[Title 48 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 2000 Edition]
[From the U.S. Government Printing Office]
[[Page i]]
48
Chapters 3 to 6
Revised as of October 1, 2000
Federal Acquisition Regulations System
Containing a Codification of documents of general
applicability and future effect
As of October 1, 2000
With Ancillaries
Published by
Office of the Federal Register
National Archives and Records
Administration
As a Special Edition of the Federal Register
[[Page ii]]
U.S. GOVERNMENT PRINTING OFFICE
WASHINGTON : 2000
For sale by U.S. Government Printing Office
Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328
[[Page iii]]
Table of Contents
Page
Explanation................................................. v
Title 48:
Chapter 3--Department of Health and Human Services 3
Chapter 4--Department of Agriculture 227
Chapter 5--General Services Administration 293
Chapter 6--Department of State 421
Finding Aids:
Table of CFR Titles and Chapters........................ 495
Alphabetical List of Agencies Appearing in the CFR...... 513
List of CFR Sections Affected........................... 523
[[Page iv]]
----------------------------
Cite this Code: CFR
To cite the regulations in
this volume use title,
part and section number.
Thus, 48 CFR 301.101
refers to title 48, part
301, section 101.
----------------------------
[[Page v]]
EXPLANATION
The Code of Federal Regulations is a codification of the general and
permanent rules published in the Federal Register by the Executive
departments and agencies of the Federal Government. The Code is divided
into 50 titles which represent broad areas subject to Federal
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parts covering specific regulatory areas.
Each volume of the Code is revised at least once each calendar year
and issued on a quarterly basis approximately as follows:
Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1
The appropriate revision date is printed on the cover of each
volume.
LEGAL STATUS
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HOW TO USE THE CODE OF FEDERAL REGULATIONS
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OMB CONTROL NUMBERS
The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires
Federal agencies to display an OMB control number with their information
collection request.
[[Page vi]]
Many agencies have begun publishing numerous OMB control numbers as
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requirements.
OBSOLETE PROVISIONS
Provisions that become obsolete before the revision date stated on
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of provisions in effect on a given date in the past by using the
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1963, 1964-1972, or 1973-1985, published in seven separate volumes. For
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A subject index to the Code of Federal Regulations is contained in a
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The Federal Register Index is issued monthly in cumulative form.
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the revision dates of the 50 CFR titles.
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[[Page vii]]
The Office of the Federal Register also offers a free service on the
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Raymond A. Mosley,
Director,
Office of the Federal Register.
October 1, 2000.
[[Page ix]]
THIS TITLE
Title 48--Federal Acquisition Regulations System is composed of
seven volumes. The chapters in these volumes are arranged as follows:
Chapter 1 (parts 1 to 51), chapter 1 (parts 52 to 99), chapter 2 (parts
201 to 299), chapters 3 to 6, chapters 7 to 14, chapters 15 to 28 and
chapter 29 to end. The contents of these volumes represent all current
regulations codified under this title of the CFR as of October 1, 2000.
The Federal acquisition regulations in chapter 1 are those
government-wide acquisition regulations jointly issued by the General
Services Administration, the Department of Defense, and the National
Aeronautics and Space Administration. Chapters 2 through 99 are
acquisition regulations issued by individual government agencies. Parts
1 to 69 in each of chapters 2 through 99 are reserved for agency
regulations implementing the Federal acquisition regulations in chapter
1 and are numerically keyed to them. Parts 70 to 99 in chapters 2
through 99 contain agency regulations supplementing the Federal
acquisition regulations.
The OMB control numbers for the Federal Acquisition Regulations
System appear in section 1.106 of chapter 1. For the convenience of the
user section 1.106 is reprinted in the Finding Aids section of the
second volume containing chapter 1 (parts 52 to 99).
The first volume, containing chapter 1 (parts 1 to 51), includes an
index to the Federal acquisition regulations.
For this volume, Melanie L. Marcec was Chief Editor. The Code of
Federal Regulations publication program is under the direction of
Frances D. McDonald, assisted by Alomha S. Morris.
[[Page x]]
[[Page 1]]
TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
(This book contains chapters 3 to 6)
--------------------------------------------------------------------
Part
chapter 3--Department of Health and Human Services.......... 301
chapter 4--Department of Agriculture........................ 401
chapter 5--General Services Administration.................. 501
chapter 6--Department of State.............................. 601
[[Page 3]]
CHAPTER 3--DEPARTMENT OF HEALTH AND HUMAN SERVICES
--------------------------------------------------------------------
SUBCHAPTER A--GENERAL
Part Page
301 HHS Acquisition Regulation System........... 5
302 Definitions of words and terms.............. 13
303 Improper business practices and personal
conflicts of interest................... 14
304 Administrative matters...................... 17
SUBCHAPTER B--ACQUISITION PLANNING
305 Publicizing contract actions................ 24
306 Competition requirements.................... 25
307 Acquisition planning........................ 28
309 Contractor qualifications................... 41
SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
313 Small purchase and other simplified purchase
procedures.............................. 45
314 Formal advertising.......................... 47
315 Contracting by negotiation.................. 48
316 Types of contracts.......................... 80
317 Special contracting methods................. 84
SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
319 Small business and small disadvantaged
business concerns....................... 87
320 Labor surplus area concerns................. 94
322 Application of labor laws to Government
acquisitions............................ 94
324 Protection of privacy and freedom of
information............................. 95
325 Foreign acquisition......................... 97
SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
328 Bonds and insurance......................... 100
330 Cost accounting standards................... 100
332 Contract financing.......................... 100
[[Page 4]]
333 Protests, disputes, and appeals............. 104
SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
334 Major system acquisition.................... 111
335 Research and development contracting........ 111
337 Service contracting......................... 114
339 Management, acquisition, and use of
information resources................... 117
SUBCHAPTER G--CONTRACT MANAGEMENT
342 Contract administration..................... 119
345 Government property......................... 124
SUBCHAPTER H--CLAUSES AND FORMS
352 Solicitation provisions and contract clauses 126
353 Forms....................................... 140
SUBCHAPTER T--HHS SUPPLEMENTATIONS
370 Special programs affecting acquisition...... 143
Attachment I--Single Letter of Credit Recipients and Central
Point Addressees.......................................... 145
Attachment II--HHSAR Subject Index.......................... 152
Appendix A--Public Health Service........................... 159
[[Page 5]]
SUBCHAPTER A_GENERAL
PART 301_HHS ACQUISITION REGULATION SYSTEM
Subpart 301.1_Purpose, Authority, Issuance
Sec.
Sec. 301.101 Purpose.
Sec. 301.102 Authority.
Sec. 301.103 Applicability.
Sec. 301.104 Issuance.
Sec. 301.104-1 Publication and code arrangement.
Sec. 301.104-2 Arrangement of regulations.
Sec. 301.104-3 Copies.
Sec. 301.105 OMB approval under the Paperwork Reduction Act.
Subpart 301.2_Administration
Sec. 301.201 Maintenance of the HHSAR.
Sec. 301.270 Executive Committee for Acquisition.
Sec. 301.271 Timing of HHSAR revisions.
Subpart 301.3_Agency Acquisition Regulations
Sec. 301.301 Policy.
Sec. 301.302 Limitations.
Sec. 301.303 Publication and codification.
Sec. 301.304 Agency control and compliance procedures.
Subpart 301.4_Deviations From the FAR
Sec. 301.403 Individual deviations.
Sec. 301.404 Class deviations.
Sec. 301.470 Procedure.
Subpart 301.5_Agency and Public Participation
Sec. 301.501 Solicitation of agency and public views.
Sec. 301.501-2 Opportunity for public comments.
Sec. 301.501-3 Exceptions.
Sec. 301.503 Public meetings.
Subpart 301.6_Contracting Authority and Responsibility
Sec. 301.602-3 Ratification of unauthorized commitments.
Sec. 301.603 Selection, appointment, and termination of appointment.
Sec. 301.603-1 General.
Sec. 301.603-2 Selection.
Sec. 301.603-3 Appointment.
Sec. 301.603-4 Termination.
Sec. 301.603-70 Delegation of contracting officer responsibilities.
Sec. 301.670 Head of the contracting activity.
Sec. 301.670-1 Responsibility.
Sec. 301.670-2 Designation.
Sec. 301.670-3 Redelegation.
Subpart 301.7_Determinations and Findings
Sec. 301.703 Class determinations and findings.
Sec. 301.704 Content.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13961, Apr. 9, 1984, unless otherwise noted.
Subpart 301.1_Purpose, Authority, Issuance
Sec. 301.101 Purpose.
(a) The Department of Health and Human Services Acquisition
Regulation (HHSAR) is issued to establish uniform acquisition policies
and procedures for the Department of Health and Human Services (HHS)
which conform to the Federal Acquisition Regulation (FAR) System.
(b) The HHSAR implements and supplements the FAR. (Implementing
material expands upon or indicates the manner of compliance with related
FAR material. Supplementing material is new material which has no
counterpart in the FAR.)
(c) The HHSAR contains all formal departmental policies and
procedures that govern the acquisition process or otherwise control
contracting relationships between the Department's contracting offices
and contractors.
Sec. 301.102 Authority.
The HHSAR is prescribed by the Assistant Secretary for Management
and Budget under the authority of 5 U.S.C. 301 and section 205(c) of the
Federal Property and Administrative Services Act of 1949, as amended (40
U.S.C. 486(c)), as delegated by the Secretary. The Assistant Secretary
for Management and Budget has redelegated the authority to establish all
departmental acquisition policy and publish all acquisition regulations
to the Deputy Assistant Secretary for Management and
[[Page 6]]
Acquisition. This authority is not redelegable.
[49 FR 13961, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]
Sec. 301.103 Applicability.
The FAR and HHSAR apply to all HHS acquisitions as stated in FAR
1.103. Unless specified otherwise, these regulations apply to
acquisitions within and outside the United States.
Sec. 301.104 Issuance.
Sec. 301.104-1 Publication and code arrangement.
(a) The HHSAR is also published in the same forms as indicated in
FAR 1.104-1(a).
(b) The HHSAR is issued in the Code of Federal Regulations (CFR) as
Chapter 3 of Title 48, Department of Health and Human Services
Acquisition Regulation. It may be referenced as ``48 CFR Chapter 3.''
Sec. 301.104-2 Arrangement of regulations.
(a) General. The HHSAR conforms to the FAR with respect to
divisional arrangements; i.e., subchapters, parts, subparts, sections,
subsections, and paragraphs.
(b) Numbering. The FAR System of numbering permits the keying of the
same or similar subject matter throughout Chapters 1 (FAR) and 3
(HHSAR). However, unlike the FAR numbering scheme, our scheme varies
somewhat in the numbering to the left of the decimal point. Whereas the
FAR only identifies the part number to the left of the decimal point,
our corresponding reference identifies the chapter as well. For example,
this corresponding paragraph in the FAR is numbered 1.104-2(b) where
``1'' is the part number (may be one or two digits and is followed by a
decimal point), ``1'' (to the right of the decimal point) is the subpart
number, ``04'' (always two digits) is the section number, ``2'' is the
subsection number (always hyphenated), and ``(b)'' is the paragraph
reference. The corresponding HHSAR reference is 301.104-2(b) where the
``3'' or first digit is the chapter number assigned to the particular
department or agency (may be two digits) and the ``01'' represents the
part number (part numbers will always be two digits for agencies
implementing the FAR). The remaining numbers are identical to and
represent the same divisions as the FAR example.
(c) References and citations. (1) Unless otherwise stated,
references, indicate parts, subparts, sections, subsections, etc, of
this regulation, the HHSAR.
(2) This regulation shall be referred to as the Department of Health
and Human Services Acquisition Regulation (HHSAR). Any reference may be
cited as ``HHSAR'' followed by the appropriate number. Within the HHSAR,
the number alone will be used.
(3) Citations of authority shall be incorporated where necessary.
All FAR reference numbers shall be preceded by ``FAR''.
Sec. 301.104-3 Copies.
Copies of the HHSAR in Federal Register and CFR form may be
purchased by the public from the Superintendent of Documents, Government
Printing Office (GPO), Washington, DC 20402. Lose-leaf copies of the
HHSAR may be obtained by departmental personnel having a need for the
document by placing an order with a Directives Distribution Coordinator
in accordance with General Administration Manual Chapter 1-00, HHS Staff
Manual System.
Sec. 301.105 OMB approval under the Paperwork Reduction Act.
The following OMB control numbers apply to the information
collection and recordkeeping requirements contained in this regulation:
------------------------------------------------------------------------
OMB control
HHSAR segment no.
