers a wide-range of small entities, including small 
    businesses, not-for-profit organizations and small governmental 
    jurisdictions.
        Agencies must perform a review to determine whether a final rule 
    will have a significant economic impact on a substantial number of 
    small entities. If the determination is that it will, the agency must 
    prepare a Regulatory Flexibility Analysis (RFA) as described in the 
    Act.
        However, if an agency determines that a final rule is not expected 
    to have a significant economic impact on a substantial number of 
    entities, section 605(b) of the 1980 Act provides that the head of the 
    agency may so certify and an RFA is not required. The certification 
    must include a statement providing the factual basis for this 
    determination, and the reasoning should be clear.
        The FAA conducted the required review of this final rule and 
    determined that it will not have a significant economic impact on a 
    substantial number of small entities (protesters and contractors). 
    Accordingly, pursuant to the Regulatory Flexibility Act, 5 U.S.C. 
    605(b), the FAA certifies that this rule will not have a significant 
    economic impact on a substantial number of small entities for the 
    following reason: the final rule will provide an estimated cost savings 
    of $1,000 to $1 million per case in resolving protests and disputes 
    with the FAA, while requiring about 4500 or less per case per entity to 
    resolve the issue. For small entities, the FAA estimates that cost 
    savings per case will be closer to $1,000 than $1 million and concludes 
    there will be no significant economic impact on small entities. The FAA 
    solicited comments from affected entities with respect to this finding 
    and determination in the Notice of Proposed Rulemaking, and no comments 
    were received.
    
    Final International Trade Impact Assessment
    
        The FAA has determined that the final rule will neither affect the 
    sale of aviation products and services in the United States nor the 
    sale of U.S.
    
    [[Page 32935]]
    
    products and services in foreign countries.
    
    Final Unfunded Mandates Reform Assessment
    
        Title II of the Unfunded Mandates Reform Act of 1995 (the Reform 
    Act) enacted as Public Law 104-4 on March 22, 1995, requires each 
    Federal agency, to the extent permitted by law, to prepare a written 
    assessment of the effects of any Federal mandate in a final agency rule 
    that may result in the expenditure by State, Local, and Tribal 
    governments, in the aggregate, or by the private sector, of $100 
    million or more (adjusted annually for inflation) in any one year.
        Section 204(a) of the Reform Act, 2 U.S.C. 1534(a), requires the 
    Federal agency to develop an effective process to permit timely input 
    by elected officers (or their designees) of State, Local, and Tribal 
    governments on a final ``significant intergovernmental mandate.'' A 
    ``significant intergovernmental mandate'' under the Reform Act is any 
    provision in a Federal agency regulation that will impose an 
    enforceable duty upon State, Local, and Tribal governments, in the 
    aggregate, of $100 million (adjusted annually for inflation) in any one 
    year.
        Section 203 of the Reform Act, 2 U.S.C. 1533, which supplements 
    section 204(a), provides that before establishing any regulatory 
    requirements that might significantly or uniquely affect small 
    governments, the agency shall have developed a plan that, among other 
    things, provides for notice to potentially affected small governments, 
    if any, and for a meaningful and timely opportunity to provide input in 
    the development of regulatory proposals.
        This rule does not contain a Federal intergovernmental or private 
    sector mandate that exceeds $100 million a year, therefore the 
    requirements of the Reform Act do not apply.
    
    List of Subjects
    
    14 CFR Part 14
    
        Claims, Equal access to justice, Lawyers, Reporting and 
    recordkeeping requirements.
    
    14 CFR Part 17
    
        Administrative practice and procedure, Alternative Dispute 
    Resolution (ADR), Protests, Authority delegations (Government 
    agencies), Government contracts, Government procurement.
    
    The Amendment
    
        In consideration of the foregoing, the Federal Aviation 
    Administration amends part 14 and adds part 17 of Title 14, Chapter I, 
    Code of Federal Regulations as follows:
    
    PART 14--RULES IMPLEMENTING THE EQUAL ACCESS TO JUSTICE ACT OF 1980
    
        1. The authority citation for part 14 is revised to read as 
    follows:
    
        Authority: 5 U.S.C. 504; 49 U.S.C. 106(f), 40113, 46104 and 
    47122.
    
        2. Amend Sec. 14.02 by revising paragraph (a) as follows:
    
    
    Sec. 14.02  Proceedings covered.
    
        (a) The Act applies to certain adversary adjudications conducted by 
    the FAA under 49 CFR part 17 and the Acquisition Management System 
    (AMS). These are adjudications under 5 U.S.C. 554, in which the 
    position of the FAA is represented by an attorney or other 
    representative who enters an appearance and participates in the 
    proceeding. This subpart applies to proceedings under 49 U.S.C. 46301, 
    46302, and 46303 and to the Default Adjudicative Process under part 17 
    of this chapter and the AMS.
     * * * * *
        3. Amend Sec. 14.03 by revising paragraph (a) and (f) to read as 
    follows:
    
    
    Sec. 14.03  Eligibility of applicants.
    
        (a) To be eligible for an award of attorney fees and other expenses 
    under the Act, the applicant must be a party to the adversary 
    adjudication for which it seeks an award. The term ``party'' is defined 
    in 5 U.S.C. 504(b)(1)(B) and 5 U.S.C. 551(3). The applicant must show 
    that it meets all conditions or eligibility set out in this subpart.
    * * * * *
        (f) The net worth and number of employees of the applicant and all 
    of its affiliates shall be aggregated to determine eligibility. Any 
    individual, corporation, or other entity that directly or indirectly 
    controls or owns a majority of the voting shares or other interest of 
    the applicant, or any corporation or other entity of which the 
    applicant directly or indirectly owns or controls a majority of the 
    voting shares or other interest, will be considered an affiliate for 
    purposes of this part, unless the ALJ or adjudicative officer 
    determines that such treatment would be unjust and contrary to the 
    purposes of the Act in light of the actual relationship between the 
    affiliated entities. In addition, the ALJ or adjudicative officer may 
    determine that financial relationships of the applicant, other than 
    those described in this paragraph, constitute special circumstances 
    that would make an award unjust.
    * * * * *
        4. Amend Sec. 14.05 by revising paragraphs (b), (c), and (e) to 
    read as follows:
    
    
    Sec. 14.05  Allowance of fees and expenses.
    
    * * * * *
        (b) No award for the fee of an attorney or agent under this part 
    may exceed $125 per hour, or such rate as prescribed by 5 U.S.C. 504. 
    No award to compensate an expert witness may exceed the highest rate at 
    which the agency pays expert witnesses. However, an award may also 
    include the reasonable expenses of the attorney, agent, or witness as a 
    separate item, if the attorney, agent, or witness ordinarily charges 
    clients separately for such expenses.
        (c) In determining the reasonableness of the fee sought for an 
    attorney, agent, or expert witness, the ALJ or adjudicative officer 
    shall consider the following:
        (1) If the attorney, agent, or witness is in private practice, his 
    or her customary fee for similar services, or if an employee of the 
    applicant, the fully allocated cost of the services;
        (2) The prevailing rate for similar services in the community in 
    which the attorney, agent, or witness ordinarily performs services;
        (3) The time actually spent in the representation of the applicant;
        (4) The time reasonably spent in light of the difficulty or 
    complexity of the issues in the proceeding; and
        (5) Such other factors as may bear on the value of the services 
    provided.
    * * * * *
        (e) Fees may be awarded only for work performed after the issuance 
    of a complaint, or in the Default Adjudicative Process for a protest or 
    contract dispute under part 17 of this chapter and the AMS.
        5. Amend Sec. 14.11 by revising paragraph (c) to read as follows:
    
    
    Sec. 14.11  Net worth exhibit.
    
    * * * * *
        (c) Ordinarily, the net worth exhibit will be included in the 
    public record of the proceeding. However, an applicant that objects to 
    public disclosure of the net worth exhibit, or any part of it, may 
    submit that portion of the exhibit directly to the ALJ or adjudicative 
    officer in a sealed envelope labeled ``Confidential Financial 
    Information,'' accompanied by a motion to withhold the information.
        (1) The motion shall describe the information sought to be withheld 
    and explain, in detail, why it should be exempt under applicable law or 
    regulation, why public disclosure would adversely affect the applicant, 
    and why
    
    [[Page 32936]]
    
    disclosure is not required in the public interest.
        (2) The net worth exhibit shall be served on the FAA counsel, but 
    need not be served on any other party to the proceeding.
        (3) If the ALJ or adjudicative officer finds that the net worth 
    exhibit, or any part of it, should not be withheld from disclosure, it 
    shall be placed in the public record of the proceeding. Otherwise, any 
    request to inspect or copy the exhibit shall be disposed of in 
    accordance with the FAA's established procedures.
        6. Amend Sec. 14.20 by revising paragraphs (a) and (c) to read as 
    follows:
    
    
    Sec. 14.20  When an application may be filed.
    
