94-20726. Federal Acquisition Regulation; Allowability of Value Engineering Costs; Withdrawal of Proposed Rule

[Federal Register Volume 59, Number 163 (Wednesday, August 24, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-20726]


[[Page Unknown]]

[Federal Register: August 24, 1994]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Part 48

[FAR Cases 89-88]

 

Federal Acquisition Regulation; Allowability of Value Engineering 
Costs; Withdrawal of Proposed Rule

AGENCY: Department of Defense (DOD), General Service Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule; withdrawal.

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SUMMARY: The Department of Defense, General Services Administration, 
and National Aeronautics and Space Administration have decided to 
withdraw a proposed rule, FAR case 89-88, Allowability of Value 
Engineering Costs. This rule was initially published in the Federal 
Register on January 4, 1990 (55 FR 416), and republished on December 
14, 1992 (57 FR 59274). The case proposed a revision which specifies 
that under the incentive approach in value engineering, the contractor 
develops and submits value engineering change proposals (VECP's) and 
shares in the savings of any that are accepted. The contract provides 
for payment of implementation costs if a VECP is accepted. The 
development costs for accepted and unaccepted VECP's shall be 
accumulated by value engineering project and charged indirectly if 
otherwise allowable in accordance with Part 31. The republication 
resulted in the receipt of 30 responses. The substantive comments 
ranged from acceptance of the rule with modification to strong 
recommendations that the rule not be adopted. Primary concerns 
included--the source of funding for the payment of development costs of 
unaccepted VECP's, the documentation and justification required for 
such payments, and the administrative impact on the Government from a 
potential increase in VECP submissions. As a result of discussions with 
interested industry representatives and the nature of the comments 
received, a decision was made to withdraw the proposed rule.

FOR FURTHER INFORMATION CONTACT:
Ms. Beverly Fayson, FAR Secretariat, Room 4037, GS Building, 
Washington, DC 20405 [phone].

List of Subjects in 48 CFR Part 48

    Government procurement.

    Dated: August 18, 1994.
Harry S. Rosinski,
Acting Director, Office of Federal Acquisition Policy.
[FR Doc. 94-20726 Filed 8-23-94; 8:45 am]
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