2011-14108. Defense Federal Acquisition Regulation Supplement; Inclusion of Option Amounts in Limitations on Authority of the Department of Defense to Carry Out Certain Prototype Projects (DFARS Case 2011-D024)

AGENCY:

Defense Acquisition Regulations System, Department of Defense (DoD).

ACTION:

Final rule.

SUMMARY:

DoD is issuing this final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement section 826 of the National Defense Authorization Act for Fiscal Year 2011. Section 826 amended the DoD pilot program for transition to follow-on contracting after use of other transaction authority, to establish that the threshold limitation of $50 million for contracts and subcontracts under the program includes the dollar value of all options.

DATES:

Effective June 8, 2011.

FOR FURTHER INFORMATION CONTACT:

Mr. Manuel Quinones, telephone [phone].

SUPPLEMENTARY INFORMATION:

I. Background

This final rule amends the DoD pilot program addressed in Defense Federal Acquisition Regulation Supplement (DFARS) Subpart 212.70, Pilot Program for Transition to Follow-On Contracting after Use of Other Transaction Authority (OTA). It adds a new section 212.7002-3, Thresholds, to clarify that, consistent with FAR 1.108(c), Dollar Thresholds, the threshold limitation for contracts and subcontracts under the pilot program of $50 million includes the dollar value of all options.

DoD has issued this rule as a final rule because the rule does not have a significant effect beyond DoD internal operating procedures as it merely reinforces current guidance in the Federal Acquisition Regulation (FAR). Further, it does not have a significant cost or administrative impact on contractors. FAR 1.108(c) currently states, in part, that “unless otherwise specified, a specific dollar threshold for the purpose of applicability is the final anticipated dollar value of the action, including the dollar value of all options.”

II. Executive Orders 12866 and 13563

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

III. Regulatory Flexibility Act

The Regulatory Flexibility Act does not apply to this rule. This final rule does not constitute a significant DFARS revision within the meaning of FAR 1.501 and public comment is not required in accordance with 41 U.S.C. 1707.

IV. Paperwork Reduction Act

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

List of Subjects in 48 CFR Part 212

• Government procurement

Mary Overstreet,

Editor, Defense Acquisition Regulations System.

Therefore, 48 CFR part 212 is amended as follows:

PART 212—ACQUISITION OF COMMERCIAL ITEMS

1. The authority citation for 48 CFR part 212 continues to read as follows:

Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.

2. Add section 212.7002-3 to subpart 212.70 to read as follows:

212.7002-3

Thresholds.

The contract and subcontract thresholds at 212.7002-1(a)(3) and 212.7002-2(a)(2) include the dollar value of all options in accordance with section 826 of the National Defense Authorization Act for Fiscal Year 2011. See also FAR 1.108(c).