------------------------------------------------------------------------
315.4...................................................... 0990-0139
324.70..................................................... 0990-0136
332.406.................................................... 0990-0134
342.7103................................................... 0990-0131
352.215-71................................................. 0990-0139
352.216-70................................................. 0990-0138
352.224-70................................................. 0990-0136
352.228-70................................................. 0990-0135
352.232-71................................................. 0990-0134
352.232-73................................................. 0990-0134
352.233-70................................................. 0990-0133
352.270-1.................................................. 0990-0129
352.270-2.................................................. 0990-0129
352.270-3.................................................. 0990-0129
352.270-5.................................................. 0990-0130
370.1...................................................... 0990-0129
370.2...................................................... 0990-0129
------------------------------------------------------------------------
[[Page 7]]
The OMB control number ``OMB No. 0990-0115'' is to be included in the
upper right corner of the first page of all solicitations, purchase
orders, and contracts issued by departmental contracting activities. The
number represents approval of the HHS acquisition process and covers
recordkeeping and reporting requirements which are unique to individual
acquisitions (e.g., requirements contained in specifications, statements
of work, etc.).
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 51 FR 44293, Dec. 9, 1986; 53 FR 15562, May 2,
1988]
Subpart 301.2_Administration
Sec. 301.201 Maintenance of the HHSAR.
(a) The HHSAR is prepared and issued under the authority of the
Deputy Assistant Secretary for Management and Acquisition. Acquisition
policies and procedures which are necessary to implement, supplement, or
deviate from the FAR will be issued in the HHSAR by the Deputy Assistant
Secretary for Management and Acquisition when necessary to accomplish
Department-wide acquisition objectives.
(b) The HHSAR is maintained by the Office of Acquisition and Grants
Management. The Director, Office of Acquisition and Grants Management is
responsible for developing and preparing for issuance all acquisition
regulatory material to be included in the HHSAR.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]
Sec. 301.270 Executive Committee for Acquisition.
(a) The Deputy Assistant Secretary for Management and Acquisition
has established the Executive Committee for Acquisition (ECA) to assist
and facilitate the planning and development of departmental acquisition
policies and procedures and to assist in responding to other agencies
and organizations concerning policies and procedures impacting the
Federal acquisition process.
(b) The ECA consists of members and alternates from the Office of
Acquisition and Grants Management, Division of Contract Operations-OS,
Office of Human Development Services, Health Care Financing
Administration, Social Security Administration, Public Health Service,
and, collectively, the regional offices. The ECA is chaired by the
Director, Office of Acquisition and Grants Management. All meetings will
be held at the call of the Chairman, and all activities will be carried
out under the direction of the Chairman.
(c) The ECA, to facilitate the planning, development, and
coordination of government-wide and department-wide acquisition policies
and procedures, is to:
(1) Advise and assist the Chairman concerning major acquisition
policy matters;
(2) Review and appraise, at appropriate intervals, the overall
effectiveness of existing policies and procedures; and
(3) Review and appraise the impact of new major acquisition
policies, procedures, regulations, and developments on current
acquisition policies and procedures.
(d) The Chairman will periodically issue a list of current members
and alternates specifying the name, title, organization, address, and
telephone number of each. The member organizations are responsible for
apprising the Chairman whenever a new member or alternate is to be
appointed to the ECA.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]
Sec. 301.271 Timing of HHSAR revisions.
HHSAR revisions will be issued throughout the year as the need
arises. HHSAR material shall become effective on the date cited in the
Federal Register issuance or on the date of the transmittal notice which
distributes it to HHSAR Staff Manual holders, unless otherwise
indicated.
Subpart 301.3_Agency Acquisition Regulations
Sec. 301.301 Policy.
(a)(1) The FAR and HHSAR are intended to provide all necessary
regulatory guidance for the conduct of the
[[Page 8]]
acquisition process within the Department. However, there may be some
rare instances where regulations are necessary to implement and/or
supplement the FAR and/or HHSAR at the Operating Division (OPDIV) level
or lower. The Department discourages the proliferation of OPDIV and
lower level issuances, but will allow lower level issuances when deemed
pertinent.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 301.302 Limitations.
The same limitations applicable to the FAR also apply to the HHSAR.
Sec. 301.303 Publication and codification.
(a) The HHSAR shall be codified in Chapter 3 of Title 48, Code of
Federal Regulations. Any OPDIV or lower implementation or
supplementation of the HHSAR or FAR shall also be codified as part of
Chapter 3. Implementing material is that which expands upon or indicates
the manner of compliance with related higher level material.
Supplementing material is that for which there is no counterpart. Where
material in the FAR requires no implementation, there will be no
corresponding number in the HHSAR. Thus, there are gaps in the HHSAR
sequence of numbers where the FAR, as written, is deemed adequate.
Supplementary material shall be numbered as specified in FAR 1.303.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 301.304 Agency control and compliance procedures.
(a) Whenever an OPDIV or lower level organization determines a need
for an acquisition regulation not covered by the FAR or HHSAR or wishes
to implement or supplement the coverage in either, the organization
shall prepare a memorandum that explains the need, background,
justification, and significant aspects of the proposed regulation and
send it, together with an outline, to the Director, Office of
Acquisition and Grants Management. The Director will analyze the request
to determine if it has applicability to the HHSAR or FAR; if not, the
Director will either approve or disapprove the request for incorporation
into the organization's acquisition regulation. If the request is
approved, the organization must prepare the proposed regulation in
Federal Register format, obtain all necessary concurrences, including
Office of General Counsel--Business and Administrative Law Division, and
send it to the Director, Office of Acquisition and Grants Management for
review and approval. The regulation must be prepared for signature by
the Deputy Assistant Secretary for Management and Acquisition. All
regulations will be required to be processed through the public
rulemaking process in the Federal Register.
(b) Only the organizations listed in paragraph (d) are authorized to
established acquisition regulations. As of the date of issuance of the
HHSAR, no acquisition regulations below the HHSAR level exist, and the
procedures detailed in paragraph (a) must be followed to initiate the
establishment of an OPDIV or lower level regulation.
(c) Under no circumstances shall any organization's implementation
or supplementation of the FAR or HHSAR conflict with, supersede, or
repeat, paraphrase, or otherwise restate policies or procedures
prescribed by these regulatory issuances. OPDIV or lower level material
shall follow the numbering system, format, and arrangement of the FAR
and HHSAR and will be applicable only within the organization issuing
it. One copy of all OPDIV or lower level material issued in loose-leaf
format shall be furnished the Director, Office of Acquisition and Grants
Management at the times of issuance.
(d) Material issued by OPDIV or lower level organizations to
implement and supplement the HHSAR and FAR shall be identified by
prefixes to the digit 3 (indicating Chapter 3-HHSAR) as follows, and
shall use the same numbering system as the HHSAR:
------------------------------------------------------------------------
Organization Prefix
------------------------------------------------------------------------
Office of the Secretary.................... OS
Health Care Financing Administration....... HCFA
Office of Human Development Services....... OHDS
Public Health Service...................... PHS
Alcohol, Drug Abuse, and Mental Health ADAMHA
Administration.
Centers for Disease Control.............. CDC
Food and Drug Administration............. FDA
[[Page 9]]
Health Resources and Services HRSA
Administration.
Indian Health Service.................... IHS
National Institutes of Health............ NIH
Social Security Administration............. SSA
------------------------------------------------------------------------
Each OPDIV or lower level acquisition regulation will be included in its
entirety as a separate appendix to 48 CFR Chapter 3. The Director,
Office of Acquisition and Grants Management will assign the appendix
designation upon approval of the initial request to establish the OPDIV
or lower level acquisition regulation.
[49 FR 13961, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984;
50 FR 23126, May 31, 1985; 50 FR 38004, Sept. 19, 1985; 53 FR 43206,
Oct. 26, 1988, 54 FR 24342, June 7, 1989]
Subpart 301.4_Deviations From the FAR
Sec. 301.403 Individual deviations.
Requests for individual deviations to either the FAR or HHSAR shall
be prepared in accordance with 301.470 and forwarded through
administrative channels to the Director, Office of Acquisition and
Grants Management for review and approval.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]
Sec. 301.404 Class deviations.
Requests for class deviations to either the FAR or HHSAR shall be
prepared in accordance with 301.470 and forwarded through administrative
channels to the Deputy Assistant Secretary for Management and
Acquisition for review and approval.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]
Sec. 301.470 Procedure.
(a) When a contracting activity or contracting office determines
that a deviation is needed, it shall prepare a deviation request in
memorandum form and forward it through administrative channels to the
official designated as stated in 301.403 or 301.404. In an exigency
situation, the contracting activity or contracting office may request a
deviation verbally, but is required to confirm the request in writing as
soon as possible.
(b) A deviation request shall clearly and precisely set forth the:
(1) Nature of the needed deviation;
(2) Identification of the FAR or HHSAR from which the deviation is
needed;
(3) Circumstances under which the deviation would be used;
(4) Intended effect of the deviation;
(5) Time-frame; and
(6) Reasons which will contribute to complete understanding and
support of the requested deviation. A copy of pertinent background
papers such as a form or contractor's request should accompany the
deviation request.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]
Subpart 301.5_Agency and Public Participation
Sec. 301.501 Solicitation of agency and public views.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 301.501-2 Opportunity for public comments.
(b) Public opportunity for comment on proposed changes or additions
to the HHSAR or lower level acquisition regulations will be offered
whenever the proposed regulation will have an impact on the public and/
or contractors. This will be accomplished by publishing a notice of
proposed rulemaking in the Federal Register which will include the
proposed language and the background and rationale for the proposed
regulation. Comments will not be solicited directly from professional or
industry associations or other interested parties; they will be expected
to respond based upon the Federal Register notification. Normally, the
public will be given 45 days to comment. Proposed changes or additions
to the HHSAR or FAR shall be staffed to the Executive Committee
[[Page 10]]
for Acquisition in accordance with 301.270.
[49 FR 13961, Apr. 9, 1984. Redesignated and amended at 50 FR 23126, May
31, 1985; 50 FR 38004, Sept. 19, 1985]
Sec. 301.501-3 Exceptions.
(e) Comments will not be solicited from the public when the change
or addition to the HHSAR or lower level acquisition regulation is deemed
procedural in nature and concerns internal administrative directions
aimed at departmental personnel (see FAR 1.301(b)).
[49 FR 13961, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984.
Redesignated and amended at 50 FR 23126, May 31, 1985; 50 FR 38004,
Sept. 19, 1985]
Sec. 301.503 Public meetings.
Public meetings will not normally be used to solicit comments or
views on HHSAR or lower level acquisition regulations. However, when the
topic is so controversial that the Department or OPDIV believes a public
meeting would be beneficial, public meetings will be convened.
[49 FR 13961, Apr. 9, 1984. Redesignated at 50 FR 23127, May 31, 1985;
50 FR 38004, Sept. 19, 1985]
Subpart 301.6_Contracting Authority and Responsibility
Source: 53 FR 15562, May 2, 1988, unless otherwise noted.
Sec. 301.602-3 Ratification of unauthorized commitments.
(b) Policy. (1) The Government is not bound by agreements or
contractual commitments made to prospective contractors by persons to
whom contracting authority has not been delegated. However, execution of
otherwise proper contracts made by individuals without contracting
authority, or by contracting officers in excess of the limits of their
delegated authority, may be later ratified. The ratification must be in
the form of a written document clearly stating that ratification of a
previously unauthorized act is intended and must be signed by the head
of the contracting activity (HCA).
(2) The HCA or his/her designee is the official authorized to ratify
an unauthorized commitment (but see (b)(3), below).
(3) Ratification authority may be redelegated by the HCA, but not
below the level of the principal official responsible for acquisition
(PORA).
(c) Limitations. (5) The concurrence of legal counsel concerning the
payment issue is optional.
(7) The ratification shall be in written document form containing
verification of each limitation stated in FAR 1.602-3(c)(1)-(6), and
shall be processed in accordance with 301.602-3(e) Procedures.
(e) Procedures. (1) The individual who made the unauthorized
contractual commitment shall furnish the reviewing contracting officer
all records and documents concerning the commitment and a complete
written statement of facts, including, but not limited to: a statement
as to why the contracting office was not used, a statement as to why the
proposed contractor was selected, a list of other sources considered, a
description of work to be performed or products to be furnished, the
estimated or agreed contract price, a citation of the appropriation
available, and a statement of whether the contractor has commenced
performance.
(2) The contracting officer will review the submitted material, and
prepare the ratification document if he/she determines that the
commitment may be ratifiable. The contracting officer shall forward the
ratification document and the submitted material to the HCA or designee
with any comments or information which should be considered in
evaluation of the request for ratification. If legal review is
desirable, the HCA or designee will coordinate the request for
ratification with the Office of General Counsel, Business and
Administrative Law Division.
(3) If ratification is authorized by the HCA or designee, the file
will be returned, along with the ratification document, to the
contracting officer for issuance of a purchase order or contract, as
appropriate.
