[Federal Register Volume 59, Number 220 (Wednesday, November 16, 1994)]
[Unknown Section]
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From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-28191]
[[Page Unknown]]
[Federal Register: November 16, 1994]
_______________________________________________________________________
Part IV
Committee for Purchase From People Who Are Blind or Severely Disabled
_______________________________________________________________________
41 CFR Part 51-2, et al.
Revisions to Committee Regulations; Final Rule
COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR SEVERELY
DISABLED
41 CFR Parts 51-2, 51-3, 51-4, 51-5, 51-6, 51-8, and 51-9
Revisions to Committee Regulations
AGENCY: Committee for Purchase From People Who Are Blind or Severely
Disabled.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule updates the regulations of the Committee for
Purchase From People Who Are Blind or Severely Disabled to reflect
developments and changes in Committee procedures which have occurred
since the regulations were last substantively revised in 1991, and to
include wording changes that were overlooked in that revision. The new
revisions were made necessary by changes in the Government procurement
process, of which the Committee's program is a part, and by the
Committee's experiences since 1991, including litigation, which have
demonstrated that the regulations do not always clearly reflect the
authorities given the Committee by the Javits-Wagner-O'Day (JWOD) Act
and other laws as implemented in its procedures. The rule will enable
the JWOD Program to operate more efficiently to fulfill the Committee's
mission of increasing employment opportunities for people with severe
disabilities through the Government procurement process.
EFFECTIVE DATE: December 16, 1994.
ADDRESSES: Committee for Purchase From People Who Are Blind or Severely
Disabled, Crystal Square 3, Suite 403, 1735 Jefferson Davis Highway,
Arlington, Virginia 22202-3461.
FOR FURTHER INFORMATION CONTACT: G. John Heyer (703) 603-7740. Copies
of this notice will be made available on request in Wordperfect 5.1
format on diskette.
SUPPLEMENTARY INFORMATION: The Committee's regulations were last
substantively amended in 1991 (56 FR 48974, effective October 28,
1991). Those amendments were the result of the first comprehensive
review of the regulations since their promulgation in 1973. The purpose
of the current revision to the regulations is to update them to reflect
developments and changes in procedures since 1991, and to include
changes that were overlooked in the last revision.
Among the changes to part 51-2 on Committee responsibilities,
Sec. 51-2.2(b) has been amended to make clear that the Committee
authorizes and deauthorizes both central nonprofit agencies and
nonprofit agencies employing people who are blind or have other severe
disabilities to accept orders from Government agencies under the
Committee's program. Section 51-2.3 is amended to indicate that the
Committee publishes notices of proposed deletions and additions to the
Procurement List and to require interested persons who submit bound
comments on these proposals to also submit an unbound copy to be
duplicated for staff use.
Sections 51-2.4, 51-2.7, and 51-3.2 have been amended to make them
consistent with the JWOD Act, which considers a determination that a
commodity or service is suitable for addition to the Procurement List
and the establishment of an initial fair market price for the commodity
or service to be two legally separate actions. The confusing term
``current or most recent contractor'' in Sec. 51-2.4 has been changed
to ``current contractor.'' An explanation of those rare instances when
``current contractor'' means ``most recent contractor'' will be
addressed in the Committee's procedural memoranda. The Committee's
position that the ``current contractor'' includes affiliated companies
and parent corporations is explicitly stated in the amended Sec. 51-
2.4. A provision has been added to Sec. 51-2.4 to express the
Committee's position that its discretion to determine what commodities
and services are suitable for addition to the Procurement List is not
totally constrained by the enumerated criteria in the section. Section
51-2.7 has also been rewritten to reflect current Committee pricing
practices.
Section 51-2.5 has been amended to make clear that when the
Committee decides that a proposed addition is likely to have a severe
adverse impact on a current contractor, it will decide either to reduce
the portion of the Government requirement for the commodity or service
to be added to the Procurement List or will decline to add it. The
Committee's standard for reconsidering a decision to add a commodity or
service to the Procurement List, which appears in an internal
memorandum, has been added to Sec. 51-2.6.
Section 51-3.3, which deals with assignment of a commodity or
service to a central nonprofit agency for possible addition to the
Procurement List, and Secs. 51-6.4 and 51-6.12, which deal with
military resale commodities and specification changes respectively,
have been rewritten to clarify their language. Small editorial changes
for clarity have been made in Secs. 51-4.2 and 51-5.2. Recordkeeping
provisions in Sec. 51-4.3 have been changed to permit acceptance of
State certifications of disability to document individuals' disability
status in accordance with recent changes in Federal disability
regulations. The section title ``Violations'' used for both Secs. 51-
4.5 and 51-5.8 has been changed to indicate that the former applies to
violations of Committee regulations by nonprofit agencies and the
latter to violations by entities of the Government.
Section 51-5.3, which sets forth the scope of the mandatory
procurement source requirement of the JWOD Program, has been amended to
indicate that the requirement applies to items that are essentially the
same as commodities identified on the Procurement List by a National
Stock Number or other item designation. This change was made necessary
by the increasing number of commercial items in the system which are
essentially the same as Procurement List commodities. A similar change
was made in Sec. 51-6.13 on replacement and similar commodities. A new
paragraph was added to Sec. 51-5.3 to set forth the Committee's
longstanding policy that Procurement List additions do not affect
contracts in being before the effective date of the addition, or
options exercised under those contracts.