        (a) An application may be filed whenever the applicant has 
    prevailed in the proceeding, but in no case later than 30 days after 
    the FAA Decisionmaker's final disposition of the proceeding, or service 
    of the order of the Administrator in a proceeding under the AMS.
    * * * * *
        (c) For purposes of this part, final disposition means the later 
    of:
        (1) Under part 17 of this chapter and the AMS, the date on which 
    the order of the Administrator is served;
        (2) The date on which an unappealed initial decision becomes 
    administratively final;
        (3) Issuance of an order disposing of any petitions for 
    reconsideration of the FAA Decisionmaker's final order in the 
    proceeding;
        (4) If no petition for reconsideration is filed, the last date on 
    which such a petition could have been filed; or
        (5) Issuance of a final order or any other final resolution of a 
    proceeding, such as a settlement or voluntary dismissal, which is not 
    subject to a petition for reconsideration.
        7. Revise Sec. 14.21 to read as follows:
    
    
    Sec. 14.21  Filing and service of documents.
    
        Any application for an award or other pleading or document related 
    to an application shall be filed and served on all parties to the 
    proceeding in the same manner as other pleadings in the proceeding, 
    except as provided in Sec. 14.11(b) for confidential financial 
    information. Where the proceeding was held under part 17 of this 
    chapter and the AMS, the application shall be filed with the FAA's 
    attorney and with the Office of Dispute Resolution for Acquisition.
        8. Amend Sec. 14.22 by revising paragraph (b) to read as follows:
    
    
    Sec. 14.22 Answer to application.
    
    * * * * *
        (b) If the FAA's counsel and the applicant believe that the issues 
    in the fee application can be settled, they may jointly file a 
    statement of their intent to negotiate a settlement. The filing of this 
    statement shall extend the time for filing an answer for an additional 
    30 days, and further extensions may be granted by the ALJ or 
    adjudicative officer upon request by the FAA's counsel and the 
    applicant.
    * * * * *
        9. Revise Sec. 14.24 to read as follows:
    
    
    Sec. 14.24  Comments by other parties.
    
        Any party to a proceeding other than the applicant and the FAA's 
    counsel may file comments on an application within 30 days after it is 
    served, or on an answer within 15 days after it is served. A commenting 
    party may not participate further in proceedings on the application 
    unless the ALJ or adjudicative officer determines that the public 
    interest requires such participation in order to permit full 
    exploration of matters raised in the comments.
        10. Amend Sec. 14.26 by revising paragraph (a) to read as follows:
    
    
    Sec. 14.26  Further proceedings.
    
        (a) Ordinarily the determination of an award will be made on the 
    basis of the written record; however, on request of either the 
    applicant or agency counsel, or on his or her own initiative, the ALJ 
    or adjudicative officer assigned to the matter may order further 
    proceedings, such as an informal conference, oral argument, additional 
    written submissions, or an evidentiary hearing. Such further 
    proceedings shall be held only when necessary for full and fair 
    resolution of the issues arising from the application and shall be 
    conducted as promptly as possible.
    * * * * *
        11. Revise Sec. 14.27 to read as follows:
    
    
    Sec. 14.27  Decision.
    
        (a) The ALJ shall issue an initial decision on the application 
    within 60 days after completion of proceedings on the application.
        (b) An adjudicative officer in a proceeding under part 17 of this 
    chapter and the AMS shall prepare a findings and recommendations for 
    the Office of Dispute Resolution for Acquisition.
        (c) A decision under paragraph (a) or (b) of this section shall 
    include written findings and conclusions on the applicant's eligibility 
    and status as prevailing party and an explanation of the reasons for 
    any difference between the amount requested and the amount awarded. The 
    decision shall also include, if at issue, findings on whether the FAA's 
    position was substantially justified, or whether special circumstances 
    make an award unjust.
        12. Revise Sec. 14.28 to read as follows:
    
    
    Sec. 14.28  Review by FAA decisionmaker.
    
        (a) In proceedings other than those under part 17 of this chapter 
    and the AMS, either the applicant or the FAA counsel may seek review of 
    the initial decision on the fee application. Additionally, the FAA 
    Decisionmaker may decide to review the decision on his/her own 
    initiative. If neither the applicant nor the FAA's counsel seeks review 
    within 30 days after the decision is issued, it shall become final. 
    Whether to review a decision is a matter within the discretion of the 
    FAA Decisionmaker. If review is taken, the FAA Decisionmaker will issue 
    a final decision on the application or remand the application to the 
    ALJ who issue the initial fee award determination for further 
    proceedings.
        (b) In proceedings under part 17 of this chapter and the AMS, the 
    adjudicative officer shall prepare findings and recommendations for the 
    Office of Dispute Resolution for Acquisition with recommendations as to 
    whether or not an award should be made, the amount of the award, and 
    the reasons therefor. The Office of Dispute Resolution for Acquisition 
    shall submit a recommended order to the Administrator after the 
    completion of all submissions related to the EAJA application. Upon the 
    Administrator's action, the order shall become final, and may be 
    reviewed under 49 U.S.C. 46110.
        13. Add new part 17 to 14 CFR Chapter I, Subchapter B, to read as 
    follows:
    
    PART 17--PROCEDURES FOR PROTESTS AND CONTRACTS DISPUTES
    
    Subpart A--General
    
    Sec.
    
    17.1  Applicability.
    17.3  Definitions.
    17.5  Delegation of authority.
    17.7  Filing and computation of time.
    17.9  Protective orders.
    
    Subpart B--Protests
    
    17.11  Matters not subject to protest.
    17.13  Dispute resolution process for protests.
    17.15  Filing a protest.
    17.17  Initial protest procedures.
    17.19  Dismissal or summary decision of protest.
    17.21  Protest remedies.
    
    Subpart C--Contract Disputes
    
    17.23  Dispute resolution process for contract disputes.
    17.25  Filing a contract dispute.
    17.27  Submission of joint or separate statements.
    
    [[Page 32937]]
    
    17.29  Dismissal or summary decision of contract disputes.
    
    Subpart D--Alternative Dispute Resolution
    
    17.31  Use of alternative dispute resolution.
    17.33  Election of alternative dispute resolution process.
    17.35  Selection of neutrals for the alternative dispute resolution 
    process.
    
    Subpart E--Default Adjudicative Process
    
    17.37  Default adjudicative process for protests.
    17.39  Default adjudicative process for contract disputes.
    
    Subpart F--Finality and Review
    
    17.41  Final orders.
    17.43  Judicial review.
    17.45  Conforming amendments.
    
    Appendix A to Part 17--Alternative Dispute Resolution (ADR)
    
        Authority: 5 U.S.C. 570-581, 49 U.S.C. 106(f)(2), 40110, 40111, 
    40112, 46102, 46014, 46105, 46109, and 46110.
    
    Subpart A--General
    
    
    Sec. 17.1  Applicability.
    
        This part applies to all protests or contract disputes against the 
    FAA that are brought on or after June 28, 1999, with the exception of 
    those contract disputes arising under or related to FAA contracts 
    entered into prior to April 1, 1996.
    
    
    Sec. 17.3  Definitions.
    