(4) HCA's or their designees will report the number and dollar value
of requests for ratifications received and
[[Page 11]]
ratifications authorized each calendar quarter. Reports shall be
submitted in an original and one copy to the Deputy Assistant Secretary
for Management and Acquisition to arrive no later than 30 calendar days
after the close of each calendar quarter.
[53 FR 43206, Oct. 26, 1988]
Sec. 301.603 Selection, appointment, and termination of appointment.
Sec. 301.603-1 General.
(a) The appointment and termination of appointment of contracting
officers shall be made by the principal official responsible for
acquisition (PORA). This authority is not delegable. The head of the
contracting activity shall ensure that only the PORA is redelegated, and
exercises, this authority.
(b) Only GS-1105 and 1106 and GS/GM-1101 and 1102 personnel shall be
appointed as contracting officers (see 301.603-3(b)).
(c) The appointment of contracting officers shall be made at one of
the four levels specified under the HHS Acquisition Certification
Program (see 301.603-3(b)).
(d) An individual shall be appointed only in instances where a valid
organizational need for a contracting officer can be demonstrated or a
replacement position is to be filled. Factors to be considered in
assessing the need for a contracting officer appointment include volume
of actions, complexity of work, and structure of the organization.
Sec. 301.603-2 Selection.
(a) When an organizational need for a contracting officer is
determined or a replacement is required, an official (usually the
prospective contracting officer's immediate supervisor) will nominate a
contracting officer candidate. The nomination shall be accompanied by
the candidate's current Standard Form (SF) 171, Personal Qualifications
Statement, that contains all relevant information, to include that
stated in FAR 1.603-2, a copy of the nominee's most recent performance
appraisal, and a copy of the certificate issued under the HHS
Acquisition Certification Program indicating the current level of
certification.
(b) The PORA shall review the submitted material to determine the
candidate's ability to perform the contracting functions required to
meet the organizational need. If the PORA requires additional
information to make the decision, it shall be provided expeditiously by
the nominating official.
Sec. 1.603-3 Appointment.
(a) Contracting officer appointments shall become effective when the
PORA signs the Standard Form 1402, Certificate of Appointment. SF 1402's
shall be prepared and maintained in accordance with FAR 1.603-3.
(b) Appointments shall be made at one of the four levels established
by the HHS Acquisition Certification Program. Therefore, the contracting
officer candidate must meet the minimum eligibility requirements of
certification for one of the four stated levels. The level will be
determined by the organizational need or position being refilled
(replacement). The four levels are as follows:
(1) Level I--Purchasing Agent. Mandatory for all personnel who have
signature authority for small purchases (GS-1102, 1105, and 1106),
including orders from GSA sources.
(2) Level II--Acquisition Official. Mandatory for those in the GS-
1102 series. Sufficient for delegation of contracting officer authority
to a maximum of $100,000.
(3) Level III--Senior Acquisition Official. Mandatory for those in
the GS-1102 series for delegation of contracting officer authority above
$100,000.
(4) Level IV--Acquisition Manager. Mandatory for preaward review and
approval authority as specified in HHSAR Subpart 304.71.
(c) Changes to contracting officer appointments, either increasing
or decreasing the warrant limitations, shall be made by the PORA.
Changes must be made from one of the four certification levels to
another, or within one of the certification levels, and must be
implemented by the PORA's issuance of a new SF 1402 to replace the
existing SF 1402.
(d) Personnel shall not ordinarily be appointed as contracting
officers if they do not meet the qualifications
[[Page 12]]
prescribed for one of the four certification levels. However, if it is
essential to appoint a contracting officer who does not fully meet the
certification qualifications, an interim appointment may be granted by
the PORA. The PORA shall require as a condition of the interim
appointment that all training or experience requirements be met within a
six month time period. Usually, interim appointments shall not exceed
six months. Failure to successfully complete the necessary training
requirements or gain the experience within this time frame will result
in termination of the appointment, unless the PORA determines that
unusual circumstances prevented the attainment of either. In this
instance, one additional six month interim appointment may be issued,
but no more shall be allowed. The PORA shall fully document all interim
appointment actions.
(e) The original SF 1402 shall be provided to the contracting
officer, and a copy shall be retained by the PORA. Another copy of the
SF 1402 along with the SF 171 material shall be forwarded to the
servicing personnel office for inclusion in the individual's personnel
file folder. Files on individuals should not be established by the PORA.
Sec. 301.603-4 Termination.
Termination of contracting officer appointments shall be executed by
the PORA in accordance with FAR 1.603-4.
Sec. 301.603-70 Delegation of contracting officer responsibilities.
(a) Non-GS/GM-1101 or 1102 or GS-1105 or 1106 personnel shall only
be delegated contracting officer responsibilities when determined
necessary by a warranted contracting officer (holder of a valid SF
1402), and in accordance with this subsection. Personnel, such as a
contracting officer's representative or an ordering officer, shall be
delegated only the needed responsibilities by the warranted contracting
officer in a written memorandum of delegation which clearly states any
limitations on the delegation. Personnel who are not in the GS/GM-1101
or 1102 or GS-1105 or 1106 job series shall not be issued a SF 1402,
Certificate of Appointment.
(b) Non-acquisition personnel who are delegated acquisition
responsibilities shall be required to have the training, experience, and
education requirements necessary for the responsibilities assigned. If,
for example, responsibility is to be delegated for making small
purchases, the training, education, and experience for Level I--
Purchasing Agent, or its equivalent as determined by the PORA, shall be
required.
Sec. 301.670 Head of the contracting activity.
Sec. 301.670-1 Responsibility.
The head of the contracting activity (HCA) is responsible for
conducting an effective and efficient acquisition program. Adequate
controls shall be established to assure compliance with applicable laws,
regulations, procedures, and the dictates of good management practices.
Periodic reviews shall be conducted by qualified personnel, preferably
assigned to positions other than in the contracting office being
reviewed, to determine the extent of adherence to prescribed policies
and regulations, and to detect a need for guidance and/or training.
Sec. 301.670-2 Designation.
Each OPDIV head and PHS agency head has been designated as HCA along
with the following officials:
(a) Deputy Assistant Secretary for Management and Acquisition; and
(b) Each Regional Director.
[53 FR 15562, May 2, 1988, as amended at 54 FR 24342, June 7, 1989]
Sec. 301.670-3 Redelegation.
(a) The heads of contracting activities may redelegate their HCA
authorities to the extent that redelegation is not prohibited by the
terms of their respective delegations of authority, by law, by the
Federal Acquisition Regulation, by the HHS Acquisition Regulation, or by
other regulations. However, HCA and other contracting approvals and
authorities shall not be redelegated below the levels specified in the
HHS Acquisition Regulation or, in the
[[Page 13]]
absence of coverage in the HHS Acquisition Regulation, the Federal
Acquisition Regulation. To ensure proper control of redelegated
acquisition authorities, HCA's shall maintain a file containing
successive delegations of HCA authority through and including the
contracting officer level.
(b) Personnel delegated responsibility for acquisition functions
must possess a level of experience, training, and ability commensurate
with the complexity and magnitude of the acquisition actions involved.
Subpart 301.7_Determinations and Findings
Source: 50 FR 23127, May 31, 1985 (interim rule) and 50 FR 38004,
Sept. 19, 1985 (final rule), unless otherwise noted.
Sec. 301.703 Class determinations and findings.
(b) All class determinations and findings (D&F's) shall be limited
to a period of one year or less.
Sec. 301.704 Content.
An example of a D&F format may be found in 316.301-3(c). All D&F's
shall be prepared using the referenced format and shall include the
information required by FAR 1.704(a)-(g).
PART 302_DEFINITIONS OF WORDS AND TERMS
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Subpart 302.1_Definitions
Sec. 302.100 Definitions of terms.
Chief of the contracting office (CCO) is a mid-level management
official in charge of a contracting office who controls and oversees the
daily contracting operation of an Operating Division (OPDIV) or major
component of an OPDIV. The CCO is subordinate to the principal official
responsible for acquisition and is located at a management level above
other contracting personnel, usually as a branch chief.
Head of the agency or agency head means the head of the Operating
Division (OPDIV) for HCFA, OHDS, PHS, and SSA, or the Assistant
Secretary for Management and Budget (ASMB) for the Office of the
Secretary (OS).
Head of the contracting activity (HCA)--see 301.670-2.
Principal official responsible for acquisition (PORA) is defined in
terms of certain organizational positions within the Office of
Management and Acquisition (OMAC-OS), Health Care Financing
Administration (HCFA), Office of Human Development Services (OHDS),
Office of the Assistant Secretary for Health (OASH), Alcohol, Drug
Abuse, and Mental Health Administration (ADAMHA), Centers for Disease
Control (CDC), Food and Drug Administration (FDA), Health Resources and
Services Administration (HRSA), Indian Health Service (IHS), National
Institutes of Health (NIH), Social Security Administration (SSA), and
the Regional Offices (RO's), as follows:
OMAC-OS--Director, Division of Contract Operations
HCFA--Director, Office of Acquisition and Grants, Office of Budget and
Administration
OHDS-- Director, Grants and Contracts Management Division, Office of
Management Services
OASH--Director, Division of Acquisitions Management, Administrative
Services Center, Office of Management
ADAMHA-- Director, Division of Grants and Contracts Management, Office
of the Administrator
CDC-- Director, Procurement and Grants Office, Office of the Center
Director
FDA-- Director, Division of Contracts and Grants Management, Office of
the Associate Commissioner for Management and Operations
HRSA-- Director, Division of Grants and Procurement Management, Office
of Management
IHS-- Director, Division of Contracts and Grants Policy, Office of
Administration and Management
NIH-- Director, Division of Contracts and Grants, Office of
Administration
SSA-- Associate Commissioner, Office of Acquisition and Grants
RO's-- Director, Regional Administrative Support Center
The PORA is subordinate to the head of the contracting activity and is
the official in charge of the major contracting operation activity
within the
[[Page 14]]
OPDIV, agency, staff office, or regional office.
[49 FR 13964, Apr. 9, 1984, as amended at 51 FR 23231, June 26, 1986; 51
FR 44293, Dec. 9, 1986; 52 FR 27558, July 22, 1987; 53 FR 43207, Oct.
26, 1988; 54 FR 24342, June 7, 1989; 55 FR 13536, Apr. 11, 1990; 56 FR
47002, Sept. 17, 1991]
PART 303_IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST
Subpart 303.1_Safeguards
Sec.
Sec. 303.101 Standards of conduct.
Sec. 303.101-3 Agency regulations.
Sec. 303.104 Procurement integrity.
Sec. 303.104-4 Definitions.
Sec. 303.104-5 Disclosure of proprietary and source selection
information.
Sec. 303.104-6 Restrictions on Government officials, employees, and
consultants.
Sec. 303.104-9 Certification requirements.
Sec. 303.104-11 Processing violations or possible violations.
Sec. 303.104-12 Ethics program training requirements.
Subpart 303.2_Contract Gratuities to Government Personnel
Sec. 303.203 Reporting suspected violations of the Gratuities clause.
Subpart 303.3_Report of Suspected Antitrust Violations
Sec. 303.303 Reporting suspected antitrust violations.
Subpart 303.4_Contingent Fees
Sec. 303.408 Evaluation of the SF 119.
Sec. 303.408-1 Responsibilities.
Sec. 303.409 Misrepresentations or violations of the Covenant Against
Contingent Fees.
Subpart 303.5_Other Improper Business Practices
Sec. 303.502 Subcontractor kickbacks.
Subpart 303.6_Contracts With Government Employees or Organizations Owned
or Controlled by Them
Sec. 303.602 Exceptions.
Subpart 303.7_Voiding and Rescinding Contracts
Sec. 303.704 Policy.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13964, Apr. 9, 1984, unless otherwise noted.
Subpart 303.1_Safeguards
Source: 54 FR 31528, July 31, 1989, unless otherwise noted.
Sec. 303.101 Standards of conduct.
Sec. 303.101-3 Agency regulations.
The Department of Health and Human Services' Standards of Conduct
are prescribed in Part 73 of Title 45.
Sec. 303.104 Procurement integrity.
Sec. 303.104-4 Definitions.
(h)(1) Procurement official means any individual who has
participated personally and substantially in the conduct of a
procurement. The following classes of employees may be considered
procurement officials depending on the circumstances prevailing in a
given case: contracting officers, contract specialists, contract
administrators, procurement agents, procurement clerks, cost/price
analysts, procurement analysts, clerical support and administrative
personnel, auditors, professional staff of the Division of Cost
Allocation, acquisition review and approval officials, contract
clearance staff, board of award members, supervisory procurement
officials, small and disadvantaged business utilization specialists,
project officers, project managers, program officials, officials who
provide special program clearances and approvals, program managers,
technical evaluation panelists, peer reviewers, source selection
evaluation board members, source selection advisory council members,
source selection authorities, finance officials, and procurement
lawyers. Concept peer reviewers are not considered to be procurement
officials when participating in project concept reviews pursuant to 42
CFR 52h.10(a). However, concept peer reviewers, or other peer reviewers,
who participate in a project approach review are procurement officials.