The minimum figure for prior Committee approval of purchase
exceptions granted by central nonprofit agencies in Sec. 51-5.4 has
been raised from $25,000 to the simplified acquisition threshold
established by the Federal Acquisition Streamlining Act of 1994,
currently $100,000. Sections 51-5.5 and 51-5.6 on prices and shipping
of commodities have been amended to allow for pricing and delivery on
an FOB destination basis, consistent with recent developments in
Government ordering procedures, as well as the Committee's traditional
FOB origin practice.
Section 51-6.2 has been amended in paragraph (f) to correct an
undetected typographical error in the 1991 amendments. Section 51-6.8
on deletions from the Procurement List has been amended by adding a
paragraph making it clear that the Committee can delete a commodity or
service from the Procurement List without a request from a central
nonprofit agency. A new paragraph has been added to Sec. 51-6.12 on
specification changes to indicate that nonprofit agencies are to
recommend changes that will improve the commodity or service being
provided, reduce costs, or improve overall value to the Government. The
paragraph also requires contracting activities to respond promptly to
the recommendations. Section 51-6.13 has been amended to clarify its
language and to indicate that other colors, sizes, or variations of
commodities on the Procurement List which have not been recently
procured are considered to be on the Procurement List as well.
Section 51-8.3, consisting of definitions applicable only to part
51-8 on Committee actions under the Freedom of Information Act (FOIA),
has been amended by removing the definition of the Committee, which
also appears in the general definitions for the Committee's regulations
at Sec. 51-1.3, and by changing the title ``Chairman'' to
``Chairperson'' as the title of the Committee's presiding officer. The
same change to ``Chairperson'' has also been made in Secs. 51-8.7, 51-
8.10, 51-8.11 and 51-9.405.
Changes have been made to Secs. 51-8.1 and 51-8.4 and to paragraph
(a) of Sec. 51-8.5 to make clear the distinction between material which
the Committee is required to make available for public inspection and
material which the Committee provides in response to a FOIA request.
The provision in Sec. 51-8.14 for a minimum amount for FOIA processing
costs below which no fee will be charged has been qualified to indicate
that the minimum will apply to each Committee response to a FOIA
request where it is necessary to make more than one response to a
request. The Committee bills FOIA requesters separately for each
response, which requires a decision each time as to whether the cost of
collection would exceed the amount billed.
Public Comments on the Proposed Rule
The Committee published the proposed rule in the Federal Register
of July 27, 1994 (59 FR 38318). Eighteen commenters submitted comments
on the proposed rule. Thirteen of these commenters supported the rule
as proposed, and were particularly supportive of the proposed changes
to Secs. 51-2.4, 51-2.7, and 51-3.2 to make them consistent with the
JWOD Act distinctions between suitability and fair market price
determinations.
One commenter suggested that Sec. 51-2.3 on notice of proposed
Procurement List additions and deletions be amended to require actual
notice to current contractors for the commodities or services being
considered, and to require the Committee to publish notice of the
proposal in the Commerce Business Daily as well as the Federal
Register, in order to provide wider notice of the Committee's
proposals. The Committee has considered this suggestion in the past.
However, the Committee has concluded that the benefits which adopting
this suggestion might provide are outweighed by the considerable
administrative burden which would be imposed on the Committee's small
staff. The Committee already writes to current contractors when it is
unable to obtain sales data on them from a financial reporting service,
and experience has shown that some contractors do not respond and those
who do rarely provide persuasive comments with their responses. In many
cases, Government contracting activities, trade associations, or other
persons are already notifying current contractors and other affected
parties of the Committee's intentions. Under these circumstances, the
Committee does not consider it appropriate to extend its notice of
proposed actions beyond that which is mandated by law.
The same commenter also suggested that the employment potential
requirement for a Committee determination that a commodity or service
is suitable for addition to the Procurement List, at newly redesignated
Sec. 51-2.4(a)(1), be changed to require the addition to generate
employment for a larger number of persons who are blind or have severe
disabilities than is performed by such employees of the current
contractor in connection with the commodity or service. The Committee
does not believe this change is necessary because it is already
required by law to consider and respond to all significant comments it
receives when it makes a Procurement List addition decision. It should
also be noted that the Committee's regulatory definition of persons
with severe disabilities (41 CFR 51-1.3) requires them to be incapable
of normal competitive employment over an extended period of time, a
test which employees of a competitive contractor could not meet.
This commenter also suggested that an additional factor be added to
those listed in newly redesignated Secs. 51-2.4(a)(4)(i)(A) through (C)
concerning elements of impact on a current contractor to which the
Committee gives particular attention in making a suitability
determination, to require the consideration of whether the contractor
has made an unrecovered capital or training investment in connection
with the commodity or service, and whether losing the contract will
cause idle productive capacity or unemployment in a labor surplus area.
The Committee believes this change is not needed because it already
considers any comments of this nature it receives as required by the
rulemaking statute. The Committee is also required by Sec. 51-
2.4(a)(4)(i)(C) to give particular attention to comments received on
contractor impact as a result of its notice proposing addition of the
commodity or service to the Procurement List.