        (a) Accrual mean to come into existence as a legally enforceable 
    claim.
        (b) Accrual of a contract claim means that all events relating to a 
    claim have occurred which fix liability of either the government or the 
    contractor and permit assertion of the claim, regardless of when the 
    claimant actually discovered those events. For liability to be fixed, 
    some injury must have occurred. Monetary damages need not have been 
    incurred, but if the claim is for money, such damages must be capable 
    of reasonable estimation. The accrual of a claim or the running of the 
    limitations period may be tolled on such equitable grounds as where the 
    office of Dispute Resolution for Acquisition determines that there has 
    been active concealment or fraud or where it finds that the facts were 
    inherently unknowable.
        (c) Acquisition Management System (AMS) establishes the policies, 
    guiding principles, and internal procedures for the FAA's acquisition 
    system.
        (d) Administrator means the Administrator of the Federal Aviation 
    Administration.
        (e) Alternative Dispute Resolution (ADR) is the primary means of 
    dispute resolution that would be employed by the FAA's Office of 
    Dispute Resolution for Acquisition. See Appendix A of this part.
        (f) Compensated Neutral refers to an impartial third party chosen 
    by the parties to act as a facilitator, mediator, or arbitrator 
    functioning to resolve the protest or contract dispute under the 
    auspices of the Office of Dispute Resolution for Acquisition. The 
    parties pay equally for the services of a Compensated Neutral, unless 
    otherwise agreed to by the parties. A Dispute Resolution Officer (DRO) 
    or Neutral cannot be a Compensated Neutral.
        (g) Contract Dispute, as used in this part, means a written request 
    to the Office of Dispute Resolution for Acquisition seeking resolution, 
    under an existing FAA contract subject to the AMS, of a claim for the 
    payment of money in a sum certain, the adjustment or interpretation of 
    contract terms, or for other relief arising under, relating to or 
    involving an alleged breach of that contract. A contract dispute does 
    not require, as a prerequisite, the issuance of a Contracting Officer 
    final decision. Contract disputes for purposes of ADR only may also 
    involve contracts not subject to the AMS.
        (h) Default Adjudicative Process is an adjudicative process used to 
    resolve protests or contract disputes where the parties cannot achieve 
    resolution through informal communication or the use of ADR. The 
    Default Adjudicative Process is conducted by a DRO or Special Master 
    selected by the Office of Dispute Resolution for Acquisition to serve 
    as ``adjudicative officers,'' as that term is used in part 14 of this 
    chapter.
        (i) Discovery is the procedure where opposing parties in a protest 
    or contract dispute may, either voluntarily or to the extent directed 
    by the Office of Dispute Resolution for Acquisition, obtain testimony 
    from, or documents and information held by, other parties or non-
    parties.
        (j) Dispute Resolution Officer (DRO) is a licensed attorney 
    reporting to the Office of Dispute Resolution for Acquisition. The term 
    DRO can include the Director of the Office of Dispute Resolution for 
    Acquisition, Office of Dispute Resolution for Acquisition staff 
    attorneys or other FAA attorneys assigned to the Office of Dispute 
    Resolution for Acquisition.
        (k) An interested party, in the context of a bid protest, is one 
    whose direct economic interest has been or would be affected by the 
    award or failure to award an FAA contract. Proposed subcontractors are 
    not ``interested parties'' within this definition and are not eligible 
    to submit protests to the Office of Dispute Resolution for Acquisition.
        (l) An intervenor is an interested party other than the protester 
    whose participation in a protest is allowed by the Office of Dispute 
    Resolution for Acquisition. For a post-award protest, the awardee of 
    the contract that is the subject of the protest shall be allowed, upon 
    request, to participate as an intervenor in the protest. In such a 
    protest, no other interested parties shall be allowed to participate as 
    intervenors.
        (m) Neutral refers to an impartial third party in the ADR process 
    chosen by the Office of Dispute Resolution for Acquisition to act as a 
    facilitator, mediator, arbitrator, or otherwise to resolve a protest or 
    contract dispute. A Neutral can be a DRO or a person not an employee of 
    the FAA who serves on behalf of the Office of Dispute Resolution for 
    Acquisition.
        (n) The Office of Dispute Resolution for Acquisition (ODRA), under 
    the direction of the Director, acts on behalf of the Administrator to 
    manage the FAA Dispute Resolution Process, and to recommend action to 
    be the Administrator on matters concerning protests or contract 
    disputes.
        (o) Parties include the protester(s) or (in the case of a contract 
    dispute) the contractor, the FAA, and any intervenor(s).
        (p) Product Team, as used in these rules, refers to the FAA 
    organization(s) responsible for the procurement activity, without 
    regard to funding source, and includes the Contracting Officer (CO) and 
    assigned FAA legal counsel, when the FAA organization(s) represent(s) 
    the FAA as a party to a protest or contract dispute before the Office 
    of Dispute Resolution for Acquisition. The CO is responsible for all 
    Product Team communications with and submissions to the Office of 
    Dispute Resolution for Acquisition through assigned FAA counsel.
        (q) Screening Information Request (SIR) means a request by the FAA 
    for documentation, information, presentations, proposals, or binding 
    offers concerning an approach to meeting potential acquisition 
    requirements established by the FAA. The purpose of a SIR is for the 
    FAA to obtain information needed for it to proceed with a source 
    selection decision and contract award.
        (r) A Special Master is an attorney, usually with extensive 
    adjudicative experience, who has been assigned by the Office of Dispute 
    Resolution for Acquisition to act as its finder of fact, and to make 
    findings and recommendations based upon AMS policy and applicable law 
    and authorities in the Default Adjudicative Process.
    
    [[Page 32938]]
    
    Sec. 17.5   Delegation of authority.
    
        (a) The authority of the Administrator to conduct dispute 
    resolution proceedings concerning acquisition matters, is delegated to 
    the Director of the Office of Dispute Resolution for Acquisition.
        (b) The Director of the Office of Dispute Resolution for 
    Acquisition may redelegate to Special Masters and DROs such delegated 
    authority in paragraph (a) of this section as is deemed necessary by 
    the Director for efficient resolution of an assigned protest or 
    contract dispute, including the imposition of sanctions or other 
    disciplinary actions.
    
    
    Sec. 17.7   Filing and computation of time.
    
        (a) Filing of a protest or contract dispute may be accomplished by 
    mail, overnight delivery, hand delivery, or by facsimile. A protest or 
    contract dispute is considered to be filed on the date it is received 
    by the Office of Dispute Resolution for Acquisition during normal 
    business hours. The Office of Dispute Resolution for Acquisition's 
    normal business hours are from 8:30 a.m. to 5 p.m. est or edt, 
    whichever is in use. A protest or contract dispute received via mail, 
    after the time period prescribed for filing, shall not be considered 
    timely filed even though it may be postmarked within the time period 
    prescribed for filing.
        (b) Submissions to the Office of Dispute Resolution for Acquisition 
    after the initial filing of a contract dispute may be accomplished by 
    any means available in paragraph (a) of this section. Submissions to 
    the Office of Dispute Resolution for Acquisition after the initial 
    filing of a protest may only be accomplished by overnight delivery, 
    hand delivery or facsimile.
        (c) The time limits stated in this part are calculated in business 
    days, which exclude weekends and Federal holidays. In computing time, 
    the day of the event beginning a period of time shall not be included. 
    If the last day of a period falls on a weekend or a Federal holiday, 
    the first business day following the weekend or holiday shall be 
    considered the last day of the period.
    
    
    Sec. 17.9   Protective orders.
    
        (a) The Office of Dispute Resolution for Acquisition may issue 
    protective orders addressing the treatment of protected information, 
    either at the request of a party or upon its own initiative. Such 
    information may include proprietary, confidential, or source-selection-
    sensitive material, or other information the release of which could 
    result in a competitive advantage to one or more firms.
        (b) The terms of the Office of Dispute Resolution for Acquisition's 
    standard protective order may be altered to suit particular 
    circumstances, by negotiation of the parties, subject to the approval 
    of the Office of Dispute Resolution for Acquisition. The protective 
    order establishes procedures for application for access to protected 
    information, identification and safeguarding of that information, and 
    submission of redacted copies of documents omitting protected 
    information.
        (c) After a protective order has been issued, counsel or 
    consultants retained by counsel appearing on behalf of a party may 
    apply for access to the material under the order by submitting an 
    application to the Office of Dispute Resolution for Acquisition, with 
    copies furnished simultaneously to all parties. The application shall 
    establish that the applicant is not involved in competitive 
    decisionmaking for any firm that could gain a competitive advantage 
    from access to the protected information and that the applicant will 
    diligently protect any protected information received from inadvertent 
    disclosure. Objections to an applicant's admission shall be raised 
    within two (2) days of the application, although the Office of Dispute 
    Resolution for Acquisition may consider objections raised after that 
    time for good cause.
        (d) Any violation of the terms of a protective order may result in 
    the imposition of sanctions or the taking of the actions as the Office 
    of Dispute Resolution for Acquisition deems appropriate.
        (e) The parties are permitted to agree upon what material is to be 
    covered by a protective order, subject to approval by the Office of 
    Dispute Resolution for Acquisition.
    
    Subpart B--Protests
    
    
    Sec. 17.11  Matters not subject to protest.
    
        The following matters may not be protested before the Office of 
    Dispute Resolution for Acquisition:
        (a) FAA purchases from or through, state, local, and tribal 
    governments and public authorities;
        (b) FAA purchases from or through other federal agencies;
        (c) Grants;
        (d) Cooperative agreements;
        (e) Other transactions which do not fall into the category of 
    procurement contracts subject to the AMS.
    
    
    Sec. 17.13  Dispute resolution process for protests.
    