When there is a question whether an individual is a procurement
official, the activities of the individual should be analyzed by the
contracting officer to determine
[[Page 15]]
whether there is both personal and substantial involvement in a
procurement. If there is doubt in a particular case, the doubt should be
resolved by including the individual as a procurement official. The
contracting officer has the authority to decide who is or who is not a
procurement official in a particular case. The opinion of the Office of
the General Counsel (OGC) should be requested when the contracting
officer believes the situation is particularly complex or sensitive.
When the contracting officer's decision is disputed by the individual
whose status as a procurement official is in question, the matter will
be referred to the Principal Official Responsible for Acquisition (PORA)
for a final determination.
(k)(1) Source selection information includes ``derivative
documents'' which are documents containing references to or directly
citing or paraphrasing proprietary or source selection information.
Sec. 303.104-5 Disclosure of proprietary and source selection
information.
(a) The contracting officer or any other individual who prepares,
makes or controls proprietary, source selection information, or
derivative documents shall--
(1) Ensure documents are marked as prescribed in FAR 3.104-4 (j) and
(k);
(2) Provide physical security for documents in the office
environment during and after duty hours; and
(3) Ensure security of interoffice mailing of documents by using
opaque envelopes, double wrapping with more than one envelope, and
sealing of envelopes, as necessary.
(b) Individuals responsible for preparing derivative documents are
responsible for marking such documents in accordance with FAR 3.104-
5(b).
(c) Only the contracting officer has the authority to authorize
individuals, or classes of individuals, access to proprietary or source
selection information for each procurement except for paragraph (d) of
this section.
(d) The following classes of individuals are authorized blanket
access to only that source selection information developed before a
request for contract is sent to the contract office, or to later
modifications or supplements to such information--
(1) The generators of the requirements, including program,
scientific, and technical experts involved in the development of the
statements of work, specifications, evaluation plans, budget estimates,
or similar documents;
(2) Reviewing officials; and
(3) Supervisors in the management chain of the individuals listed in
paragraphs (d) (1) and (2) of this section. The contracting officer
shall include in the contract file names and functions of any other
individuals authorized access to proprietary or source selection
information.
Sec. 303.104-6 Restrictions on Government officials, employees, and
consultants.
(b) Procurement officials leaving the Department will be required to
complete the certification set forth in Chapter 1-90 of the General
Administration Manual if that official leaves the Department during the
conduct of a procurement expected to result in a contract or
modification in excess of $100,000. The administrative officer will
forward a copy of the certification to each responsible contracting
officer for incorporation into the contract file.
Sec. 303.104-9 Certification requirements.
(c) The contracting officer shall include the contracting officer
certification in the contract file for each contract action over
$100,000. Including the certificate in the contract file shall be
considered notification to the head of the agency.
(e)(2) The waiver shall be submitted to the Office of Acquisition
and Grants Management in the Office of Management and Acquisition,
Office of Management and Budget in the Office of the Secretary for
review and approval before submission to the head of the agency.
Sec. 303.104-11 Processing violations or possible violations.
(a)(1) The contracting officer determination that a reported
violation or possible violation of the statutory prohibitions has no
impact on the impending award or selection of a source must
[[Page 16]]
be submitted through channels, along with supporting documentation, to
the PORA for review and approval of the determination before award of a
contract.
(2) The contracting officer's determination that a reported
violation or possible violation of the statutory prohibitions has an
impact on the pending award or selection of a source must be referred
through channels, along with all related information available, to the
PORA (if the PORA is an SES) or to another SES official designated by
the OPDIV. That individual will--
(i) Refer the matter immediately to the Office of Acquisition and
Grants Management in the Office of Management and Acquisition, Office of
Management and Budget, Office of the Secretary for review, which office
may consult with the Office of the General Counsel and the Office of the
Inspector General, as appropriate; and
(ii) Determine the action to be taken on the procurement in
accordance with FAR 3.104-11 (c) and (d).
(b) The individual in paragraph (a)(2) of this section acts as the
agency head designee with respect to actions taken under the FAR clause
at 52.203-10, Remedies for Illegal or Improper Activity.
Sec. 303.104-12 Ethics program training requirements.
(a) The Office of Acquisition and Grants Management in the Office of
Management and Acquisition (OAGM), Office of Management and Budget in
the Office of the Secretary is responsible for developing a training
module which can be used by the Department's OPDIVs and Regional offices
to train procurement officials. Upon receipt of the module, each OPDIV
and Regional Office must train the procurement officials set forth in
303.104-4(h)(1) before they can act as procurement officials.
(b) After the training has been completed, each procurement official
must sign the ``Procurement Official's Certificate of Procurement
Integrity'' before he/she can act as a procurement official on any
procurement. The certificate shall be submitted to the servicing
personnel office, where the certificate will be filed on the left side
of the employee's Official Personnel Folder. A copy of the certificate
shall be provided to the contract office which shall maintain a list of
the procurement officials who have signed the certificates.
(c) Procurement officials who serve multiple contracting offices
(such as procurement lawyers) shall submit copies of their certificates
to OAGM with the originals being transmitted to their servicing
personnel office. OAGM shall maintain a list of such procurement
officials and inform cognizant contracting officers upon telephonic
request whether particular individuals are included on the list.
Subpart 303.2_Contractor Gratuities to Government Personnel
Sec. 303.203 Reporting suspected violations of the Gratuities clause.
Departmental personnel shall report suspected violations of the
Gratuities clause in accordance with subpart M, Reporting Violations, of
the Department's Standards of Conduct (45 CFR part 73) and General
Administration Manual Chapter 5-10, rather than as specified in FAR
3.203. Refer to subpart E, Gifts, Entertainment, and Favors, of 45 CFR
part 73 for an explanation regarding what is prohibited and what is
permitted.
Subpart 303.3_Report of Suspected Antitrust Violations
Sec. 303.303 Reporting suspected antitrust violations.
A copy of each report of suspected antitrust violations submitted to
the Attorney General shall also be submitted to the Director, Office of
Acquisition and Grants Management.
[49 FR 13964, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]
Subpart 303.4_Contingent Fees
Sec. 303.408 Evaluation of the SF 119.
Sec. 303.408-1 Responsibilities.
(b) The chief of the contracting office shall perform the review
required by FAR 3.408-1(b) and should consult with the Office of General
Counsel, Business
[[Page 17]]
and Administrative Law Division, when deemed necessary.
Sec. 303.409 Misrepresentations or violations of the Covenant Against
Contingent Fees.
(a) Reports shall be made promptly to the contracting officer.
(b)(1)-(3) [Reserved]
(4) Suspected fraudulent or criminal matters to be reported to the
Department of Justice shall be prepared in letter format and forwarded
through acquisition channels to the head of the contracting activity for
signature. The letter must contain all pertinent facts and background
information considered by the contracting officer and chief of the
contracting office that led to the decision that fraudulent or criminal
matters may be present. A copy of the signed letter shall be sent to the
Director, Office of Acquisition and Grants Management.
[49 FR 13964, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]
Subpart 303.5_Other Improper Business Practices
Sec. 303.502 Subcontractor kickbacks.
(b) Any known or suspected violations of the Anti-Kickback Act (41
U.S.C. 51-54) shall be reported to the contracting officer who shall
investigate the matter, document the findings, and report the results to
the chief of the contracting office. If the results substantiate the
known or suspected violation, the chief of the contracting office shall
notify the Office of General Counsel, Business and Administrative Law
Division and report the matter, through acquisition channels, to the
head of the contracting activity. The head of the contracting activity
shall take appropriate action is consonance with the Act, and notify the
Director, Office of Acquisition and Grants Management of the case and
its disposition.
[49 FR 13964, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989]
Subpart 303.6_Contracts With Government Employees or Organizations Owned
or Controlled by Them
Sec. 303.602 Exceptions.
Approval of an exception to the policy stated in FAR 3.601 shall be
made by the head of the OPDIV (Assistant Secretary for Management and
Budget in OS cases) or the Regional Director.
Subpart 303.7_Voiding and Rescinding Contracts
Sec. 303.704 Policy.
For the purposes of implementing FAR subpart 3.7, the authorities
granted to the ``agency head or designee'' shall be exercised by the
principal official responsible for acquisition.
[51 FR 44293, Dec. 9, 1986]
PART 304_ADMINISTRATIVE MATTERS
Subpart 304.1_Contract Execution
Sec.
Sec. 304.101 Contracting officer's signature.
Sec. 304.170 [Reserved]
Subpart 304.2_Contract Distribution
Sec. 304.201 Procedures.
Subpart 304.6_Contract Reporting
Sec. 304.602 Federal Procurement Data System.
Subpart 304.8_Contract Files
Sec. 304.801 General.
Sec. 304.804 Closeout of contract files.
Sec. 304.804-1 Closeout by the office administering the contract.
Sec. 304.870 Closing review.
Subpart 304.70_Acquisition Instrument Identification Numbering System
Sec. 304.7000 Scope of subpart.
Sec. 304.7001 Numbering contracts.
Sec. 304.7002 Numbering solicitation documents.
Sec. 304.7003 Numbering purchase and delivery orders.
Sec. 304.7004 Numbering basic agreements.
[[Page 18]]
Sec. 304.7005 Numbering basic ordering agreements.
Subpart 304.71_Review and Approval of Proposed Contract Awards
Sec. 304.7100 Scope of subpart.
Sec. 304.7101 Contracts requiring review and approval.
Sec. 304.7102 Conduct of the review.
Sec. 304.7103 Approvals.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13965, Apr. 9, 1984, unless otherwise noted.
Subpart 304.1_Contract Execution
Sec. 304.101 Contracting officer's signature.
An original of each bilateral contract or modification shall be
executed by the contractor and contracting officer. An original of each
unilateral contract or modification shall be executed by the contracting
officer. The contracting officer need only sign the original when carbon
paper is used in sets of forms such as Standard Form 44 or Optional Form
347 or 348. A legible carbon impression of the contracting officer's
signature shall carry the same force and effect as a pen and ink
signature for unilateral contracts.
Sec. 304.170 [Reserved]
Subpart 304.2_Contract Distribution
Sec. 304.201 Procedures.
The signed original of bilateral contracts and modifications shall
be placed in the contract file, and duplicate originals shall be
furnished the contractor, the appropriate accounting point, the project
officer, and other individuals or offices, as applicable. Purchase
orders, delivery orders, and other unilateral contracts and
modifications shall be distributed the same as bilateral contracts
except the original shall be furnished the contractor or seller. Copies
of unilateral contracts and modifications with carbon impressioned
signatures may be used but must be stamped ``DUPLICATE ORIGINAL'' (see
304.101).
[49 FR 36110, Sept. 14, 1984]
Subpart 304.6_Contract Reporting
Sec. 304.602 Federal Procurement Data System.
The Department-wide Contract Information System (DCIS) represents
the Department's implementation of the FPDS. All departmental
contracting activities are required to participate in the DCIS and
follow the procedures stated in the Contract Information System Manual
and amendments to it. The principal official responsible for acquisition
shall ensure that all required contract information is collected,
submitted, and received into the DCIS on or before the 15th of each
month for all appropriate contract and contract modification awards of
the prior month.
[49 FR 13965, Apr. 9, 1984. Redesignated at 51 FR 44293, Dec. 9, 1986]
Subpart 304.8_Contract Files
Sec. 304.801 General.
OPDIVs shall prescribe the contents of contract files and establish
filing procedures consistent with the nature of the contracting actions
and in accordance with FAR 4.801, 4.802, and 4.803. Contract files
should contain an index of the contents to facilitate review and should
be separated into logical categories (see FAR 4.803).
Sec. 304.804 Closeout of contract files.
Sec. 304.804-1 Closeout by the office administering the contract.
(3) Files for all cost-reimbursement type contracts should be closed
within 20 months of the month in which the contracting officer receives
evidence of physical completion (see FAR 4.804-4). The contracting
officer responsible for contract closeout may negotiate settlement of
indirect costs for a specific contract, in advance of the determination
of final indirect cost rates in accordance with FAR 42.708.
Sec. 304.870 Closing review.
(a) Contracting officers shall assure the applicable items in FAR
4.804-5,
[[Page 19]]
other than a field audit, have been accomplished prior to closing any
physically completed contract. Cost-reimbursement type contracts will be
subject to the additional requirements set forth below before they may
be closed.
(b) Contracting officers shall use the instructions in the October
5, 1982 memorandum from the Deputy Assistant Secretary for Procurement,
Assistance and Logistics to closeout cost-reimbursement type contracts
physically completed prior to fiscal year 1977 and cost-reimbursement
type contracts completed subsequent to that date for which field audit
information is available.