Another commenter objected to the proposed addition to Sec. 51-
2.4(a)(4)(i)(A) of language indicating that the Committee looks at the
impact on a current contractor's total sales, including sales of
affiliated companies and parent corporations, in determining the
suitability of an addition to the Procurement List. The commenter felt
this position is unfair, as it can result in a heavy impact on a
corporate division. As indicated in the proposed rule, the Committee
believes that the new language is nothing more than a clarification of
its existing policy in this area, which it recently reaffirmed. Given
the ability of large corporations to shift assets between divisions,
the Committee does not believe it would be fair to the nonprofit
agencies participating in the Committee's program to assess impact on a
part of a large corporation in the same manner as a small independent
business.
This same commenter objected to new language in Sec. 51-2.5
concerning the addition to the Procurement List of a commodity or
service ``in whole or in part.'' The commenter felt that this language
would permit the Committee to extend the reach of a Procurement List
addition beyond a particular commodity into a larger line of
commodities. The Committee believes that the commenter misunderstood
the intent of the change, which was discussed in the proposed rule. The
Committee's intent was to clarify an existing provision which permits
the Committee, when it decides that a proposed addition to the
Procurement List of the total Government requirement for a commodity or
service is likely to have a severe adverse impact on a current
contractor, to add only a part of the requirement to lessen the impact
on the contractor. There is no intent in this language to permit the
expansion of the addition beyond what is specifically stated in the
final rule making a Procurement List addition.
Another commenter suggested that the phrase ``harm to the
contracting activity'' in Sec. 51-2.6(b) listing the factors the
Committee addresses when reconsidering a Procurement List addition
decision be changed to ``harm to the Government'' to allow
consideration of harm to ultimate Government users of items purchased
for them under the Committee's program by contracting activities. The
Committee agrees with the commenter and has amended Sec. 51-2.6(b)
accordingly.
The same commenter suggested that language in Sec. 51-2.7 requiring
the Committee to consider recommendations from contracting activities
in setting initial fair market prices not based on competitive bids be
broadened to permit contracting activity comments on all Committee
pricing determinations. The Committee does not agree with the
commenter. When initial fair market prices are established based on
bids, the process is an automatic one based on the bid history of the
commodity or service in question. There is no place for comments,
unlike the alternate process of setting prices based on nonprofit
agency costs, where a wider variety of information is allowable to
determine what these costs actually are. As the commenter noted, the
Committee has allowed contracting activities to make comments on
pricing determinations whenever appropriate, so a requirement to accept
these comments is not necessary. The Committee has modified the
sentence, however, to make it clear that the no-comment rule applies
only to initial fair market price determinations based on competitive
bids and not to price changes.
One commenter noted that Sec. 51-2.7 provides some detail on the
Committee's method of making initial fair market price determinations,
but very little on how price changes are determined, which is set forth
on Committee procedures. The Committee has modified Sec. 51-2.7 to
identify the price change methods used and to make reference to the
Committee procedures where the details are set forth.
The same commenter also suggested that Sec. 51-2.7 be amended to
prohibit the establishment of an initial fair market price that is more
than twenty percent above the existing Government price for the
commodity or service. Current Committee policy already prohibits such a
high price, so a change in the regulations is not necessary.
One commenter asked for clarification of the term ``other persons''
in a new sentence in Sec. 51-5.2(e) concerning ordering of Procurement
List commodities available only from nonprofit agencies. This term is
part of a phrase extending the mandatory source requirement applicable
to Government agencies to others providing the commodities to the
agencies by contract which already appears in Sec. 51-5.2(c) and (d),
and is only added to make it clear that the same requirement applies to
orders covered by Sec. 51-5.2(e) as well. While the Committee agrees
with the commenter that the term was originally intended to apply in
all three cases to commercial suppliers under contract to Government
agencies, the Committee believes that the broader language is justified
by the JWOD Act and is appropriate to address similar situations which
might not be covered by a more restrictive term.
Two commenters suggested that language added to Sec. 51-5.3(a) by
the proposed rule to extend the mandatory source requirement to
commodities ``essentially the same'' as those on the Procurement List
be deleted, along with new Sec. 51-6.13(c) which indicates that
contracting activities are not permitted to purchase commercial items
that are essentially the same as commodities on the Procurement List.
One of these commenters indicated that this language would allow the
Committee to add commodities to the Procurement List without performing
individual suitability evaluations. The other commenter objected to the
lack of a definition for ``essentially the same,'' and indicated that
the concept would make it difficult for contracting activities to
comply with the Administration policy and new statutory mandate to
acquire commercial products whenever possible.
As the proposed rule implied, this change was made necessary by the
recent threat of proliferation in the Government supply system of
commercial items which are essentially identical to commodities
produced under the JWOD Program. The purpose of the JWOD Act, to create
employment for persons who are blind or have other severe disabilities,
would be nullified if contracting activities could evade the JWOD Act's
mandate simply by purchasing items which differed from JWOD Program
commodities only in brand name or other insignificant features. The
Committee, which includes a number of leading Government procurement
officials, has carefully considered this change and has decided that it
is important for the JWOD Program and within the intent of the JWOD
Act.