        (a) Protests concerning FAA SIRs or contract awards shall be 
    resolved pursuant to this part.
        (b) The offeror initially should attempt to resolve any issues 
    concerning potential protests with the CO. The CO, in coordination with 
    FAA legal counsel, will make reasonable efforts to answer questions 
    promptly and completely, and, where possible, to resolve concerns or 
    controversies.
        (c) Offerors or prospective offerors shall file a protest with the 
    Office of Dispute Resolution for Acquisition in accordance with 
    Sec. 17.15. The protest time limitations set forth in Sec. 17.15 will 
    not be extended by attempts to resolve a potential protest with the CO. 
    Other than the time limitations specified in Sec. 17.15 for the filing 
    of protests, the Office of Dispute Resolution for Acquisition retains 
    the discretion to modify any time constraints imposed in connection 
    with protests.
        (d) In accordance with Sec. 17.17, the Office of Dispute Resolution 
    for Acquisition shall convene a status conference for the protest. 
    Under the procedures set forth in that section, the parties generally 
    will either decide to utilize Alternative Dispute Resolution (ADR) 
    techniques to resolve the protest, pursuant to subpart D of this part, 
    or they will proceed under the Default Adjudicative Process set forth 
    in subpart E of this part. However, as provided in Sec. 17.31(c), 
    informal ADR techniques may be utilized simultaneously with ongoing 
    adjudication.
        (e) The Office of Dispute Resolution for Acquisition Director shall 
    designate Dispute Resolution Officers (DROs) or Special Masters for 
    protests.
        (f) Multiple protests concerning the same SIR, solicitation, or 
    contract award may be consolidated at the discretion of the Office of 
    Dispute Resolution for Acquisition, and assigned to a single DRO or 
    Special Master for adjudication.
        (g) Procurement activities, and, where applicable, contractor 
    performance pending resolution of a protest shall continue during the 
    pendency of a protest, unless there is a compelling reason to suspend 
    or delay all or part of the procurement activities. Pursuant to 
    Secs. 17.15(d) and 17.17(b), the Office of Dispute Resolution for 
    Acquisition may recommend suspension of award or delay of contract 
    performance, in whole or in part, for a compelling reason. A decision 
    to suspend or delay procurement activities or contractor performance 
    would be made in writing by the FAA Administrator or the 
    Administrator's delegee.
    
    
    Sec. 17.15  Filing a protest.
    
        (a) Only an interested party may file a protest, and shall initiate 
    a protest by filing a written protest with the Office of Dispute 
    Resolution for Acquisition
    
    [[Page 32939]]
    
    within the times set forth below, or the protest shall be dismissed as 
    untimely:
        (1) Protests based upon alleged improprieties in a solicitation or 
    a SIR that are apparent prior to bid opening or the time set for 
    receipt of initial proposals shall be filed prior to bid opening or the 
    time set for the receipt of initial proposals.
        (2) In procurements where proposals are requested, alleged 
    improprieties that do not exist in the initial solicitation, but which 
    are subsequently incorporated into the solicitation, must be protested 
    not later than the next closing time for receipt of proposals following 
    the incorporation;
        (3) For protests other than those related to alleged solicitation 
    improprieties, the protest must be filed on the later of the following 
    two dates:
        (i) Not later than seven (7) business days after the date the 
    protester knew or should have known of the grounds for the protest; or
        (ii) If the protester has requested a post-award debriefing from 
    the FAA Product Team, not later than five (5) business days after the 
    date on which the Product Team holds that debriefing.
        (b) Protest shall be filed at:
    
    (1) Office of Dispute Resolution for Acquisition, AGC-70, Federal 
    Aviation Administration, 400 7th Street, SW, Room 8332, Washington, DC 
    20590, Telephone: (202) 366-6400, Facsimile: (202) 366-7400;
    or
    
    (2) Other address as shall be published from time to time in the 
    Federal Register.
    
        (c) A Protest shall be in writing, and set forth:
        (1) The protester's name, address, telephone number, and facsimile 
    (FAX) number;
        (2) The name, address, telephone number, and FAX number of a person 
    designated by the protester (Protester Designee), and who shall be duly 
    authorized to represent the protester, to be the point of contact;
        (3) The SIR number or, if available, the contract number and the 
    name of the CO;
        (4) The basis for the protester's status as an interested party;
        (5) The facts supporting the timeliness of the protest;
        (6) Whether the protester requests a protective order, the material 
    to be protected, and attach a redacted copy of that material;
        (7) A detailed statement of both the legal and factual grounds of 
    the protest, and attach one (1) copy of each relevant document;
        (8) The remedy or remedies sought by the protester, as set forth in 
    Sec. 17.21;
        (9) The signature of the Protester Designee, or another person duly 
    authorized to represent the protester.
        (d) If the protester wishes to request a suspension or delay of the 
    procurement, in whole or in part, and believes there are compelling 
    reasons that, if known to the FAA, would cause the FAA to suspend or 
    delay the procurement because of the protested action, the protester 
    shall:
        (1) Set forth each such compelling reason, supply all facts 
    supporting the protester's position, identify each person with 
    knowledge of the facts supporting each compelling reason, and identify 
    all documents that support each compelling reason.
        (2) Clearly identify any adverse consequences to the protester, the 
    FAA, or any interested party, should the FAA not suspend or delay the 
    procurement.
        (e) At the same time as filing the protest with the Office of 
    Dispute Resolution for Acquisition, the protester shall serve a copy of 
    the protest on the CO and any other official designated in the SIR for 
    receipt of protests by means reasonably calculated to be received by 
    the CO on the same day as it is to be received by the Office of Dispute 
    Resolution for Acquisition. The protest shall include a signed 
    statement from the protester, certifying to the Office of Dispute 
    Resolution for Acquisition the manner of service, date, and time when a 
    copy of the protest was served on the CO and other designated 
    official(s).
        (f) Upon receipt of the protest, the CO shall inform the Office of 
    Dispute Resolution for Acquisition of the names, addresses, and 
    telephone and facsimile numbers of the awardee and/or other interested 
    parties, if known, and shall, in such notice, designate a person as the 
    point of contact for the Office of Dispute Resolution for Acquisition 
    by facsimile. The CO shall also notify the awardee and/or interested 
    parties in writing of the existence of the protest the same day as the 
    CO provides the foregoing information to the Office of Dispute 
    Resolution for Acquisition.
        (g) The Office of Dispute Resolution for Acquisition has discretion 
    to designate the parties who shall participate in the protest as 
    intervenors. For awarded contracts, only the awardee may participate as 
    an intervenor.
    
    
    Sec. 17.17  Initial protest procedures.
    
        (a) If, as part of a protest, the protester requests a suspension 
    or delay of procurement, in whole or in part, pursuant to 
    Sec. 17.15(d), the Product Team shall submit a response to the request 
    to the Office of Dispute Resolution for Acquisition within two (2) 
    business days of receipt of the protest. Copies of the response shall 
    be furnished to the protester and any intervenor(s) so as to be 
    received within the same two (2) business days. The protester and any 
    intervenor(s) shall have the opportunity of providing additional 
    comments on the response within an additional period of two (2) 
    business days. Based on its review of such submissions, the Office of 
    Dispute Resolution for Acquisition, in its discretion, may recommend 
    such suspension or delay to the Administrator or the Administrator's 
    designee.
        (b) Within five (5) business days of the filing of a protest, or as 
    soon thereafter as practicable, the Office of Dispute Resolution for 
    Acquisition shall convene a status conference to--
        (1) Review procedures;
        (2) Identify and develop issues related to summary dismissal and 
    suspension recommendations;
        (3) Handle issues related to protected information and the issuance 
    of any needed protective order;
        (4) Encourage the parties to use ADR;
        (5) Conduct or arrange for early neutral evaluation of the protest 
    by a DRO or Neutral or Compensated Neutral, at the discretion of the 
    Office of Dispute Resolution for Acquisition and/or based upon the 
    agreement or request of any party(ies) seeking such evaluation; and
        (6) For any other reason deemed appropriate by the DRO or by the 
    Office of Dispute Resolution for Acquisition.
        (c) On the fifth business day following the status conference, the 
    Product Team and protester will file with the Office of Dispute 
    Resolution for Acquisition--
        (1) A joint statement that they have decided to pursue ADR 
    proceedings in lieu of adjudication in order to resolve the protest; or
        (2) Joint or separate written explanations as to why ADR 
    proceedings will not be used and why the Default Adjudicative Process 
    will be needed..
        (d) Should the Product Team and protester elect to utilize ADR 
    proceedings to resolve the protest, they will agree upon the neutral to 
    conduct the ADR proceedings (either an Office of Dispute Resolution for 
    Acquisition-designated Neutral or a Compensated Neutral of their own 
    choosing) pursuant to Sec. 17.33(c), and shall execute and file with 
    the Office of Dispute Resolution for Acquisition a written ADR 
    agreement within five (5) business days after the status conference. 
    Agreement of any intervenor(s) to the use of ADR or the resolution of a 
    dispute through ADR shall not be required.
    