(c) Contracting officers shall closeout all other cost-reimbursement
type contracts physically completed after September 30, 1977 in
accordance with the following procedures:
(1) Field audits will be conducted for contracts in excess of
$500,000 awarded to commercial organizations and non-profit
organizations other than colleges and universities, hospitals and State
and local units of government for which an agency other than HHS has
audit cognizance. Field audits will also be conducted each year on
approximately 25 of the same type contractors for which HHS has audit
cognizance. These contracts may be closed after receipt of the field
audit report.
(2) Contracts of any dollar value with non-proprietary colleges and
universities, hospitals and State and local units of government and
contracts not in excess of $500,000 with other institutions/
organizations shall be closed out on the basis of a desk audit. The desk
audit should include (i) a confirmation from the project officer that
labor, material, travel, and other types of direct costs are
commensurate with contract requirements, (ii) a review of available
audit reports to determine if any adjustments were made that may be
applicable to the contract under review, and (iii) discussions with the
cognizant government auditor when considered appropriate. These
contracts shall be closed with the condition that they are subject to
adjustment should an on-site audit be conducted at a later date and
should unallowable costs be identified as a result of that audit. The
release executed by the contractor shall contain the following:
The Contractor agrees, pursuant to the clause in this contract
entitled Allowable Cost (for cost-reimbursement contracts) or Allowable
Cost and Fixed Fee (for CPFF contracts), that the amount of any
sustained audit exceptions resulting from any audit made after final
payment will be refunded to the Government.
(3) The contracting officer may request a field audit of any
contract when, in his/her judgment, the risk attendant with the contract
warrants it. The contracting officer, however, shall exercise discretion
in requesting such audits on creditable evidence such as unsatisfactory
dealings with the contractor during the period of contract performance,
prior audit reports containing serious findings against the contractor,
the known experience of other government officials in dealing with the
contractor when the contracting officer is personally knowledgeable
about the circumstances, formal third party complaints or allegations
which bear upon the contractor's integrity or the propriety of costs
charged to the Government, and other comparable allegations or advice of
a derogatory nature about the contractor made by responsible individuals
which in the contracting officer's judgment should be investigated.
Except where a contracting officer suspects misrepresentation or fraud,
audits should not be requested if their cost of performance is likely to
exceed their potential cost recovery.
(4) When an audit is warranted prior to closing out a contract, the
contracting officer should request the audit directly from the
Department of Health and Human Services Office of the Inspector General,
Office of Audits (HHSOA). The request should cite the reasons the
contracting officer believes an audit is warranted. A copy of the
request should be forwarded to the Director, Office of Acquisition and
Grants Management (DOAGM). In the event the Office of the Inspector
General cannot honor the request in a reasonable period of time, it will
consult with DOAGM and the contracting officer. The final decision on
the need and scope of an audit will be made on the basis of the value of
the contract, the
[[Page 20]]
nature of the contracting officer's concerns, and the availability of
HHSOA or other existing resources in the Department to perform a review
to satisfy the contracting officer's concerns.
(5) Closeout procedures are to be followed in conjunction with the
regular procedures now followed in administering contracts. These
procedures are not meant or to be interpreted as imposing any
requirement or responsibility on contracting officers or necessitating
any reviews on the part of the contracting officials not currently
required by the FAR. With some rare exceptions, Standard Form 1034,
Public Voucher for Purchases and Services Other than Personal, will
contain sufficient information to allow a contracting officer to satisfy
requirements for desk audits. Accordingly, these closeout procedures
shall not cause contracting officers to engage in extraordinary
oversight or review and shall not be used by contracting officers as the
basis for requiring contractors to submit extraordinary documentation
such as payroll listing, labor billings, travel details, etc.
[49 FR 13965, Apr. 9, 1984, as amended at 54 FR 24342, June 7, 1989; 54
FR 43965, Oct. 30, 1989; 56 FR 47002, Sept. 17, 1991]
Subpart 304.70_Acquisition Instrument Identification Numbering System
Sec. 304.7000 Scope of subpart.
This subpart prescribes policy and procedures for assigning
identifying numbers to contracts and related instruments, including
solicitation documents, purchase orders, and delivery orders.
Sec. 304.7001 Numbering contracts.
(a) Contracts which require numbering. The following contracts shall
be numbered in accordance with the system prescribed in paragraph (b) of
this section:
(1) All contracts, including letter contracts and task orders under
basic ordering agreements, which involve the payment of $2,500 or more
for the acquisition of personal property or nonpersonal services.
(2) All contracts which involve the payment of $2,000 or more for
construction (including renovation or alteration).
(3) All contracts which involve more than one payment regardless of
amount.
(The number assigned to a letter contract shall be assigned to the
superseding definitized contract.)
(b) Numbering system. All contracts which require numbering shall be
assigned a number consisting of the following:
(1) The three digit code assigned to the contracting office by the
Office of Financial Operations, Office of Finance.
(2) A two digit fiscal year designation; and
(3) A four digit serial number. While it is required that a
different series of four digit serial numbers be used for each fiscal
year, serial numbers assigned need not be sequential.
(c) Illustration of contract numbers. The initial contract executed
by the Division of Contract Operations, Office of the Secretary, for
fiscal year 1983 should be numbered 100-83-0001, the second contract
100-83-0002. Alternatively, if it is desirable for internal
identification purposes to establish separate series of numbers for
sealed bid and negotiated contracts, this procedure is permissible. In
this instance, the initial sealed bid contract might be numbered 100-83-
0001 and the initial negotiated contract numbered 100-83-0500.
(d) Assignment of identification codes. Each contracting office of
the Department shall be assigned a three digit identification code by
the Office of Financial Operations. Requests for the assignment of such
codes for newly established contracting offices shall be submitted by
the headquarters acquisition staff office of the contracting activity to
the Director, Office of Financial Operations. Conversely, in the event
that a contracting office is to be disestablished, the Director, Office
of Financial Operations shall be notified.
[[Page 21]]
A listing of the contracting office identification codes currently in
use is contained in the Department-wide Contract Information System
Manual (DCIS).
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24342, June 7, 1989]
Sec. 304.7002 Numbering solicitation documents.
Requests for proposals and invitations for bids shall be numbered in
accordance with procedures prescribed by the headquarters staff office
of the contracting activity.
Sec. 304.7003 Numbering purchase and delivery orders.
Contracting offices shall establish procedures for numbering
purchase orders as required for effective identification and control.
Sec. 304.7004 Numbering basic agreements.
Basic agreements shall be numbered in accordance with procedures
prescribed by the headquarters staff office of the cognizant contracting
activity. However, individual contracts entered into pursuant to the
terms and conditions of a basic agreement shall be numbered in
accordance with 304.7001(b).
Sec. 304.7005 Numbering basic ordering agreements.
Basic ordering agreements shall be numbered in accordance with
procedures prescribed by the headquarters staff office of the
contracting activity.
[49 FR 13965, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988]
Subpart 304.71_Review and Approval of Proposed Contract Awards
Sec. 304.7100 Scope of subpart.
This subpart prescribes review and approval procedures for contract
actions to ensure that:
(a) Contract awards are in conformance with law, established
policies and procedures, and sound business practices;
(b) Contractual documents properly reflect the mutual understanding
of the parties; and
(c) The contracting officer is informed of deficiencies and items of
questionable acceptability and corrective action is taken.
Sec. 304.7101 Contracts requiring review and approval.
(a) General. All contractual documents, regardless of dollar value,
are to be reviewed by the contracting officer prior to award, even if
the review and approval procedures prescribed in this section are
applicable. However, under no circumstances may the individual who signs
a contract instrument as contracting officer perform final review and
approval of that contract action if it, or any modification to it, is
expected to exceed the levels set forth in (b) (1) or (2) below.
(b) Required reviews and approvals. (1) Officials responsible for
the acquisition function in the Office of the Secretary, OPDIVs (except
the Public Health Service), and regional offices are to assure that
sealed bid or negotiated contracts, and/or modifications to them,
expected to exceed $300,000, are reviewed and approved prior to award.
In order to assure the propriety of smaller dollar acquisitions, a
statistically significant sample of contract actions not expected to
exceed $300,000 are to be reviewed and approved prior to award.
(2) Contract actions of the Public Health Service are to be reviewed
and approved prior to award in accordance with the dollar thresholds
stated in Subpart PHS 304.71. In order to assure the propriety of
smaller dollar acquisitions, a statistically significant sample of
contract actions not expected to exceed those dollar thresholds
referenced in Subpart PHS 304.71 are to be reviewed and approved prior
to award.
(c) Reviewing officials. Officials assigned responsibility for
review and approval of contract actions must possess qualifications in
the field of acquisition commensurate with the level of review
performed, and, as a minimum, possess those acquisition skills expected
of a contracting officer. The following officials are responsible for
preaward contract review and approval:
Office of the Secretary--
[[Page 22]]
Director, Division of Contract and Grant Operations
Director, Division of Contract Operations, Office of Administrative
and Management Services
Office of Human Development Services--Director, Grants and Contracts
Management Division
Social Security Administration--Director, Office of Acquisition and
Grants (may be redelegated to the appropriate division direction within
the Office of Acquisition and Grants)
Health Care Financing Administration--Director, Division of Procurement
Services.
Public Health Service--The reviewing official is designated in Subpart
PHS 304.71, as approved by the Director, Office of Procurement and
Logistics Policy, OPAL.
However, if any of the officials are to serve as the contracting officer
and sign the contractual document, the review and approval function
shall be performed by an appropriate official at least one level above.
(d) Regional offices. The Director, Regional Administrative Support
Center (RASC) is responsible for review and approval of contracts, or
modifications to them, expected to exceed $300,000 and executed by the
regional office's contracting staff. The RASC may obtain the advice of
the Regional Attorney in the review of proposed contract awards.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23127, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 51 FR 44293, Dec. 9, 1986; 52 FR 27558, July
22, 1987; 54 FR 24343, June 7, 1989]
Sec. 304.7102 Conduct of the review.
(a) General. Reviewing officials may solicit the participation of
specialists in various technical and administrative disciplines to aid
in the review. The method of the review is not prescribed here in order
to permit discretionary judgment in determining the depth to which
significant areas are to be examined.
(b) Contract file. The reviewer is to: (1) Determine that the
contract file constitutes an independent record, documented to provide a
complete chronology of actions related to all aspects of the
acquisition, and that the documentation is consistent with the
requirements of FAR 4.803;
(2) Determine that each contract file contains documentation or
other data (i.e., technical and business management evaluation, cost
advisory and audit reports, negotiation memorandum, etc.) sufficient to
explain and support the rationales, judgments, and authorities upon
which all decisions and actions were predicated; and
(3) Ascertain:
(i) If the proposed acquisition action is to be awarded by other
than full and open competition, that the documentation and approvals
supporting the decision are present in the contract file;
(ii) That proper publicizing of the proposed acquisition was made
pursuant to FAR Part 5;
(iii) That approval was obtained for any deviation from prescribed
contract clauses;
(iv) That sufficient competition was obtained, the competitive range
was appropriately determined, and oral or written discussions were
conducted with all firms in the competitive range;
(v) That all the rules set forth in FAR Part 14 were complied with
when the proposed award is a result of an IFB; and
(vi) That appropriate determinations and findings which justify the
type of contract and advance payments are a part of the contract file.
[49 FR 13961, Apr. 9, 1984, as amended at 50 FR 23127, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 304.7103 Approvals.
(a) Awards are not to be made until approval is granted by the
reviewing official identified in 304.7101. All approvals are to be in
writing, except that when time is of the essence approval may be given
orally and subsequently confirmed in writing.
(b) The reviewing official shall not approve a proposed contract
award if a substantive issue (or issues) remains to be resolved.
However, in appropriate circumstances, the reviewing official may use
discretion and grant approval on a conditional basis and require the
contracting officer to submit follow-up written documentation that the
substantive issue has been resolved. This provides the reviewing
official the option to require the contracting officer to resolve the
substantive issue and submit documenting evidence before award approval
is given, or to grant
[[Page 23]]
conditional approval providing the substantive issue is resolved before
the contract is awarded and require the contracting officer to submit
documenting evidence either before or after the award. The reviewing
official also has the option to determine the extent of documentation
evidence to be submitted by the contracting officer. This may range from
complete resubmission of the contract file to submission of a memorandum
stating the contracting officer's actions in resolving the substantive
issue.
[[Page 24]]
SUBCHAPTER B_ACQUISITION PLANNING
PART 305_PUBLICIZING CONTRACT ACTIONS
Subpart 305.1_Dissemination of Information
Sec.
Sec. 305.102 [Reserved]
Subpart 305.2_Synopsis of Proposed Contract Actions
Sec. 305.202 Exceptions.
Subpart 305.3_Synopses of Contract Awards
Sec. 305.303 Announcement of contract awards.