The Committee does not intend to use this concept as a substitute
for individual evaluation of new commodities to determine their
suitability for addition to the Procurement List. The concept will be
used to identify commercial items which duplicate or differ only
marginally from Procurement List commodities, to insure that
contracting activities do not purchase the former instead of the
latter. The Committee is already working actively with one of the JWOD
Program's major Government customers to identify such commercial items.
Because these determinations must be made on a case by case basis, the
Committee does not believe that a specific definition of the concept is
possible. The Committee does believe that the JWOD Program and the
commercial items acquisition policy can coexist successfully, and that
this new concept will be a useful tool for assuring that this will
happen.
One commenter suggested that the phrase ``simplified acquisition
threshold'' be used instead of the figure ``$100,000'' as the limit for
central nonprofit agency issuance of purchase exceptions without
Committee approval stated in Sec. 51-5.4. The commenter noted that this
change would make the provision consistent with the new procurement
reform statute and would avoid the need for further changes in the
Committee's regulation if the threshold changed in the future. The
Committee has adopted this suggestion. As the proposed rule indicated,
the Committee's intent in changing the figure from $25,000 to $100,000
was to be consistent with this legislation.
One commenter noted that the policy of stocking military resale
commodities, which is set forth in Sec. 51-6.4, has been changed to
require exclusive stocking of commodities in the 800- as well as 900-
series. The Committee has revised the section accordingly.
One commenter requested clarification of the pricing of replacement
commodities as described in Sec. 51-6.13(a). The Committee has revised
the provision to make it clear that the fair market price is the one
set for the replacement commodity, not the price for the commodity
being replaced.
Another commenter objected to the substitution of the word
``recently'' for ``previously'' in the description of a replacement
commodity in Sec. 51-6.13(a) as one ``which has not been recently
procured.'' The commenter recommended the use of a specific period of
time in this context, such as ``one year.'' The Committee believes this
recommendation would make the provision unnecessarily restrictive,
particularly if a one-year limit were adopted, and would deny the
Committee the flexibility it needs to respond to individual
circumstances.
One commenter objected to the term ``other variations'' in new
Sec. 51-6.13(b), which extends Procurement List status to additional
sizes, colors, or other variations of a commodity on the Procurement
List if these similar commodities have not been recently procured.
Another commenter, on the other hand, applauded this additional size,
color, and variation terminology as clarifying the scope of what a
Procurement List commodity is.
Like the ``essentially the same'' concept discussed earlier in this
notice, the Committee considers the language in Sec. 51-6.13(b) which
the commenters have noted to be an important part of defining the scope
of a Procurement List commodity in the new Government procurement
environment. The term ``other variations'' is necessary to reach items
which are essentially the same as Procurement List commodities where
the difference cannot be defined in terms of size or color.
Consequently, deletion of the term from Sec. 51-6.13(b) would deny the
Committee the flexibility it needs to carry out its mission.
A commenter suggested that the Committee regulations should contain
a provision allowing contracting officers to terminate for default
nonprofit agencies which fail to perform as required, and/or to apply
liquidated damages in such instances. Because of the differences in the
JWOD Program from competitive contracting, particularly the statutory
mandatory source requirement, the Committee has long used an
alternative method of resolving contractor performance problems. This
method is set forth in Part 51-6 of the Committee's regulations, and
includes a dispute resolution procedure which involves the central
nonprofit agency concerned in situations which cannot be resolved
between the nonprofit agency and the contracting officer, with a right
of appeal to the Committee, as well as a purchase exception procedure
which affords the contracting activity relief from the mandatory source
requirement in cases where the nonprofit agency truly cannot meet the
Government's requirements. The Committee has also allowed price
reductions and other consideration in return for late deliveries, in
appropriate circumstances. In light of the existence of these
procedures, which have worked well over the years to minimize disputes
and speed their resolution, the Committee does not believe that the
approach suggested by the commenter would be an improvement, and it
would deny the Committee the flexibility it needs to make its program
run effectively.
Regulatory Flexibility Act
I certify that this revision of the Committee regulations will not
have a significant economic impact on a substantial number of small
entities because the revisions basically update and clarify program
policies and procedures and do not essentially change the impact of the
regulations on small entities.
Paperwork Reduction Act
The Paperwork Reduction Act does not apply to this regulatory
revision because it contains no information collection or recordkeeping
requirements as defined in that Act and its regulations.
Executive Order No. 12866
The Committee has been exempted from the regulatory review
requirements of the Executive Order by the Office of Information and
Regulatory Affairs. Additionally, this revision to the Committee's
regulations is not a significant regulatory action as defined in the
Executive Order.
List of Subjects
41 CFR Parts 51-2 Through 51-6
Government procurement, Handicapped, Organization and functions
(Government agencies), Reporting and recordkeeping requirements.
41 CFR Part 51-8
Freedom of information.
41 CFR Part 51-9
Privacy.
For the reasons set out in the preamble, parts 51-2 through 51-6,
51-8 and 51-9 of title 41, chapter 51 of the Code of Federal
Regulations are amended as follows:
1. The authority citation for parts 51-2 through 51-6 continues to
read as follows:
Authority: 41 U.S.C. 46-48C.