    [[Page 32940]]
    
        (e) Should the Product Team or protester indicate at the status 
    conference that ADR proceedings will not be used, then within ten (10) 
    business days following the status conference, the Product Team will 
    file with the Office of Dispute Resolution for Acquisition a Product 
    Team Response to the protest. The Office of Dispute Resolution for 
    Acquisition may alter the schedule for filing of the Product Team 
    Response to accommodate the requirements of a particular protest.
        (f) The Product Team Response shall consist of a written 
    chronological statement of pertinent facts, and a written presentation 
    of applicable legal or other defenses. The Product Team Response shall 
    cite to and be accompanied by all relevant documents, which shall be 
    chronologically indexed and tabbed. A copy of the response shall be 
    furnished so as to be received by the protester and any intervenor(s) 
    on the same date it is filed with the Office of Dispute Resolution for 
    Acquisition, if practicable, but in any event no later than one (1) 
    business day after the date if it is filed with the Office of Dispute 
    Resolution for Acquisition. In all cases, the Product Team shall 
    indicate the method of service used.
        (g) Should the parties pursue ADR proceedings under subpart D of 
    this part and fail to achieve a complete resolution of the protest via 
    ADR, the Office of Dispute Resolution for Acquisition, upon 
    notification of that fact by any of the parties, shall designate a DRO 
    or Special Master for purposes of adjudication under subpart E of this 
    part, and the DRO or Special Master shall convene a status conference, 
    wherein he/she shall establish a schedule for the filing of the Product 
    Team Response and further submissions.
        (h) Upon submission of the Product Team Response, the protest will 
    proceed under the Default Adjudicative Process pursuant to Sec. 17.37.
        (i) The time limitations of this section maybe extended by the 
    Office of Dispute Resolution for Acquisition for good cause.
    
    
    Sec. 17.19   Dismissal or summary decision of protests.
    
        (a) At any time during the protest, any party may request, by 
    motion to the Office of Dispute Resolution for Acquisition, that--
        (1) The protest, or any count or portion of a protest, be dismissed 
    for lack of jurisdiction, if the protester fails to establish that the 
    protest is timely, or that the protester has no standing to pursue the 
    protest;
        (2) The protest, or any count or portion of a protest, be 
    dismissed, if frivolous or without basis in fact or law, or for failure 
    to state a claim upon which relief may be had;
        (3) A summary decision be issued with respect to the protest, or 
    any count or portion of a protest, if:
        (i) The undisputed material facts demonstrate a rational basis for 
    the Product Team action or inaction in question, and there are no other 
    material facts in dispute that would overcome a finding of such a 
    rational basis; or
        (ii) The undisputed material facts demonstrate, that no rational 
    basis exists for the Product Team action or inaction in question, and 
    there are no material facts in dispute that would overcome a finding of 
    the lack of such a rational basis.
        (b) In connection with any request for dismissal or summary 
    decision, the Office of Dispute Resolution for Acquisition shall 
    consider any material facts in dispute, in a light most favorable to 
    the party against whom the request is made.
        (c) Either upon motion by a party or on its own initiative, the 
    Office of Dispute Resolution for Acquisition may, at any time, exercise 
    its discretion to:
        (1) Recommend to the Administrator dismissal or the issuance of a 
    summary decision with respect to the entire protest;
        (2) Dismiss the entire protest or issue a summary decision with 
    respect to the entire protest, if delegated that authority by the 
    Administrator; or
        (3) Dismiss or issue a summary decision with respect to any count 
    or portion of a protest.
        (d) A dismissal or summary decision regarding the entire protest by 
    either the Administrator, or the Office of Dispute Resolution for 
    Acquisition by delegation, shall be construed as a final agency order. 
    A dismissal or summary decision that does not resolve all counts or 
    portions of a protest shall not constitute a final agency order, unless 
    and until such dismissal or decision is incorporated or otherwise 
    adopted in a decision by the Administrator (or the Office of Dispute 
    Resolution for Acquisition, by delegation) regarding the entire 
    protest.
        (e) Prior to recommending or entering either a dismissal or a 
    summary decision, either in whole or in part, the Office of Dispute 
    Resolution for Acquisition shall afford all parties against whom the 
    dismissal or summary decision is to be entered the opportunity to 
    respond to the proposed dismissal or summary decision.
    
    
    Sec. 17.21  Protest remedies.
    
        (a) The Office of Dispute Resolution for Acquisition has broad 
    discretion to recommend remedies for a successful protest that are 
    consistent with the AMS and applicable statutes. Such remedies may 
    include, but are not limited to one or more, or a combination of, the 
    following--
        (1) Amend the SIR;
        (2) Refrain from exercising options under the contract;
        (3) Issue a new SIR;
        (4) Require recompetition;
        (5) Terminate an existing contract for the FAA's convenience;
        (6) Direct an award to the protester;
        (7) Award bid and proposal costs; or
        (8) Any combination of the above remedies, or any other action 
    consistent with the AMS that is appropriate under the circumstances.
        (b) In determining the appropriate recommendation, the Office of 
    Dispute Resolution for Acquisition should consider the circumstances 
    surrounding the procurement or proposed procurement including, but not 
    limited to: the nature of the procurement deficiency; the degree of 
    prejudice to other parties or to the integrity of the acquisition 
    system; the good faith of the parties; the extent of performance 
    completed; the cost of any proposed remedy to the FAA; the urgency of 
    the procurement; and the impact of the recommendation on the FAA.
        (c) Attorney's fees of a prevailing protester are allowable to the 
    extent permitted by the Equal Access to Justice Act, 5 U.S.C. 
    504(a)(1)(EAJA).
    
    Subpart C--Contract Disputes
    
    
    Sec. 17.23  Dispute resolution process for contract disputes.
    
        (a) All contract disputes arising under contracts subject to the 
    AMS shall be resolved under this subpart.
        (b) Contractors shall file contract disputes with the Office of 
    Dispute Resolution for Acquisition and the CO pursuant to Sec. 17.25.
        (c) After filing the contract dispute, the contractor should seek 
    informal resolution with the CO:
        (1) The CO, with the advice of FAA legal counsel, has full 
    discretion to settle contract disputes, except where the matter 
    involves fraud;
        (2) The parties shall have up to twenty (20) business days within 
    which to resolve the dispute informally, and may contact the Office of 
    Dispute Resolution for Acquisition for assistance in facilitating such 
    a resolution; and
        (3) If no informal resolution is achieved during the twenty (20)
    
    [[Page 32941]]
    
    business day period, the parties shall file joint or separate 
    statements with the Office of Dispute Resolution for Acquisition 
    pursuant to Sec. 17.27.
        (d) If informal resolution of the contract dispute appears 
    probable, the Office of Dispute Resolution for Acquisition shall extend 
    the time for the filing of the joint statement under Sec. 17.27 for up 
    to an additional twenty (20) business days, upon joint request of the 
    CO and contractor.
        (e) The Office of Dispute Resolution for Acquisition shall hold a 
    status conference with the parties within ten (10) business days after 
    receipt of the joint statement required by Sec. 17.27, or as soon 
    thereafter as is practicable, in order to establish the procedures to 
    be utilized to resolve the contract dispute.
        (f) The Office of Dispute Resolution for Acquisition has broad 
    discretion to recommend remedies for a successful contract dispute, 
    that are consistent with the AMS and applicable law.
    
    
    Sec. 17.25  Filing a contract dispute.
    
        (a) Contract disputes are to be in writing and shall contain:
        (1) The contractor's name, address, telephone and fax numbers and 
    the name, address, telephone and fax numbers of the contractor's legal 
    representative(s) (if any) for the contract dispute;
        (2) The contract number and the name of the Contracting Officer;
        (3) A detailed chronological statement of the facts and of the 
    legal grounds for the contractor's positions regarding each element or 
    count of the contract dispute (i.e., broken down by individual claim 
    item), citing to relevant contract provisions and documents and 
    attaching copies of those provisions and documents;
        (4) All information establishing that the contract dispute was 
    timely filed;
        (5) A request for a specific remedy, and if a monetary remedy is 
    requested, a sum certain must be specified and pertinent cost 
    information and documentation (e.g., invoices and cancelled checks) 
    attached, broken down by individual claim item and summarized; and
        (6) The signature of a duly authorized representative of the 
    initiating party.
        (b) Contract disputes shall be filed by mail, in person, by 
    overnight delivery or by facsimile at the following address:
    
    (1) Office of Dispute Resolution for Acquisition, AGC-70, Federal 
    Aviation Administration, 400 7th Street, SW, Room 8332, Washington, DC 
    20590, Telephone: (202) 366-6400, Facsimile: (202) 366-7400;
        or
    (2) Other address as shall be published from time to time in the 
    Federal Register.
    