Subpart 305.5_Paid Advertisements
Sec. 305.502 Authority.
Sec. 305.503 Procedures.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13969, Apr. 9, 1984, unless otherwise noted.
Subpart 305.1_Dissemination of Information
Sec. 305.102 [Reserved]
Subpart 305.2_Synopsis of Proposed Contract Actions
Sec. 305.202 Exceptions.
(b) When a contracting office believes that it has a situation where
advance notice is not appropriate or reasonable, it shall prepare a
memorandum citing all pertinent facts and details and send it, through
normal acquisition channels, to the Director, Office of Acquisition and
Grants Management (DOAGM) requesting relief from synopsizing. The DOAGM
shall review the request and decide whether an exception to synopsizing
is appropriate or reasonable. If it is, the DOAGM shall take the
necessary coordinating actions required by FAR 5.202(b). Whatever the
decision is on the request, the DOAGM shall promptly notify the
contracting office when a determination has been made.
[51 FR 44293, Dec. 9, 1986, as amended at 54 FR 24343, June 7, 1989]
Subpart 305.3_Synopses of Contract Awards
Sec. 305.303 Announcement of contract awards.
(a) Public announcement. Any contract, contract modification, or
delivery order in the amount of $1 million or more shall be reported by
the contracting officer to the Office of the Deputy Assistant Secretary
for Legislation (Congressional Liaison), Room 406G, Hubert H. Humphrey
Building. Notification shall be accomplished by providing a copy of the
contract or award document face page to the referenced office prior to
the day of award, or in sufficient time to allow for an announcement to
be made by 5 p.m. Washington, DC time on the day of award.
[53 FR 43207, Oct. 26, 1988, as amended at 57 FR 11689, April 7, 1992]
Subpart 305.5_Paid Advertisements
Sec. 305.502 Authority.
The contracting officer is authorized to publish advertisements,
notices, and contract proposals in newspapers and periodicals in
accordance with the requirements and conditions referenced in FAR
Subpart 5.5.
Sec. 305.503 Procedures.
Requests for acquisition of advertising shall be accompanied by
written authority to advertise or publish which sets forth justification
and includes the names of newspapers or journals concerned, frequency
and dates of proposed advertisements, estimated cost, and other
pertinent information. Paid advertisements shall be limited to the
publication of essential details of grant announcements, invitations for
bids, and requests for proposals, including those for the sale of
personal property, and for the recruitment of employees.
[[Page 25]]
PART 306_COMPETITION REQUIREMENTS
Subpart 306.2_Full and Open Competition After Exclusion of Sources
Sec.
Sec. 306.202 Establishing or maintaining alternative sources.
Subpart 306.3_Other Than Full and Open Competition
Sec. 306.302 Circumstances permitting other than full and open
competition.
Sec. 306.302-1 Only one responsible source and no other supplies or
services will satisfy agency requirements.
Sec. 306.302-7 Public interest.
Sec. 306.303 Justifications.
Sec. 306.303-1 Requirements.
Sec. 306.303-2 Content.
Sec. 306.304 Approval of the justification.
Subpart 306.4_Sealed Bidding and Competitive Proposals
Sec. 306.401 Sealed bidding and competitive proposals.
Subpart 306.5_Competition Advocates
Sec. 306.501 Requirement.
Sec. 306.502 Duties and responsibilities.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 50 FR 23127, May 31, 1985, unless otherwise noted.
Subpart 306.2_Full and Open Competition After Exclusion of Sources
Sec. 306.202 Establishing or maintaining alternative sources.
(a) The reference to the agency head in FAR 6.202(a) shall mean the
appropriate competition advocate cited in 306.501.
(b)(1) The required determination and findings (D&F) shall be
prepared by the contracting officer based on the data provided by
program personnel, and shall be signed by the appropriate competition
advocate. The D&F signatory authority is not delegable.
[50 FR 23127, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended
at 51 FR 44293, Dec. 9, 1986]
Subpart 306.3_Other Than Full and Open Competition
Sec. 306.302 Circumstances permitting other than full and open
competition.
Sec. 306.302-1 Only one responsible source and no other supplies or
services will satisfy agency requirements.
(a) Authority. (2)(ii) Follow-on contracts for the continuation of
major research and development studies on long-term social and health
programs, major research studies, or clinical trails may be deemed to be
available only from the original source when it is likely that award to
any other source would result in unacceptable delays in fulfilling the
Department's or OPDIV's requirements.
(b) Application. (4) When the OPDIV head has determined that a
specific item of technical equipment or parts must be obtained to meet
an activity's program responsibility to test and evaluate certain kinds
and types of products, and only one source is available. (This criterion
is limited to testing and evaluation purposes only and may not be used
for initial outfitting or repetitive acquisitions. Project officers
should support the use of this criterion with citations from their
agency's legislation and the technical rationale for the item of
equipment required.)
(c) Application for brand name descriptions. There is existing
equipment which, for reasons of compatibility and interchangeability,
requires an item which is manufactured only by one source. (This
criterion is for use in acquisitions where a particular brand name item
is required, and an ``or equal'' will not meet the Government's
requirements. This criterion may not be used when there are other
manufacturers available which may be able to produce acceptable items
even though their products might require some adjustments and
modifications. These other manufacturers must be given the opportunity
to compete.)
[50 FR 23127, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended
at 51 FR 44293, Dec. 9, 1986; 57 FR 11689, Apr. 7, 1992]
[[Page 26]]
Sec. 306.302-7 Public interest.
(a) Authority. (2) Agency head, in this instance, means the
Secretary.
(c) Limitations. When using the authority cited in FAR 6.302-
7(a)(1), the Secretary's approval must be obtained. Therefore, an
``approval package'' must be prepared and staffed through departmental
acquisition channels to the Secretary. The package shall include:
(1) A determination and findings, prepared by the contracting
officer, for the Secretary to sign.
(2) A letter for the Secretary to sign notifying Congress of the
determination to award a contract under the authority of 41 U.S.C.
253(c)(7). This letter must be received by Congress at least 30 days
before contract award.
(3) A ``Justification for Other than Full and Open Competition''
(JOFOC).
(4) A briefing paper presenting background, need, etc.
(5) Any other pertinent papers or documents required by the
Department.
Sec. 306.303 Justifications.
Sec. 306.303-1 Requirements.
(b) Preliminary arrangements or agreements with the proposed
contractor made by someone other than the contracting officer shall have
no effect on the rationale used to support an acquisition for other than
full and open competition.
(f) The program office should discuss prospective other than full
and open competition requests with their supporting contracting office
as early as possible during the acquisition planning stage (see FAR
Subpart 7.1 and Subpart 307.1), and before submitting the requisition or
request for contract. The discussions may resolve uncertainties, provide
program offices with names of other sources, allow proper scheduling of
the acquisition, and avoid delays which might otherwise occur should it
be determined that the request for other than full and open competition
is not justified.
(g) When a program office desires to obtain certain goods or
services by contract without full and open competition, it shall, at the
time of forwarding the requisition or request for contract, furnish the
contracting office a justification explaining why full and open
competition is not feasible. All justifications shall be initially
reviewed by the contracting officer.
(1) Justifications in excess of the small purchase limitation shall
be in the form of a separate, self-contained document, prepared in
accordance with FAR 6.303 and 306.303, and called a ``JOFOC''
(Justification for Other than Full and Open Competition). Justifications
of $25,000 or less may be in the form of a paragraph or paragraphs
contained in the requisition or request for contract.
(2) Justifications, whether over or under the small purchase
limitation, shall fully describe what is to be acquired, offer reasons
which go beyond inconvenience, and explain why it is not feasible to
obtain competition. The justifications shall be supported by verifiable
facts rather than mere opinions. Documentation in the justifications
should be sufficient to permit an individual with technical competence
in the area to follow the rationale.
[50 FR 23127, May 31, 1985, as amended at 57 FR 11689, Apr. 7, 1992]
Sec. 306.303-2 Content.
(a)(1) The program office and name, address, and telephone number of
the project officer shall also be included.
(2) This item shall include project identification such as the
authorizing program legislation, to include citations or other internal
program identification data such as title, contract number, etc.
(3) A full description of the requirement and its dollar amount is
to be included. It may be in the form of a statement of work, purchase
description, or specification. A statement is to be included to explain
whether the acquisition is an entity in itself, whether it is one in a
series, or part of a related group of acquisitions.
(c) Each JOFOC shall conclude with at least the following signatory
lines (other concurrence lines may be added as deemed necessary by the
contracting activity):
Recommended, Project Officer____________________________________________
Date____________________________________________________________________
Concur, Project Officer's Immediate Supervisor__________________________
Date____________________________________________________________________
Concur, Contracting Officer_____________________________________________
[[Page 27]]
Date____________________________________________________________________
Approved, Approving Official____________________________________________
Date____________________________________________________________________
Sec. 306.304 Approval of the justification.
(a)(1) For purchases in excess of 10 percent of the small purchase
limitation but not over the small purchase limitation, the contracting
officer is authorized to review and approve (or disapprove) the
justification (see 313.106(c)(2)). For acquisitions over the small
purchase limitation, but not exceeding $100,000, the JOFOC shall be
submitted to the contracting officer for review. The contracting officer
will either concur or nonconcur, and forward the JOFOC to the principal
official responsible for acquisition for approval. (When the contracting
officer and principal official responsible for acquisition are the same
individual, the approval will be made by the respective official listed
in 306.501.) The principal official responsible for acquisition may
redelegate approval for acquisitions between the small purchase
limitation and $50,000 to the chief of the contracting office, provided
that individual is at least one level above the contracting officer who
will sign the contract.
(2) The competition advocates are listed in 306.501.
(3) The following shall serve as the approving officials referenced
in FAR 6.304(a)(3):
HCFA--Administrator for Health Care Financing
OHDS--Assistant Secretary for Human Development Services
OS--Assistant Secretary for Management and Budget
PHS--Assistant Secretary for Health (may be delegated to the Deputy
Assistant Secretary for Health Operations)
SSA--Commissioner of Social Security
RO's--Regional Director
This authority is not delegable, except as indicated for PHS.
(4) The senior procurement executive of the Department is the
Assistant Secretary for Management and Budget.
(c) A class justification shall be processed the same as an
individual justification.
(d) The contracting officer who receives a JOFOC for processing
shall, after ascertaining that the document is complete, request advice
from pricing, audit, legal, and other appropriate staff offices, and
forward the JOFOC with his or her concurrence or nonconcurrence, to the
appropriate approving official. When the contracting officer does not
concur with the JOFOC, a written explanation setting forth the reasons
must be provided the approving official. If the JOFOC is disapproved by
the approving official, the contracting officer shall promptly notify
the concerned program office.
(e) It is the responsibility of the approving official to determine
whether a contract may properly be awarded without full and open
competition. The program office and project officer are responsible for
furnishing the contracting officer and approving official with pertinent
supporting information necessary to make such determinations. Other
staff offices shall advise the contracting officer and approving
official as requested.
(f) As each justification is reviewed, the approving official should
ask: why the acquisition cannot be competed, are there sufficient
grounds for excluding all other actual or potential sources, what
actions can be taken to obtain full and open competition in the instant
acquisition, and what actions are needed to avoid the need for a
subsequent or continuing acquisition that is for other than full and
open competition?
[50 FR 23127, May 31, 1985, as amended at 56 FR 47002, Sept. 17, 1991]
Subpart 306.4_Sealed Bidding and Competitive Proposals
Sec. 306.401 Sealed bidding and competitive proposals.
The requirement in FAR 6.401 to document the reasons sealed bidding
is not appropriate may be accomplished by adding a sentence to the
negotiation memorandum (see 315.672) specifying which criterion (or
criteria) listed in FAR 6.401(a) is (are) not applicable to the
acquisition.
[[Page 28]]
Subpart 306.5_Competition Advocates
Sec. 306.501 Requirement.
The Department's competition advocate is the Deputy Assistant
Secretary for Management and Acquisition. The competition advocates for
the Department's primary contracting offices are as follows:
HCFA--Associate Administrator for Management and Support Services
OHDS--Director, Office of Management Services
OS--Director, Office of Acquisition and Grants Management
OASH--Director, Administrative Services Center
ADAMHA--Associate Administrator for Management
Sec. AHCPR--Executive Officer, Agency for Health Care Policy and
Research
CDC--Director, Office of Program Support
FDA--Associate Commissioner for Management and Operations
HRSA--Associate Administrator for Operations and Management
IHS--Associate Director, Office of Administration and Management
NIH--(R&D)--Associate Director for Extramural Affairs (Other than R&D)--
Associate Director for Intramural Affairs
SSA--Deputy Commissioner for Management.