PART 51-2--COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR
SEVERELY DISABLED
2. Section 51-2.2 is amended by adding the following sentence at
the end of paragraph (b):
Sec. 51-2.2 Powers and responsibilities.
* * * * *
(b) * * * Authorize and deauthorize central nonprofit agencies and
nonprofit agencies to accept orders from contracting activities for the
furnishing of specific commodities and services on the Procurement
List.
* * * * *
3. Section 51-2.3 is revised to read as follows:
Sec. 51-2.3 Notice of proposed addition or deletion.
At least 30 days prior to the Committee's consideration of the
addition or deletion of a commodity or service to or from the
Procurement List, the Committee publishes a notice in the Federal
Register announcing the proposed addition or deletion and providing
interested persons an opportunity to submit written data or comments on
the proposal. Interested persons submitting comments in bound form
should also submit an unbound copy that is capable of being legibly
photocopied.
4. Section 51-2.4 is amended by removing paragraph (d),
redesignating the introductory text and paragraphs (a) through (c) as
paragraphs (a) through (a)(3), redesignating paragraphs (e) through
(e)(3) as paragraphs (a)(4) through (a)(4)(ii), revising the newly
redesignated paragraphs (a), introductory text, (a)(4) through
(a)(4)(ii), and adding paragraph (b) to read as follows:
Sec. 51-2.4 Determination of suitability.
(a) For a commodity or service to be suitable for addition to the
Procurement List, each of the following criteria must be satisfied:
* * * * *
(4) Level of impact on the current contractor for the commodity or
service. (i) In deciding whether or not a proposed addition to the
Procurement List is likely to have a severe adverse impact on the
current contractor for the specific commodity or service, the Committee
gives particular attention to:
(A) The possible impact on the contractor's total sales, including
the sales of affiliated companies and parent corporations. In addition,
the Committee considers the effects of previous Committee actions.
(B) Whether that contractor has been a continuous supplier to the
Government of the specific commodity or service proposed for addition
and is, therefore, more dependent on the income from such sales to the
Government.
(C) Any substantive comments received as the result of the notice
of the proposed addition in the Federal Register.
(ii) If there is not a current contract for the commodity or
service being proposed for addition to the Procurement List, the
Committee may consider the most recent contractor to furnish the item
to the Government as the current contractor for the purpose of
determining the level of impact.
(b) In determining the suitability of a commodity or service for
addition to the Procurement List, the Committee also considers other
information it deems pertinent, including comments on a proposal
published in the Federal Register to add the commodity or service to
the Procurement List and information submitted by Government personnel
and interested persons.
5. Section 51-2.5 is revised to read as follows:
Sec. 51-2.5 Committee decision.
The Committee considers the particular facts and circumstances in
each case in determining if a commodity or service is suitable for
addition to the Procurement List. When the Committee determines that a
proposed addition is likely to have a severe adverse impact on a
current contractor, it takes this fact into consideration in deciding
not to add the commodity or service to the Procurement List, or to add
only a portion of the Government requirement for the item. If the
Committee decides to add a commodity or service in whole or in part to
the Procurement List, that decision is announced in the Federal
Register with a notice that includes information on the effective date
of the addition.
6. Section 51-2.6 is amended by redesignating the current text of
the section as paragraph (a) and adding paragraph (b) to read as
follows:
Sec. 51-2.6 Reconsideration of Committee decision.
(a) * * *
(b) In reconsidering its decision, the Committee will balance the
harm to the party requesting reconsideration if the item remains on the
Procurement List against the harm which the nonprofit agency or its
employees who are blind or have other severe disabilities would suffer
if the item were deleted from the Procurement List. The Committee may
also consider information bringing into question its conclusions on the
suitability criteria on which it based its original decision as factors
weighing toward a decision to delete the item, and information
concerning possible harm to the Government and the JWOD Program as
factors weighing toward confirmation of the original decision.
7. Section 51-2.7 is revised to read as follows:
Sec. 51-2.7 Fair market price.
The Committee is responsible for determining the fair market
prices, and changes thereto, for commodities and services on the
Procurement List. The Committee establishes the initial fair market
price at the time a commodity or service is added to the Procurement
List. In cases where initial prices are not based on competitive bids,
the Committee considers recommendations from contracting activities and
the central nonprofit agency concerned. Prices are revised in
accordance with changing market conditions as reflected primarily by
economic indices and changes in nonprofit agency costs, as provided in
Committee pricing procedures. Recommendations for fair market prices or
changes thereto shall be submitted by the nonprofit agencies to the
appropriate central nonprofit agency. The central nonprofit agency
shall analyze the data and submit a recommended fair market price to
the Committee accompanied by the information required by the
Committee's pricing procedures to support the recommended price.
PART 51-3--CENTRAL NONPROFIT AGENCIES
8. Section 51-3.2 is amended by revising paragraph (d),
redesignating paragraphs (e) through (m) as paragraphs (f) through (n),
and adding a new paragraph (e) to read as follows:
Sec. 51-3.2 Responsibilities under the JWOD Program.
* * * * *
(d) Recommend to the Committee, with the supporting information
required by Committee procedures, suitable commodities or services for
procurement from its nonprofit agencies.
(e) Recommend to the Committee, with the supporting information
required by Committee procedures, initial fair market prices for
commodities or services proposed for addition to the Procurement List.