        (c) A contract dispute against the FAA shall be filed with the 
    Office of Dispute Resolution for Acquisition within two (2) years of 
    the accrual of the contract claim involved. A contract dispute by the 
    FAA against a contractor (excluding contract disputes alleging warranty 
    issues, fraud or latent defects) likewise shall be filed within two (2) 
    years after the accrual of the contract claim. If an underlying 
    contract entered into prior to the effective date of this part provides 
    for time limitations for filing of contract disputes with The Office of 
    Dispute Resolution for Acquisition which differ from the aforesaid two 
    (2) year period, the limitation periods in the contract shall control 
    over the limitation period of this section. In no event will either 
    party be permitted to file with the Office of Dispute Resolution for 
    Acquisition a contract dispute seeking an equitable adjustment or other 
    damages after the contractor has accepted final contract payment, with 
    the exception of FAA claims related to warranty issues, gross mistakes 
    amounting to fraud or latent defects. FAA claims against the contractor 
    based on warranty issues must be filed within the time specified under 
    applicable contract warranty provisions. Any FAA claims against the 
    contractor based on gross mistakes amounting to fraud or latent defects 
    shall be filed with the Office of Dispute Resolution for Acquisition 
    within two (2) years of the date on which the FAA knew or should have 
    known of the presence of the fraud or latent defect.
        (d) A party shall serve a copy of the contract dispute upon the 
    other party, by means reasonably calculated to be received on the same 
    day as the filing is to be received by the Office of Dispute Resolution 
    for Acquisition.
    
    
    Sec. 17.27  Submission of joint or separate statements.
    
        (a) If the matter has not been resolved informally, the parties 
    shall file joint or separate statements with the Office of Dispute 
    Resolution for Acquisition no later than twenty (20) business days 
    after the filing of the contract dispute. The Office of Dispute 
    Resolution for Acquisition may extend this time, pursuant to 
    Sec. 17.23(d).
        (b) The statement(s) shall include either--
        (1) A joint request for ADR, and an executed ADR agreement, 
    pursuant to Sec. 17.33(d), specifying which ADR techniques will be 
    employed; or
        (2) Written explanation(s) as to why ADR proceedings will not be 
    used and why the Default Adjudicative Process will be needed.
        (c) Such statements shall be directed to the following address:
    
    (1) Office of Dispute Resolution for Acquisition, AGC-70, Federal 
    Aviation Administration, 400 7th Street, SW., Room 8332, Washington, DC 
    20590, Telephone: (202) 366-6400, Facsimile: (202) 366-7400;
        or
    (2) Other address as shall be published from time to time in the 
    Federal Register.
    
        (d) The submission of a statement which indicates that ADR will not 
    be utilized will not in any way preclude the parties from engaging in 
    informal ADR techniques with the Office of Dispute Resolution for 
    Acquisition (neutral evaluation and/or informal mediation) concurrently 
    with ongoing adjudication under the Default Adjudicative Process, 
    pursuant to Sec. 17.31(c).
    
    
    Sec. 17.29  Dismissal or summary decision of contract disputes.
    
        (a) Any party may request, by motion to the Office of Dispute 
    Resolution for Acquisition, that a contract dispute be dismissed, or 
    that a count or portion of a contract dispute be stricken, if:
        (1) It was not timely filed with the Office of Dispute Resolution 
    for Acquisition;
        (2) It was filed by a subcontractor;
        (3) It fails to state a matter upon which relief may be had; or
        (4) It involves a matter not subject to the jurisdiction of the 
    Office of Dispute Resolution for Acquisition.
        (b) In connection with any request for dismissal of a contract 
    dispute, or to strike a count or portion thereof, the Office of Dispute 
    Resolution for Acquisition should consider any material facts in 
    dispute in a light most favorable to the party against whom the request 
    for dismissal is made.
        (c) At any time, whether pursuant to a motion or request or on its 
    own initiative and at its discretion, the Office of Dispute Resolution 
    for Acquisition may--
        (1) Dismiss or strike a count or portion of a contract dispute;
        (2) Recommend to the Administrator that the entire contract dispute 
    be dismissed; or
        (3) With delegation from the Administrator, dismiss the entire 
    contract dispute.
        (d) An order of dismissal of the entire contract dispute, issued 
    either by the Administrator or by the Office of Dispute Resolution for 
    Acquisition where delegation exists, on the grounds set forth in this 
    section, shall constitute
    
    [[Page 32942]]
    
    a final agency order. An Office of Dispute Resolution for Acquisition 
    order dismissing or striking a count or portion of a contract dispute 
    shall not constitute a final agency order, unless and until such Office 
    of Dispute Resolution for Acquisition order is incorporated or 
    otherwise adopted in a decision of the Administrator or the 
    Administrator's delegee.
        (e) Prior to recommending or entering either a dismissal or a 
    summary decision, either in whole or in part, the Office of Dispute 
    Resolution for Acquisition shall afford all parties against whom the 
    dismissal or summary decision is to be entered the opportunity to 
    respond to a proposed dismissal or summary decision.
    
    Subpart D--Alternative Dispute Resolution
    
    
    Sec. 17.31  Use of alternative dispute resolution.
    
        (a) The Office of Dispute Resolution for Acquisition shall 
    encourage the parties to utilize ADR as their primary means to resolve 
    protests and contract disputes.
        (b) The parties shall make a good faith effort to explore ADR 
    possibilities in all cases and to employ ADR in every appropriate case. 
    The Office of Dispute Resolution for Acquisition will encourage use of 
    ADR techniques such as mediation, neutral evaluation, or minitrials, or 
    variations of these techniques as agreed by the parties and approved by 
    the Office of Dispute Resolution for Acquisition. The Office of Dispute 
    Resolution for Acquisition shall assign a DRO to explore ADR options 
    with the parties and to arrange for an early neutral evaluation of the 
    merits of a case, if requested by any party.
        (c) The Default Adjudicative Process will be used where the parties 
    cannot achieve agreement on the use of ADR; or where ADR has been 
    employed but has not resolved all pending issues in dispute; or where 
    the Office of Dispute Resolution for Acquisition concludes that ADR 
    will not provide an expeditious means of resolving a particular 
    dispute. Even where the Default Adjudicative Process is to be used, the 
    Office of Dispute Resolution for Acquisition, with the parties consent, 
    may employ informal ADR techniques concurrently with and in parallel to 
    adjudication.
    
    
    Sec. 17.33  Election of alternative dispute resolution process.
    
        (a) The Office of Dispute Resolution for Acquisition will make its 
    personnel available to serve as Neutrals in ADR proceedings and, upon 
    request by the parties, will attempt to make qualified non-FAA 
    personnel available to serve as Neutrals through neutral-sharing 
    programs and other similar arrangements. The parties may elect to 
    employ a mutually Compensated Neutral, if the parties agree as to how 
    the costs of any such Compensated Neutral are to be shared.
        (b) The parties using an ADR process to resolve a protest shall 
    submit an executed ADR agreement containing the information outlined in 
    paragraph (d) of this section to the Office of Dispute Resolution for 
    Acquisition within five (5) business days after the Office of Dispute 
    Resolution for Acquisition conducts a status conference pursuant to 
    Sec. 17.17(c). The Office of Dispute Resolution for Acquisition may 
    extend this time for good cause.
        (c) The parties using an ADR process to resolve a contract dispute 
    shall submit an executed ADR agreement containing the information 
    outlined in paragraph (d) of this section to the Office of Dispute 
    Resolution for Acquisition as part of the joint statement specified 
    under Sec. 17.27.
        (d) The parties to a protest or contract dispute who elect to use 
    ADR must submit to the Office of Dispute Resolution for Acquisition an 
    ADR agreement setting forth:
        (1) The type of ADR technique(s) to be used;
        (2) The agreed-upon manner of using the ADR process; and
        (3) Whether the parties agree to use a Neutral through The Office 
    of Dispute Resolution for Acquisition or to use a Compensated Neutral 
    of their choosing, and, if a Compensated Neutral is to be used, how the 
    cost of the Compensated Neutral's services will be shared.
        (e) Non-binding ADR techniques are not mutually exclusive, and may 
    be used in combination if the parties agree that a combination is most 
    appropriate to the dispute. The techniques to be employed must be 
    determined in advance by the parties and shall be expressly described 
    in their ADR agreement. The agreement may provide for the use of any 
    fair and reasonable ADR technique that is designed to achieve a prompt 
    resolution of the matter. An ADR agreement for non-binding ADR shall 
    provide for a termination of ADR proceedings and the commencement of 
    adjudication under the Default Adjudicative Process, upon the election 
    of any party. Notwithstanding such termination, the parties may still 
    engage with the Office of Dispute Resolution for Acquisition in 
    informal ADR techniques (neutral evaluation and/or informal mediation) 
    concurrently with adjudication, pursuant to Sec. 17.31(c).
        (f) Binding arbitration may be permitted by the Office of Dispute 
    Resolution for Acquisition on a case-by-case basis; and shall be 
    subject to the provisions of 5 U.S.C. 575(a), (b), and (c), and any 
    other applicable law. Arbitration that is binding on the parties, 
    subject to the Administrator's right to approve or disapprove the 
    arbitrator's decision, may also be permitted.
        (g) For protests, the ADR process shall be completed within twenty 
    (20) business days from the filing of an executed ADR agreement with 
    the Office of Dispute Resolution for Acquisition unless the parties 
    request, and are granted an extension of time from the Office of 
    Dispute Resolution for Acquisition.
        (h) For contract disputes, the ADR process shall be completed 
    within forty (40) business days from the filing of an executed ADR 
    agreement with the Office of Dispute Resolution for Acquisition, unless 
    the parties request, and are granted an extension of time from the 
    Office of Dispute Resolution for Acquisition.
        (i) The parties shall submit to the Office of Dispute Resolution 
    for Acquisition an agreed-upon protective order, if necessary, in 
    accordance with the requirements of Sec. 17.9.
    