RO's--Director, Regional Administrative Support Center
[50 FR 23127, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended
at 52 FR 27558, July 22, 1987; 53 FR 15563, May 2, 1988; 53 FR 43207,
Oct. 26, 1988; 54 FR 24343, June 7, 1989; 55 FR 42197, Oct. 18, 1990]
Sec. 306.502 Duties and responsibilities.
(b) The competition advocates listed in 306.501 shall assist the
Department's competition advocate, when requested, by providing data and
reports to aid in the accomplishment of the duties required of the
Department's competition advocate as stated in FAR 6.502(a).
[50 FR 23127, May 31, 1985, as amended at 50 FR 38004, Sept. 19, 1985]
PART 307_ACQUISITION PLANNING
Subpart 307.1_Acquisition Plans
Sec.
Sec. 307.104 General procedures.
Sec. 307.104-1 Requirement for acquisition planning.
Sec. 307.104-2 Responsibilities for acquisition planning.
Sec. 307.104-3 Preparation of acquisition plan.
Sec. 307.105 Contents of written acquisition plans.
Sec. 307.105-1 Format and content.
Sec. 307.105-2 Special program clearances or approvals.
Sec. 307.105-3 Specification, purchase description, and statement of
work.
Sec. 307.170 Program training requirements.
Sec. 307.170-1 Policy exceptions.
Sec. 307.170-2 Training course prerequisites.
Subpart 307.3_Contractor Versus Government Performance
Sec. 307.302 General.
Sec. 307.303 Determining availability of private commercial sources.
Sec. 307.304 Procedures.
Sec. 307.307 Appeals.
Subpart 307.70_Considerations in Selecting an Award Instrument
Sec. 307.7000 Scope of subpart.
Sec. 307.7001 Applicability.
Sec. 307.7002 Purpose.
Sec. 307.7003 Distinction between acquisition and assistance.
Sec. 307.7004 Procedures.
Subpart 307.71_Phase II Advance Acquisition Planning (Scheduling)
Sec. 307.7101 Background.
Sec. 307.7102 Accountability and responsibility.
Sec. 307.7103 Purpose.
Sec. 307.7104 Contracting activity actions.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13969, Apr. 9, 1984, unless otherwise noted.
Subpart 307.1_Acquisition Plans
Sec. 307.104 General procedures.
(a) The acquisition planning document is an administrative tool
designed to enable the contracting officer and project officer to plan
effectively for the accomplishment of an acquisition during a specified
time frame. The acquisition planning document serves as an outline of
the method by which the contracting officer expects to accomplish the
acquisition task.
(c) If the plan proposes using other than full and open competition,
the plan shall also be coordinated with the
[[Page 29]]
Chief of the contracting office, acting for the competition advocate.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 51 FR 44293, Dec. 9, 1986]
Sec. 307.104-1 Requirement for acquisition planning.
(a) The acquisition planning document is required for all new
negotiated acquisitions which are expected to exceed $100,000, except
the following:
(1) Acquisition of architect-engineer services;
(2) Acquisitions of utility services where the services are
available from only one source; and
(3) Acquisitions made from or through other Government agencies.
(b) An acquisition planning document is also required for all two-
step sealed bid acquisitions expected to exceed $100,000.
(c) The principal official responsible for acquisition shall
prescribe acquisition planning procedures for:
(1) Negotiated acquisitions which are not expected to exceed
$100,000;
(2) Two-step sealed bid acquisitions which are not expected to
exceed $100,000; and
(3) All other sealed bid acquisitions regardless of dollar amount.
(d) An acquisition planning document is not required for a contract
modification which either exercises an option or adds funds to an
incrementally funded contract, provided there is an approved acquisition
planning document in accordance with 307.105 and there is no significant
deviation from that plan.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 307.104-2 Responsibilities for acquisition planning.
(a) Planning by program and staff activities. Whenever execution of
a program or project requires the acquisition of property or services by
contract, the program or project plan shall delineate all elements to be
acquired by contract. The program or project plans must include a plan
and time-frame for completion action.
(b) Planning for acquisition actions. Action should commence as
early as possible to effect an orderly and balanced acquisition workload
throughout a fiscal year. Project officers who expect to initiate
acquisitions are required to discuss their requirements with the
contracting officials who will be responsible for these acquisitions to
compare current staff capabilities with anticipated requirements to
achieve an even distribution of fiscal year workload consistent with
program needs. These discussions should result in understandings on:
(1) The details of the acquisition plan;
(2) Schedule for the completion of the acquisition plan;
(3) Preliminary discussions on the work statement/specifications and
appropriate evaluation criteria; and
(4) Preliminary discussions on the content and timing of the request
for contract (RFC).
(c) Planning by contracting activities. Contracting activities are
required to coordinate with program and staff offices to ensure:
(1) Timely and comprehensive planning for acquisitions;
(2) Timely initiation of requests for contracts; and
(3) Instruction of program and staff offices in proper acquisition
practices and methods.
Sec. 307.104-3 Preparation of acquisition plan.
(a) The acquisition planning document serves as an advance agreement
between program and contracting personnel by outlining the methods of
how and when the acquisition is to be accomplished. It serves to resolve
problems early in the acquisition cycle thereby precluding delays in
contract placement. It is developed prior to the preparation and
submission of the formal request for contract to the contracting
activity. (For detailed information concerning the request for contract,
see Subpart 315.70.)
(b) The acquisition planning document shall be prepared jointly by
the project officer and the contract negotiator or in accordance with
procedures prescribed by the principal official responsible for
acquisition.
[[Page 30]]
Sec. 307.105 Contents of written acquisition plans.
Sec. 307.105-1 Format and content.
The Department does not prescribe a standard format for the
acquisition planning document, but recommends the use of a format
similar to what is provided in this section. The subject areas addressed
in paragraphs (a) through (e) must be included in every acquisition
planning document. An OPDIV, agency, or regional office contracting
activity may prescribe a standard format for the acquisition planning
document and may include additional subject areas that are pertinent to
that activity's needs.
(a) Identification information. The contracting activity shall
prescribe the information necessary for readily identifying a planned
acquisition. The information may include items such as acquisition
planning document number, request for contract number, public law,
program or project officer, etc.
(b) Programmatic considerations. (1) Description of the project/
supplies/services. Include a brief description of the proposed project/
supplies/services. Discuss all anticipated future requirements related
to the acquisition. Discuss any past, present or future interrelated
projects.
(2) Project funding. Include the summary of funds expected to be
obligated for the entire project by fiscal years and phases. Include
expenditures for previous years. Discuss the probability of obtaining
future years funding and/or what specific managerial action can be taken
to insure future funding (if applicable).
(3) Background and acquisition history. Provide a brief factual
summary of the technical and contractual history of the supplies/
services being acquired.
(4) Related projects, efforts undertaken to avoid duplication of
effort. Discuss efforts made to determine if existing projects, supplies
or materials will satisfy the requirement. Include any related in-house
efforts, searches, and clearinghouse reviews made to avoid duplication
of effort.
(5) Need for project/supplies/services. Discuss rationale for
deciding on the need for the project/supplies/services.
(6) Special program clearances or approvals. Review 307.105-2 to
determine which special program clearances or approvals are required.
Specify clearances or approvals applicable to this acquisition.
(7) Phasing. Briefly describe discrete tasks or stages of
accomplishment which could be susceptible to phasing. Describe criteria
for evaluation of performance of each phase before proceeding to the
next. (See 307.105-3(c)(3) for a discussion on phasing.)
(8) Government furnished material/facilities. Indicate material and
facilities that will be furnished to the contractor and any associated
problems which may be encountered. Discuss possible inequities which may
arise in furnishing the materials or facilities. Discuss screening
efforts for availability through GSA excess property schedules.
(9) Discussion of project risk. Provide a discussion of major areas
of project risk including technical, cost, and schedule risk. Describe
what efforts are planned to reduce risk. If an acquisition, which is
planned to be awarded using other than full and open competition
represents a significant portion of a proposed contractor's business,
discuss the impact on technical capability, realism of schedule, changes
in contractor workload and related cost impact.
(10) Reporting/delivery requirements. Describe the basis for
establishing the delivery/reporting requirements and include the
anticipated deliverables and time(s) for delivery.
(11) Replication, dissemination, or use of the results. Discuss
anticipated replication, dissemination, or use of the results. Describe
user audience and their expected use. Include a description of the
delivery system.
(12) Data, data rights, patents, copyrights. Discuss data to be
developed. Specify data to be delivered and data to remain in the
contractor's possession. Discuss how the data is to be used, maintained,
disclosed and disposed of by the contractor. Discuss data subject to the
Privacy Act or Confidentiality of Information clause. Discuss data to be
delivered with limited rights, data where title would not vest in the
Government, and anticipated
[[Page 31]]
copyrights or patents. Discuss whether or not the data will permit any
follow-on acquisitions to be competitive.
(13) Post-award administration and monitoring. Detail milestones
that require periodic evaluation of the contractor's progress. Discuss
any formal management systems to be used to monitor the contractor.
Discuss plans for post-award conference and site visits. Delineate the
timing of the periodic status reports.
(14) Technical evaluation plans. Discuss the plans for technical
evaluation of the proposal. Discuss whether non-Federal technical
evaluators will review the proposals. Discuss potential conflict of
interest situations.
(c) Acquisition approach. (1) Proposed sources. Include sources or
categories of sources (if apparent). Address the pertinent areas stated
in FAR 7.105(b)(2).
(2) Contract type. Provide the rationale for recommendation of
contract type.
(3) Socioeconomic programs. Discuss preliminary liaison with the
Small and Disadvantaged Business Utilization Specialist for review to
determine requirements susceptible for the various socioeconomic
acquisition programs; i.e., small business, disadvantaged business, or
labor surplus area set-asides.
(4) Other considerations, as applicable. Discuss special contract
clauses and proposed HHSAR deviations, if required. Discuss
circumstances such as the effect of a protest on a previous acquisition
to this acquisition, special public law or regulatory requirements which
place restrictions on this acquisition, and use of a special type of
synopsis. Address planned preproposal conference, preaward survey and
preaward site visits.
(d) Planning for the acquisition cycle. (1) Scheduling
considerations. The project officer and the contract negotiator shall
establish realistic planned dates which meet the program needs for award
to assure timely delivery or completion of the project. The following
factors should be considered in planning realistic dates:
(i) Individual project officer and contract negotiator workloads;
(ii) Planned, extended absences from the office; and
(iii) Schedules are in consonance with established office goals for
overall orderly and balanced workloads.
(2) Acquisition planning schedule. The following acquisition
planning schedule should be included in all plans to the extent the
items are significant or appropriate to the acquisition. Additional
items may be added as appropriate.
Acquisition Planning Schedule
Actions and Date
Advance or sources sought synopsis released
Advance or sources sought synopsis closed
Synopsis evaluation received
Request for contract received
Special program approvals received
Synopsis publicizing proposed acquisition released
Request for proposal released
Preproposal conference conducted
Proposals received
Technical evaluation received
Cost advisory or audit report received
Equal opportunity clearance obtained
Prenegotiation conference conducted
Negotiation completed
Contract document prepared
Contract approval completed
Contract released
Award
(e) Approvals. All acquisition planning documents shall be signed by
the project officer and the contract negotiator. Acquisition planning
documents for acquisitions estimated to be between $100,000 and
$1,000,000 shall be approved by the contracting officer. Acquisition
planning documents for acquisitions estimated to be in excess of $1
million shall be approved by the principal official responsible for
acquisition or his/her designee. The designated official shall be in a
position no lower than the level above the contracting officer. One copy
of all acquisition planning documents shall be filed with the principal
official responsible for acquisition or the designated official for
planning purposes. The original acquisition planning document shall be
retained in the contract file.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
[[Page 32]]
Sec. 307.105-2 Special program clearances or approvals.
The following special program clearances or approvals should be
reviewed for applicability to each planned acquisition. The ones which
are applicable should be addressed in the acquisition planning document
and immediate programmatic action should be initiated to obtain the
necessary clearances or approvals.
(a) Clearances or approvals required to be completed and submitted
with the request for contract (RFC). (1) Automatic data processing. All
proposed acquisitions of automatic data processing hardware, software
packages, and services, as well as telecommunications equipment, which
exceed the dollar thresholds stated in Chapter 4-10 of the HHS
Information Resources Management (IRM) Manual, must be reviewed and
approved by the Office of Information Resources Management (OIRM),
OASMB-0S. (See HHS Information Resources Management (IRM) Manual,
Chapter 4-10; Title 41 CFR Chapter 201; and Subpart 339.70.)
(2) ADP systems security. All ADP systems regardless of dollar
amount are required to have a Certification of ADP Systems Security
Adequacy signed by the ADP system manager and the cognizant ADP systems
security officer. (See HHS IRM Manual, Part 6--ADP Systems Security; OMB
Circular No. A-71, Transmittal Memorandum No. 1; and Subpart 339.70.)