* * * * *
9. Section 51-3.3 is revised to read as follows:
Sec. 51-3.3 Assignment of commodity or service.
(a) The central nonprofit agencies shall determine by mutual
agreement the assignment to one of them of a commodity or service for
the purpose of evaluating its potential for possible future addition to
the Procurement List, except that the Committee shall initially assign
a commodity to National Industries for the Blind when NISH has
expressed an interest in the commodity and National Industries for the
Blind has exercised the blind priority.
(b) NISH shall provide National Industries for the Blind with
procurement information necessary for a decision to exercise or waive
the blind priority when it requests a decision. National Industries for
the Blind shall normally notify NISH of its decision within 30 days,
but not later than 60 days after receipt of the procurement
information, unless the two central nonprofit agencies agree to an
extension of time for the decision. Disagreements on extensions shall
be referred to the Committee for resolution.
(c) If National Industries for the Blind exercises the blind
priority for a commodity, it shall immediately notify the Committee and
NISH and shall submit to the Committee a proposal to add the commodity
to the Procurement List within nine months of the notification, unless
the Committee extends the assignment period because of delays beyond
the control of National Industries for the Blind. Upon expiration of
the assignment period, the Committee shall reassign the commodity to
NISH.
(d) The central nonprofit agency assigned a commodity shall obtain
a decision from Federal Prison Industries on the exercise or waiver of
its priority and shall submit the procurement information required by
Federal Prison Industries when it requests the decision. Federal Prison
Industries shall normally notify the central nonprofit agency of its
decision within 30 days, but not later than 60 days after receipt of
the procurement information, unless it agrees with the central
nonprofit agency on an extension of time for the decision. The central
nonprofit agency shall refer a disagreement over an extension to the
Committee for resolution with Federal Prison Industries.
(e) The central nonprofit agency shall provide the Committee the
decision of Federal Prison Industries on the waiver or exercise of its
priority when it requests the addition of the commodity to the
Procurement List. NISH shall also provide the decision of National
Industries for the Blind waiving its priority.
PART 51-4--NONPROFIT AGENCIES
10. Section 51-4.2 is amended by revising paragraph (a)(1)
introductory text, and (a)(2) introductory text, to read as follows:
Sec. 51-4.2 Initial qualification.
(a) * * *
(1) A privately incorporated nonprofit agency shall submit to the
Committee through its central nonprofit agency the following documents,
transmitted by a letter signed by an officer of the corporation or
chief executive:
* * * * *
(2) A State-owned or State-operated nonprofit agency, or a
nonprofit agency established or authorized by a State statute other
than the State corporation laws and not privately incorporated, shall
submit to the Committee through its central nonprofit agency the
following documents, transmitted by a letter signed by an officer of
the wholly-owned State corporation or an official of the agency that
directs the operations of the nonprofit agency, as applicable:
* * * * *
11. Section 51-4.3 is amended by revising paragraphs (b)(6) and
(c)(1) to read as follows:
Sec. 51-4.3 Maintaining qualification.
* * * * *
(b) * * *
(6) Maintain a file on each blind individual performing direct
labor which contains a written report reflecting visual acuity and
field of vision of each eye, with best correction, signed by a person
licensed to make such an evaluation, or a State certification of
blindness.
* * * * *
(c) * * *
(1) A written report signed by a licensed physician, psychiatrist,
or qualified psychologist, reflecting the nature and extent of the
disability or disabilities that cause such person to qualify as a
person with a severe disability, or a State certification listing the
disability or disabilities.
* * * * *
12. Section 51-4.5 is amended by revising the section heading to
read as follows:
Sec. 51-4.5 Violations by nonprofit agencies.
* * * * *
PART 51-5--CONTRACTING REQUIREMENTS
13. Section 51-5.2 is amended by revising the section heading and
paragraph (a) and adding a second sentence to paragraph (e) to read as
follows:
Sec. 51-5.2 Mandatory source requirement.
(a) Nonprofit agencies designated by the Committee are mandatory
sources of supply for all entities of the Government for commodities
and services included on the Procurement List, as provided in Sec. 51-
1.2 of this chapter.
* * * * *
(e) * * * This requirement applies both to contracting activities
and to other persons providing such commodities to them by contract.
* * * * *
14. Section 51-5.3 is amended by revising the first sentence of
paragraph (a) and adding paragraph (c) to read as follows:
Sec. 51-5.3 Scope of requirement.
(a) When a commodity is included on the Procurement List, the
mandatory source requirement covers the National Stock Number or item
designation listed and commodities that are essentially the same as the
listed item. * * *
* * * * *
(c) When a commodity or service is added to the Procurement List,
the addition does not affect contracts for the commodity or service
awarded prior to the effective date of the Procurement List addition or
options exercised under those contracts.
15. Section 51-5.4 is amended by revising paragraph (d) and the
second sentence of paragraph (f)(1) to read as follows:
Sec. 51-5.4 Purchase exceptions.
* * * * *
(d) The central nonprofit agency shall obtain the approval of the
Committee before granting a purchase exception when the value of the
procurement exceeds the simplified acquisition threshold set forth in
the Federal Acquisition Streamlining Act of 1994 or any subsequent
amendments thereto.