    
    Sec. 17.35  Selection of neutrals for the alternative dispute 
    resolution process.
    
        (a) In connection with the ADR process, the parties may select a 
    Compensated Neutral acceptable to both, or may request the Office of 
    Dispute Resolution for Acquisition to provide the services of a DRO or 
    other Neutral.
        (b) In cases where the parties select a Compensated Neutral who is 
    not familiar with Office of Dispute Resolution for Acquisition 
    procedural matters, the parties or Compensated Neutral may request the 
    Office of Dispute Resolution for Acquisition for the services of a DRO 
    to advise on such matters.
    
    Subpart E--Default Adjudicative Process
    
    
    Sec. 17.37  Default adjudicative process for protests.
    
        (a) Other than for the resolution of preliminary or dispositive 
    matters, the Default Adjudicative Process for protests will commence 
    upon the submission of the Product Team Response to the Office of 
    Dispute Resolution for Acquisition, pursuant to Sec. 17.17.
    
    [[Page 32943]]
    
        (b) The Director of the Office of Dispute Resolution for 
    Acquisition shall select a DRO or a Special Master to conduct fact-
    finding proceedings and to provide findings and recommendations 
    concerning some or all of the matters in controversy.
        (c) The DRO or Special Master may prepare procedural orders for the 
    proceedings as deemed appropriate; and may require additional 
    submissions from the parties. As a minimum, the protester and any 
    intervenor(s) must submit to the Office of Dispute Resolution for 
    Acquisition written comments with respect to the Product Team Response 
    within five (5) business days of the Response having been filed with 
    the Office of Dispute Resolution for Acquisition or within five (5) 
    business days of their receipt of the Response, whichever is later. 
    Copies of such comments shall be provided to the other participating 
    parties by the same means and on the same date as they are furnished to 
    the Office of Dispute Resolution for Acquisition.
        (d) The DRO or Special Master may convene the parties and/or their 
    representatives, as needed, to pursue the Default Adjudicative Process.
        (e) If, in the sole judgment of the DRO or Special Master, the 
    parties have presented written material sufficient to allow the protest 
    to be decided on the record presented, the DRO or Special Master shall 
    have the discretion to decide the protest on that basis.
        (f) The parties may engage in voluntary discovery with one another 
    and, if justified, with non-parties, so as to obtain information 
    relevant to the allegations of the protest. The DRO or Special Master 
    may also direct the parties to exchange, in an expedited manner, 
    relevant, non-privileged documents. Where justified, the DRO or Special 
    Master may direct the taking of deposition testimony, however, the FAA 
    dispute resolution process does not contemplate extensive discovery. 
    The DRO or Special Master shall manage the discovery process, including 
    limiting its length and availability, and shall establish schedules and 
    deadlines for discovery, which are consistent with time frames 
    established in this part and with the FAA policy of providing fair and 
    expeditious dispute resolution.
        (g) The DRO or Special Master may conduct hearings, and may limit 
    the hearings to the testimony of specific witnesses and/or 
    presentations regarding specific issues. The DRO or Special Master 
    shall control the nature and conduct of all hearings, including the 
    sequence and extent of any testimony. Hearings will be conducted:
        (1) Where the DRO or Special Master determines that there are 
    complex factual issues in dispute that cannot adequately or efficiently 
    be developed solely by means of written presentations and/or that 
    resolution of the controversy will be dependent on his/her assessment 
    of the credibility of statements provided by individuals with first-
    hand knowledge of the facts; or
        (2) Upon request of any party to the protest, unless the DRO or 
    Special Master finds specifically that a hearing is unnecessary and 
    that no party will be prejudiced by limiting the record in the 
    adjudication to the parties' written submissions. All witnesses at any 
    such hearing shall be subject to cross-examination by the opposing 
    party and to questioning by the DRO or Special Master.
        (h) The Director of the Office of Dispute Resolution for 
    Acquisition may review the status of any protest in the Default 
    Adjudicative Process with the DRO or Special Master during the pendency 
    of the process.
        (i) Within thirty (30) business days of the commencement of the 
    Default Adjudicative Process, or at the discretion of the Office of 
    Dispute Resolution for Acquisition, the DRO or Special Master will 
    submit findings and recommendations to the Office of Dispute Resolution 
    for Acquisition that shall contain the following:
        (1) Findings of fact;
        (2) Application of the principles of the AMS, and any applicable 
    law or authority to the findings of fact;
        (3) A recommendation for a final FAA order; and
        (4) If appropriate, suggestions for future FAA action.
        (j) In arriving at findings and recommendations relating to 
    protests, the DRO or Special Master shall consider whether or not the 
    Product Team actions in question had a rational basis, and whether or 
    not the Product Team decision under question was arbitrary, capricious 
    or an abuse of discretion. Findings of fact underlying the 
    recommendations must be supported by substantial evidence.
        (k) The DRO or Special Master has broad discretion to recommend a 
    remedy that is consistent with Sec. 17.21.
        (l) A DRO or Special Master shall submit findings and 
    recommendations only to the Director of the Office of Dispute 
    Resolution for Acquisition. The findings and recommendations will be 
    released to the parties and to the public, only upon issuance of the 
    final FAA order in the case. Should an Office of Dispute Resolution for 
    Acquisition protective order be issued in connection with the protest, 
    a redacted version of the findings and recommendations, omitting any 
    protected information, shall be prepared wherever possible and released 
    to the public along with a copy of the final FAA order. Only persons 
    admitted by the Office of Dispute Resolution for Acquisition under the 
    protective order and Government personnel shall be provided copies of 
    the unredacted findings and recommendations.
        (m) The time limitations set forth in this section may be extended 
    by the Office of Dispute Resolution for Acquisition for good cause.
    
    
    Sec. 17.39  Default adjudicative process for contract disputes.
    
        (a) The Default Adjudicative Process for contract disputes will 
    commence on the latter of:
        (1) The parties' submission to the Office of Dispute Resolution for 
    Acquisition of a joint statement pursuant to Sec. 17.27 which indicates 
    that ADR will not be utilized; or
        (2) The parties' submission to the Office of Dispute Resolution for 
    Acquisition of notification by any party that the parties have not 
    settled some or all of the dispute issues via ADR, and it is unlikely 
    that they can do so within the time period allotted and/or any 
    reasonable extension.
        (b) Within twenty (2) business days of the commencement of the 
    Default Adjudicative Process, the Product Team shall prepare and submit 
    to the Office of Dispute Resolution for Acquisition, with a copy to the 
    contractor, a chronologically arranged and indexed Dispute File, 
    containing all documents which are relevant to the facts and issues in 
    dispute. The contractor will be entitled to supplement such a Dispute 
    File with additional documents.
        (c) The Director of the Office of Dispute Resolution for 
    Acquisition shall assign a DRO or a Special Master to conduct fact-
    finding proceedings and provide findings and recommendations concerning 
    the issues in dispute.
        (d) The Director of the Office of Dispute Resolution for 
    Acquisition may delegate authority to the DRO or Special Master to 
    conduct a Status Conference within ten (10) business days of the 
    commencement of the Default Adjudicative Process, and, may further 
    delegate to the DRO or Special Master the authority to issue such 
    orders or decisions to promote the efficient resolution of the contract 
    dispute.
        (e) At any such Status Conference, or as necessary during the 
    Default Adjudicative Process, the DRO or Special Master will:
    
    [[Page 32944]]
    
