96-18774. Acquisition Regulation; Department of Energy Management and Operating Contracts.

[Federal Register Volume 61, Number 144 (Thursday, July 25, 1996)]
[Proposed Rules]
[Pages 38701-38702]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18774]


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DEPARTMENT OF ENERGY

48 CFR Parts 917, 950, 952 and 970

RIN 1991-AB-09


Acquisition Regulation; Department of Energy Management and 
Operating Contracts.

AGENCY: Department of Energy.

ACTION: Proposed rule; supplemental notice.

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SUMMARY: On June 24, 1996, the Department of Energy (DOE or Department) 
published a notice of proposed rulemaking (61 FR 32588) (DOE-NOPR) to 
amend the Department of Energy Acquisition Regulation (DEAR) to 
incorporate certain contract reform initiatives. Among the contract 
reform initiatives contained in the DOE-NOPR was a proposal to amend 
the DEAR to address the treatment of costs which its management and 
operating contractors incur in proceedings involving qui tam actions. 
On June 20, 1996, the Civilian Agency Acquisition Council and the 
Defense Acquisition Council published a notice of proposed rulemaking 
(61 FR 31790) (FAR-NOPR) to amend the Federal Acquisition Regulation 
(FAR) to address the same issue. This notice solicits comments on 
whether the Department should adopt the FAR approach, instead of its 
originally proposed approach, in addressing legal costs incurred in 
connection with qui tam actions in which the Government does not 
intervene.

DATES: Written comments on the issue presented in this notice and on 
the DOE-NOPR must be submitted by August 23, 1996.

ADDRESSES: All comments are to be submitted to Connie P. Fournier, 
Office of Policy (HR-51), Department of Energy, 1000 Independence 
Avenue, SW., Washington, DC. 20585, [phone]; [phone] 
(facsimile); [e-mail] (Internet).
    The administrative record regarding this rulemaking that is on file 
for public inspection, to include a copy of the transcript of the 
public hearing scheduled for August 1st at the Department's 
Independence Avenue address, and any additional public comments 
received, is located in the Department's Freedom of Information Reading 
Room, Room 1E-190, 1000 Independence Avenue, SW., Washington, DC 20585.

FOR FURTHER INFORMATION CONTACT: Connie P. Fournier, Office of Policy 
(HR-51), Department of Energy, 1000 Independence Avenue, SW., 
Washington, DC 20585, [phone].

SUPPLEMENTARY INFORMATION: On June 24, 1996, DOE published a NOPR to 
amend the Department of Energy Acquisition Regulation (DEAR) to 
incorporate certain contract reform initiatives. Among the Department-
wide contract reform initiatives contained in the DOE-NOPR was a 
proposal to amend DEAR 970.5204-61, Cost Prohibitions Related to Legal 
and Other Proceedings, to add a new paragraph (h). The proposal 
addresses the treatment of management and operating contractor costs 
incurred in proceedings involving qui tam actions under the False 
Claims Act, 31 U.S.C. 3730, alleging fraud against the Government, 
which are not covered by the existing provisions of that clause.
    On June 20, while the Department was waiting for its own proposal 
to be published, the Civilian Agency Acquisition Council and the 
Defense Acquisition Council published a notice of proposed rulemaking 
that addresses the same issue. The FAR-NOPR approach would amend the 
cost principle at FAR 31.205-47 by amending paragraph (b), creating a 
new subparagraph (c)(2), and amending subparagraph (e)(3). Except for 
the change in existing policy contained in (e)(3), which goes beyond 
qui tam cases, the DOE-NOPR and FAR-NOPR approaches would have the same 
result. Both approaches would make legal costs connected with qui tam 
actions which result in a judgment against the contractor an 
unallowable cost, and both approaches authorize the contracting officer 
to make provisional or conditional reimbursement pending the outcome of 
a case. The only difference occurs in the event of a

[[Page 38702]]

settlement agreement, where the FAR-NOPR approach would only allow 80% 
of the contractor's costs to be reimbursed, even if the settlement 
agreement provides for full reimbursement.
    The Department is considering switching to the FAR-NOPR approach 
and amending existing paragraphs in its clause, rather than creating a 
new stand-alone paragraph. DOE urges interested members of the public 
to comment on the two approaches and whether the Department should 
adopt the FAR approach in its final rulemaking.

    Issued in Washington, DC on July 18, 1996.
Richard H. Hopf,
Deputy Assistant Secretary for Procurement and Assistance Management.
[FR Doc. 96-18774 Filed 7-24 -96; 8:45 am]
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