* * * * *
(f)* * *
(1)* * * The deadline may be extended by the central nonprofit
agency with, in cases of procurements exceeding the simplified
acquisition threshold, the concurrence of the Committee.
* * * * *
16. Section 51-5.5 is amended by revising paragraph (b) to read as
follows:
Sec. 51-5.5 Prices.
* * * * *
(b) Prices for commodities include applicable packaging, packing,
and marking. Prices include transportation to point of delivery as
specified in Sec. 51-5.6.
* * * * *
17. Section 51-5.6 is revised to read as follows:
Sec. 51-5.6 Shipping.
(a) Except as provided in paragraph (c) of this section for
commodities other than military resale commodities, delivery is
accomplished when a shipment is placed aboard the vehicle of the
initial carrier. Time of delivery is when the shipment is released to
and accepted by the initial carrier.
(b) Method of transportation to destination shall normally be by
Government bills of lading although the contracting activity may
designate another method of transportation on its order, in accordance
with Committee procedures. Government bills of lading may accompany
orders or be otherwise furnished, but shall be supplied promptly. If
the contracting activity fails to designate a method of transportation
or furnish a Government bill of lading promptly, it shall constitute an
excusable cause for delay in delivery.
(c) The Committee may determine that for certain commodity orders,
delivery is accomplished when the shipment is delivered to the
purchaser's facility (plant, warehouse, store, lot, or other location
to which shipment can be made). Time of delivery for these orders is
when the shipment is released by the carrier and accepted by the
purchaser. Under this method of transportation, the nonprofit agency
will normally ship by commercial bills of lading and will be
responsible for any loss or damage to the goods occurring before
receipt of the shipment at the delivery point specified. The nonprofit
agency will prepare and distribute commercial bills of lading, furnish
a delivery schedule and designate the mode of delivering carrier, and
pay all charges to the specified point of delivery.
Sec. 51-5.8 Violations by entities of the Government.
* * * * *
18. Section 51-5.8 is amended by revising the section heading to
read as set forth above.
PART 51-6--PROCUREMENT PROCEDURES
19. Section 51-6.2 is amended by revising the second sentence in
paragraph (f) to read as follows:
Sec. 51-6.2 Allocation process.
* * * * *
(f)* * * When a request for allocation provides a delivery schedule
(based on established lead times and time required for processing the
allocation request) which cannot be met, the central nonprofit agency
shall request a revision, which the contracting activity shall grant,
if feasible, or the central nonprofit agency shall issue a purchase
exception authorizing procurement from commercial sources as provided
in Sec. 51-5.4 of this chapter.
* * * * *
20. Section 51-6.4 is amended by revising paragraphs (a), (b),
(c)(3), (c)(4), and (d), and the second sentence of paragraph (e) to
read as follows:
Sec. 51-6.4 Military resale commodities.
(a) Purchase procedures for ordering military resale commodities
are available from the central nonprofit agencies. Authorized resale
outlets (military commissary stores, Armed Forces exchanges and like
activities of other Government departments and agencies) shall request
the central nonprofit agency responsible for the military resale
commodity being ordered to designate the nonprofit agency or its agent
to which the outlets shall forward orders.
(b) Authorized resale outlets shall stock military resale
commodities in as broad a range as practicable. Authorized resale
outlets may stock commercial items comparable to the military resale
commodities they stock, except that military commissary stores shall
stock military resale commodities in the 800- and 900-series
exclusively, unless an exception has been granted on an individual
store basis for the stocking of comparable commercial items for which
there is a significant customer demand.
(c) * * *
(3) Issue guidance requiring commissary store personnel to maximize
sales potential of military resale commodities.
(4) Establish policies and procedures which reserve to its agency
headquarters the authority to grant exceptions to the exclusive
stocking of 800- and 900-series military resale commodities.
(d) The Defense Commissary Agency shall provide the Committee a
copy of each directive which relates to the stocking of military resale
commodities in commissary stores, including exceptions authorizing the
stocking of commercial items in competition with 800- and 900-series
military resale commodities.
(e) * * * Zone pricing is used for delivery to Alaska and Hawaii.
21. Section 51-6.8 is amended by adding paragraph (e) to read as
follows:
Sec. 51-6.8 Deletion of items from the Procurement List.
* * * * *
(e) The Committee may delete an item from the Procurement List
without a request from a central nonprofit agency if the Committee
determines that none of the nonprofit agencies participating in the
JWOD Program are capable and desirous of furnishing the commodity or
service to the Government, or if the Committee decides that the
commodity or service is no longer suitable for procurement from
nonprofit agencies employing people who are blind or have other severe
disabilities. In considering such an action, the Committee will consult
with the appropriate central nonprofit agency, the nonprofit agency or
agencies involved, and the contracting activity.
22. Section 51-6.12 is amended by revising paragraphs (a), (c), and
(d) and adding paragraph (e) to read as follows:
Sec. 51-6.12 Specification changes and similar actions.
(a) Contracting activities shall notify the nonprofit agency or
agencies authorized to furnish a commodity on the Procurement List and
the central nonprofit agency concerned of any changes to the
specification or other description of the commodity.
* * * * *
(c) For services on the Procurement List, the contracting activity
shall notify the nonprofit agency furnishing the service and the
central nonprofit agency concerned at least 90 days prior to the date
that any changes in the statement of work or other conditions of
performance will be required.