        (1) Determine the appropriate amount of discovery required to 
    resolve the dispute;
        (2) Review the need for a protective order, and if one is needed, 
    prepare a protective order pursuant to Sec. 17.9;
        (3) Determine whether any issue can be stricken; and
        (4) Prepare necessary procedural orders for the proceedings.
        (f) At a time or at times determined by the DRO or Special Master, 
    and in advance of the decision of the case, the parties shall make 
    final submissions to the Office of Dispute Resolution for Acquisition 
    and to the DRO or Special Master, which submissions shall include the 
    following:
        (1) A joint statement of the issues;
        (2) A joint statement of undisputed facts related to each issue;
        (3) Separate statements of disputed facts related to each issue, 
    with appropriate citations to documents in the Dispute File, to pages 
    of transcripts of any hearing or deposition, or to any affidavit or 
    exhibit which a party may wish to submit with its statement;
        (4) Separate legal analyses in support of the parties' respective 
    positions on disputed issues.
        (g) Each party shall serve a copy of its final submission on the 
    other party by means reasonable calculated so that the other party 
    receives such submissions on the same day it is received by the Office 
    of Dispute Resolution for Acquisition.
        (h) The DRO or Special Master may decide the contract dispute on 
    the basis of the record and the submissions referenced in this section, 
    or may, in the DRO or Special Master's discretion, allow the parties to 
    make additional presentations in writing. The DRO or Special Master may 
    conduct hearings, and may limit the hearings to the testimony of 
    specific witnesses and/or presentations regarding specific issues. The 
    DRO or Special Master shall control the nature and conduct of all 
    hearings, including the sequence and extent of any testimony. Hearings 
    on the record shall be conducted by the ODRA:
        (1) Where the DRO or Special Master determines that there are 
    complex factual issues in dispute that cannot adequately or efficiently 
    be developed solely by means of written presentations and/or that 
    resolution of the controversy will be dependent on his/her assessment 
    of the credibility of statements provided by individuals with first-
    hand knowledge of the facts; or
        (2) Upon request of any party to the contract dispute, unless the 
    DRO or Special Master finds specifically that a hearing is unnecessary 
    and that no party will be prejudiced by limiting the record in the 
    adjudication to the parties written submissions. All witnesses at any 
    such hearing shall be subject to cross-examination by the opposing 
    party and to questioning by the DRO or Special Master.
        (i) The DRO or Special Master shall prepare findings and 
    recommendations within thirty (30) business days from receipt of the 
    final submissions of the parties, unless that time is extended by the 
    Officer of Dispute Resolution for Acquisition for good cause. The 
    findings and recommendations shall contain findings of fact, 
    application of the principles of the AMS and other law or authority 
    applicable to the findings of fact, a recommendation for a final FAA 
    order, and, if appropriate, suggestions for future FAA action.
        (j) As a party of the findings and recommendations, the DRO or 
    Special Master shall review the disputed issue or issues in the context 
    of the contract, any applicable law and the AMS. Any finding of fact 
    set forth in the fundings and recommendation must be supported by 
    substantial evidence.
        (k) The Director of the Office of Dispute Resolution for 
    Acquisition may review the status of any contract dispute in the 
    Default Adjudicative Process with the DRO or Special Master during the 
    pendency of the process.
        (l) A DRO or Special Master shall submit findings and 
    recommendations only to the Director of the Office of Dispute 
    Resolution for Acquisition. The findings and recommendations will be 
    released to the parties and to the public, upon issuance of the final 
    FAA order in the case. Should an Office of Dispute Resolution for 
    Acquisition protective order be issued in connection with the contract 
    dispute, a redacted version of the findings and recommendations 
    omitting any protected information, shall be prepared wherever possible 
    and released to the public along with a copy of the final FAA order. 
    Only persons admitted by the Office of Dispute Resolution for 
    Acquisition under the protective order and Government personal shall be 
    provided copies of the unredacted findings and recommendation.
        (m) The time limitations set forth in this section may be extended 
    by the Office of Dispute Resolution for Acquisition for good cause.
    
    Subpart F--Finality and Review
    
    Sec. 17.41  Final orders.
    
        All final FAA orders regarding protests or connect disputes under 
    this part are to be issued by the FAA Administrator or by a delegee of 
    the Administrator.
    
    
    Sec. 17.43  Judicial review.
    
        (a) A protestor or contractor may seek of a final FAA order, 
    pursuant to 49 U.S.C. 46110, only after the administrative remedies of 
    this part have been exhausted.
        (b) A copy of the petition for review shall be filed with the 
    Office of Dispute Resolution for Acquisition and the FAA Chief Counsel 
    on the date that the petition for review is filed with the appropriate 
    circuit court of appeals.
    
    
    Sec. 17.45  Conforming amendments.
    
        The FAA shall amend pertinent provisions of the AMS, standard 
    contract forms and clauses, and any guidance to contracting officials, 
    so as to conform to the provisions of this part.
    
    Appendix A to Part 17--Alternative Dispute Resolution (ADR)
    
        A. The FAA dispute resolution procedures encourage the parties 
    to protests and contract disputes to use ADR as the primary means to 
    resolve protests and contract disputes, pursuant to the 
    Administrative Dispute Resolution Act of 1996, Pub. L. 104-320, 5 
    U.S.C. 570-579, and Department of Transportation and FAA policies to 
    utilize ADR to the maximum extent practicable. Under the procedures 
    presented in this part, the Office of Dispute Resolution for 
    Acquisition would encourage parties to consider ADR techniques such 
    as case evaluation, mediation, or arbitration.
        B. ADR encompasses a number of processes and techniques for 
    resolving protests or contract disputes. The most commonly used 
    types include:
        (1) Mediation. The Neutral or Compensated Neutral ascertains the 
    needs and interests of both parties and facilitates discussions 
    between or among the parties and an amicable resolution of their 
    differences, seeking approaches to bridge the gaps between the 
    parties' respective positions. The Neutral or Compensated Neutral 
    can meet with the parties separately, conduct joint meetings with 
    the parties' representatives, or employ both methods in appropriate 
    cases.
        (2) Neutral Evaluation. At any stage during the ADR process, as 
    the parties may agree, the Neutral or Compensated Neutral will 
    provide a candid assessment and opinion of the strengths and 
    weaknesses of the parties' positions as to the facts and law, so as 
    to facilitate further discussion and resolution.
        (3) Minitrial. The minitrial resembles adjudication, but is less 
    formal. It is used to provide an efficient process for airing and 
    resolving more complex, fact-intensive disputes. The parties select 
    principal representatives who should be senior officials of their 
    respective organizations, having authority to negotiate a complete 
    settlement. It is preferable that the principals be individuals who 
    were not directly involved in the events leading to the dispute and 
    who, thus, may be able to maintain a degree of impartiality during 
    the proceeding. In order to maintain such impartiality, the 
    principals typically serve as ``judges'' over the mini-trial 
    proceeding together with the
    
    [[Page 32945]]
    
    Neutral or Compensated Neutral. The proceeding is aimed at informing 
    the principal representatives and the Neutral or Compensated Neutral 
    of the underlying bases of the parties' positions. Each party is 
    given the opportunity and responsibility to present its position. 
    The presentations may be made through the parties' counsel and/or 
    through some limited testimony of fact witnesses or experts, which 
    may be subject to cross-examination or rebuttal. Normally, witnesses 
    are not sworn in and transcripts are not made of the proceedings. 
    Similarly, rules of evidence are not directly applicable, though it 
    is recommended that the Neutral or Compensated Neutral be provided 
    authority by the parties' ADR agreement to exclude evidence which is 
    not relevant to the issues in dispute, for the sake of an efficient 
    proceeding. Frequently, minitrials are followed either by direct 
    one-on-one negotiations by the parties' principals or by meetings 
    between the Neutral/Compensated Neutral and the parties' principals, 
    at which the Neutral/Compensated Neutral may offer his or her views 
    on the parties' positions (i.e., Neutral Evaluation) and/or 
    facilitate negotiations and ultimate resolution via Mediation.
    
        Issued in Washington, DC, on June 10, 1999.
    Jane F. Garvey,
    Administrator.
    [FR Doc. 99-15217 Filed 6-17-99; 8:45 am]
    BILLING CODE 4910-13-M
    
    
    

Document Information

Effective Date:
6/28/1999
Published:
06/18/1999
Department:
Federal Aviation Administration
Entry Type:
Rule
Action:
Final rule.
Document Number:
99-15217
Dates:
June 28, 1999.
Pages:
32926-32945 (20 pages)
Docket Numbers:
Docket No. FAA-1998-4379, Amendment No. 14-0317-01
RINs:
2120-AG19: Procedures for Protests and Contract Disputes; Amendment of Equal Access to Justice Act Regulations
RIN Links:
https://www.federalregister.gov/regulations/2120-AG19/procedures-for-protests-and-contract-disputes-amendment-of-equal-access-to-justice-act-regulations
PDF File:
99-15217.pdf
CFR: (37)
14 CFR 17.17(c)
14 CFR 17.15(d)
14 CFR 17.23(d)
14 CFR 14.02
14 CFR 14.03
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