(d) If an emergency makes it impossible for a contracting activity
to give the 90-day notice required by paragraphs (b) and (c) of this
section, the contracting activity shall inform the nonprofit agency and
the central nonprofit agency concerned of the reasons it cannot meet
the 90-day notice requirement when it places the order or change
notice.
(e) Nonprofit agencies shall recommend changes in specifications,
item descriptions, and statements of work that will improve the
commodity or service being provided, reduce costs, or improve overall
value to the Government. Contracting activities shall respond promptly
to these recommendations and work with the nonprofit agencies to
implement them when appropriate.
23. Section 51-6.13 is revised to read as follows:
Sec. 51-6.13 Replacement and similar commodities.
(a) When a commodity on the Procurement List is replaced by another
commodity which has not been recently procured, and a nonprofit agency
can furnish the replacement commodity in accordance with the
Government's quality standards and delivery schedules, the replacement
commodity is automatically considered to be on the Procurement List and
shall be procured from the nonprofit agency designated by the Committee
at the fair market price the Committee has set for the replacement
commodity. The commodity being replaced shall continue to be included
on the Procurement List until there is no longer a Government
requirement for that commodity.
(b) If contracting activities desire to procure additional sizes,
colors, or other variations of a commodity after the commodity is added
to the Procurement List, and these similar commodities have not
recently been procured, these commodities are also automatically
considered to be on the Procurement List.
(c) In accordance with Sec. 51-5.3 of this chapter, contracting
activities are not permitted to purchase commercial items that are
essentially the same as commodities on the Procurement List.
PART 51-8--PUBLIC AVAILABILITY OF AGENCY MATERIALS
24. The authority citation for Part 51-8 continues to read as
follows:
Authority: 5 U.S.C. 552.
25. Section 51-8.1 is revised to read as follows:
Sec. 51-8.1 Purpose.
These regulations implement the provisions of the ``Freedom of
Information Act,'' 5 U.S.C. 552. They establish procedures under which
the public may inspect and obtain copies of material maintained by the
Committee, provide for administrative appeal of initial determinations
to deny requests for material, and prescribe fees to be charged by the
Committee to recover search, review, and duplication costs.
26. Section 51-8.3 is amended by revising the introductory text of
the section, removing paragraph (b), redesignating paragraphs (c)
through (i) as paragraphs (b) through (h), and revising newly
redesignated paragraph (b), to read as follows:
Sec. 51-8.3 Definitions.
As used in this part:
(a) * * *
(b) The term Chairperson means the Chairperson of the Committee for
Purchase From People Who Are Blind or Severely Disabled.
* * * * *
27. Section 51-8.4 is revised to read as follows:
Sec. 51-8.4 Availability of materials.
Material described in 5 U.S.C. 552(a)(2) shall be available for
inspection during normal business hours at the Committee's offices,
Crystal Square 3, Suite 403, 1735 Jefferson Davis Highway, Arlington,
Virginia 22202-3461. An individual who intends to visit the Committee
offices to inspect this material shall make an appointment with the
Executive Director at least one week in advance, except when the
Committee has provided notification to the individual that the material
is available for inspection in the Committee offices, in which case an
appointment must be made at least 24 hours in advance.
28. Section 51-8.5 is amended by revising the first sentence in
paragraph (a) to read as follows:
Sec. 51-8.5 Requests for records.
(a) Requests to obtain copies of any material maintained by the
Committee must be submitted in writing to the Executive Director at the
Committee's offices, Crystal Square 3, Suite 403, 1735 Jefferson Davis
Highway, Arlington, Virginia 22202-3461. * * *
* * * * *
Sec. 51-8.7 [Amended]
29. Section 51-8.7 is amended by removing ``Chairman'' where it
appears in paragraph (e) and replacing it with ``Chairperson.''
Sec. 51-8.10 [Amended]
30. Section 51-8.10 is amended by removing ``Chairman'' where it
appears in paragraphs (a), (b), (c), and (d) and replacing it with
``Chairperson'' in each place it occurs.
Sec. 51-8.11 [Amended]
31. Section 51-8.11 is amended by removing ``Chairman'' where it
appears in paragraph (a) and replacing it with ``Chairperson.'' 32.
Section 51-8.14 is amended by revising paragraph (c) to read as
follows:
Sec. 51-8.14 Fee waivers and reductions.
* * * * *
(c) Fees shall be waived in all circumstances where the amount of
the fee is $10 or less as the cost of collection would be greater than
the fee. This minimum shall be applied separately to each Committee
response when it is necessary for the Committee to make more than one
response to a request for records.
PART 51-9--PRIVACY ACT RULES
33. The authority citation for Part 51-9 is revised to read as
follows:
Authority: 5 U.S.C. 552a.
Sec. 51-9.405 [Amended]
34. Section 51-9.405 is amended by removing ``Chairman'' wherever
it appears in each paragraph of the section and replacing it with
``Chairperson'' in each place it occurs.
Dated: November 9, 1994.
Beverly L. Milkman,
Executive Director.
[FR Doc. 94-28191 Filed 11-15-94; 8:45 am]
BILLING CODE 6820-33-P