(3) Advisory and assistance services. OPDIV and STAFFDIV heads and
regional directors are responsible for review and approval of all
proposed advisory and assistance services contracts and purchase orders.
(See General Administration Manual Chapter 8-15.)
(4) Evaluation contracts. The Assistant Secretary for Planning and
Evaluation (ASPE) must approve all evaluation projects for proposed
solicitations, except those which have been included in research,
demonstration, or evaluation plans previously approved by the ASPE.
(5) Commercial activities. (OMB Circular No. A-76) A request for
contract (RFC) must contain a statement as to whether the proposed
solicitation is or is not to be used as part of an OMB Circular No. A-76
cost comparison. (See General Administrative Manual (GAM) Chapter 18-10;
FAR Subpart 7.3, Subpart 307.3; OMB Circular No. A-76.)
(6) Paid advertising. Paid advertisements, notices or contract
proposals to be published in newspapers and periodicals may be
authorized by the contracting officer. (See FAR Subpart 5.5, Subpart
305.5; Title 7, Chapter 5-25.2, and the General Accounting Office Policy
and Procedures Manual for Guidance of Federal Agencies.)
(7) Printing. The acquisition of printing by contract is prohibited
unless it is authorized by the Joint Committee on Printing of the U.S.
Congress. Procedures to be followed are contained in the ``Government
Printing and Binding Regulations'' and the HHS Printing Management
Manual and FAR Subpart 8.8.
(8) Fraud, abuse and waste. All proposed acquisitions that concern
the subjects of fraud, abuse and waste must be reviewed and approved by
the Inspector General or Deputy Inspector General, and written approval
from either must be included in the request for contract.
(9) Paperwork Reduction Act. Under the Paperwork Reduction Act of
1980 (Pub. L. 96-511), a Federal agency shall not collect information or
sponsor the collection of information from ten or more persons (other
than Federal employees acting within the scope of their employment)
unless, in advance, the agency has submitted Standard Form 83, Request
for OMB Review, to the Director of the Office of Management and Budget,
and the Director has approved the proposed collection of information.
Procedures for the approval may be obtained by contacting the OPDIV
reports clearance officer. (See Title 5 CFR Part 1320 and General
Administration Manual Chapter 10-20.)
(10) Contracts with federal employees. Contracts between the
Government and Government employees or between the Government and
organizations which are substantially owned or controlled by Government
employees may not knowingly be entered into, except for the most
compelling reasons (see FAR Subpart 3.6). Authority to enter into a
contract with a Government employee or an organization substantially
owned
[[Page 33]]
or controlled by a Government employee must be approved prior to award
of the contract by either the Assistant Secretary for Management and
Budget, the head of the OPDIV, or the regional director, or their
designees. (See 45 CFR Part 73 and HHS Standards of Conduct.)
(11) Publications. All projects which will result in contracts and
which include publications require review and approval by the Office of
the Assistant Secretary for Public Affairs (OASPA). Form HHS-615,
Publication Planning and Clearance Request, should be forwarded to OASPA
through the OPDIV public affairs officer. Publications are defined in
the chapter on publications in the Public Affairs Management Manual.
(12) Public affairs services. Projects for the acquisition of public
affairs services in excess of $5,000 shall be submitted to the Office of
the Assistant Secretary for Public Affairs (OASPA) for review and
approval on Form HHS-524, Request for Public Affairs Service Contract.
(13) Audiovisual (videotape and motion picture production). Any
proposed acquisition of an audiovisual production requires the
submission of a Standard Form 282, Mandatory Title Check, to the
National Audiovisual Center (NAC). When the results of this title check
have been reviewed by the project office and if a determination is made
that existing materials are not adequate to fulfill the requirement, a
statement to that effect shall be prepared by the project office. For
acquisitions in excess of $5,000, a copy of that statement, together
with a Standard Form 202, Federal Audiovisual Production Report, and
Form HHS-524A, Request for Audiovisual Material, shall be submitted
through the OPDIV public affairs officer to the Office of the Assistant
Secretary for Public Affairs (OASPA) for review and approval. Following
approval by OASPA, the SF 202 and the statement explaining why existing
materials are insufficient will be forwarded to NAC by OASPA. An
approved copy of the Form HHS-524A will be returned to the OPDIV for
transmission to the contract negotiator. All audiovisuals are required
to be acquired under the Government-wide Contracting System for Motion
Picture and Videotape Productions, unless they are included in the
exceptions to the mandatory use of the uniform system. (See the
Executive Agent for Government-Wide Contracting System for Audiovisual
Productions' March 21, 1980, memorandum on Implementation of OFPP Policy
Letter No. 79-4, November 28, 1979, Contracting for Motion Picture and
Videotape Productions; HHS General Administration Manual Chapter 1-121.)
(14) Privacy Act (Pub. L. 93-579.) Whenever the Department contracts
for the design, development, operation, or maintenance of a system of
records on individuals on behalf of the Department in order to
accomplish a departmental function, the Privacy Act is applicable. The
program official, after consultation with the activity's Privacy Act
Coordinator and the Office of General Counsel as necessary shall include
a statement in the request for contract as to the applicability of the
Act. Whenever an acquisition is subject to the Act, the program official
prepares a ``system notice'' and has it published in the Federal
Register. (See HHS Privacy Act regulation, 45 CFR 5b; FAR Subpart 24.1
and Subpart 324.1.)
(b) Clearances or approvals required to be completed prior to
contract award. All foreign research contract projects to be conducted
in a foreign country and financed by HHS funds (U.S. dollars) must have
clearance by the Department of State with respect to consistency with
foreign policy objectives. This clearance should be obtained prior to
negotiation. Procedures for obtaining this clearance are set forth in
the HHS General Administration Manual, Chapter 20-60.
[49 FR 13969, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984;
50 FR 23129, May 31, 1985; 50 FR 38004, Sept. 19, 1985; 53 FR 15563, May
2, 1988; 53 FR 43207, Oct. 26, 1988; 53 FR 44551, Nov. 3, 1988]
Sec. 307.105-3 Specification, purchase description, and statement of
work.
One of the most important parts of a contract is the description of
the work to be done. The description of that work may be in the form of
a specification, purchase description or statement
[[Page 34]]
of work. A brief reference to specifications and purchase descriptions
is provided, although the nature of the work performed in this
Department usually results in the development of work statements. The
development of the acquisition planning document should result in
sufficient information to readily develop the description of work,
usually in the form of a statement of work.
(a) Specification. Specification is defined in FAR 10.001. Use of
the specification is primarily limited to supply or service contracts
where the material end item or service to be delivered is well defined
by the Government.
(b) Purchase description. FAR 10.001 also contains the definition of
purchase description.
(c) Statement of work. (1) General. A statement of work differs from
a specification and purchase description primarily in that it describes
work or services to be performed in reaching an end result rather than a
detailed, well defined description or specification of the end product.
The statement of work may enumerate or describe the methods
(statistical, clinical, laboratory, etc.) that will be used. However, it
is preferable for the offeror to propose the method of performing the
work. The statement of work should specify the desired results,
functions, or end items without telling the offeror what has to be done
to accomplish those results unless the method of performance is critical
or required for the successful performance of the contract. The
statement of work should be clear and concise and must completely define
the responsibilities of the Government and the contractor. The statement
of work should be worded so as to make more than one interpretation
virtually impossible because it has to be read and interpreted by
persons of varied backgrounds, such as attorneys, contracting personnel,
cost estimators, accountants, scientists, sociologists, educators,
functional specialists, etc. If the statement of work does not state
exactly what is wanted, or does not state it precisely, it will generate
many contract management problems for both the project officer and the
contracting officer. Ambiguous statements of work can create
unsatisfactory performance, delays, and disputes, and can result in
higher costs.
(2) Term (level of effort) vs. completion work statement. Careful
distinctions must be drawn between term (level of effort) statements of
work, which essentially require the furnishing of technical effort and a
report thereof, and completion type work statements, which often require
development of tangible end items designed to meet specific performance
characteristics.
(i) Term or level of effort. A term or level of effort type
statement of work is appropriate to research where one seeks to discover
the feasibility of later development, or to gather general information.
A term or level of effort type statement of work may only specify that
some number of labor-hours be expended on a particular course of
research, or that a certain number of tests be run, without reference to
any intended conclusion.
(ii) Completion. A completion type statement of work is appropriate
to development work where the feasibility of producing an end item is
already known. A completion type statement of work may describe what is
to be achieved through the contracted effort, such as the development of
new methods, new end items, or other tangible results.
(3) Phasing. Individual research, development, or demonstration
projects frequently lie well beyond the present state of the art and
entail procedures and techniques of great complexity and difficulty.
Under these circumstances, a contractor, no matter how carefully
selected, may be unable to deliver the desired result. Moreover, the job
of evaluating the contractor's progress is often difficult. Such a
contract is frequently phased and often divided into stages of
accomplishment, each of which must be completed and approved before the
contractor may proceed to the next. Phasing makes it necessary to
develop methods and controls, including reporting requirements for each
phase of the contract and criteria for evaluation of the reports
submitted, that will provide, at the earliest possible time, appropriate
data for making decisions relative to all phases. A phased contract may
include
[[Page 35]]
stages of accomplishment such as research, development, and
demonstration. Within each phase, there may be a number of tasks which
should be included in the statement of work. When phases of work can be
identified, the statement of work will provide for phasing and the
request for proposals will require the submission of proposed costs by
phases. The resultant contract will reflect costs by phases, require the
contractor to identify incurred costs by phases, establish delivery
schedules by phases, and require the written acceptance of each phase.
The provisions of the Limitation of Cost clause shall apply to the
estimated cost of each phase. Contractors shall not be allowed to incur
costs for phases which are dependent upon successful completion of
earlier phases until written acceptance of the prior work is obtained
from the contracting officer.
(4) Elements of the statement of work. The elements of the statement
of work will vary with the objective, complexity, size, and nature of
the acquisition. In general, it should cover the following matters as
appropriate.
(i) A general description of the required objectives and desired
results. Initially, a broad, nontechnical statement of the nature of the
work to be performed. This should summarize the actions to be performed
by the contractor and the results that the Government expects.
(ii) Background information helpful to a clear understanding of the
requirements and how they evolved. Include a brief historical summary as
appropriate. Include pertinent legislative history, related contracts or
grants, and the relationship to overall program objectives.
(iii) A detailed description of the technical requirements. A
comprehensive description of the work to be performed to provide
whatever details are necessary for prospective offerors to submit
meaningful proposals.
(iv) Subordinate tasks or types of work. A listing of the various
tasks or types of work (it may be desirable in some cases to indicate
that this is not all-inclusive). The degree of task breakout is directly
dependent on the size and complexity of the work to be performed and the
logical groupings. A single cohesive task should not be broken out
merely to conform to a format. Indicate whether the tasks are sequential
or concurrent for offeror planning purposes.
(v) Phasing. When phasing is applicable, describe in detail the work
or effort required in each phase and the criteria for determining
whether the next phase will take place. If one or more phases contain
subordinate tasks or types of work, the preceding information in
paragraph (c)(4) (iv) may be incorporated into the part.
(vi) Reference material. All reference material to be used in the
conduct of the project, such as technical publications, reports,
specifications, architect or engineering drawings, etc., that tell how
the work is to be carried out must be identified. Applicability should
be explained, and a statement made as to where the material can be
obtained.
(vii) Level of effort. When a level of effort is required, the
number and type of personnel required should be stated. If known, the
type and degree of expertise should be specified.
(viii) Special requirements (as applicable). An unusual or special
contractual requirement, which would impact on contract performance,
should be included as a separate section. Such items could include
required place(s) of performance or unusual travel requirements.
Clearance requirements, such as forms clearance, should be addressed.
(ix) Deliverables reporting requirements. All deliverables and/or
reports must be clearly and completely described. For example, in a
Final Study Report it is important to indicate what areas the report
should cover and the criteria for use in accepting the final report to
determine if the contract objectives have been satisfied. It is
important to require the preparation and submission of progress reports
(administrative, technical and financial) to reflect contractor
certification of satisfactory progress. If possible, the reports should
be coordinated in such a manner as to provide a correlation between
costs incurred and the state of completion. All delivery and reporting
requirements shall include the quantities, the place of delivery, and
time of delivery.
[[Page 36]]
Sec. 307.170 Program training requirements.
(a) Chapter 8-95 of the General Administration Manual (GAM)
addresses the general parameters for acquisition planning as stated in
307.104. In conjunction with the principles of proper acquisition
planning, the Department has established training courses for program
officials to promote expedient program management in the planning and
other pertinent aspects of the acquisition process. Chapter 8-96 of the
GAM sets forth specific training requirements for program officials as
follows:
(1) All program personnel selected to serve as project officer for
an HHS contract shall have successfully completed either the
Department's appropriate ``Base Project Officer'' course, or an
equivalent course (see paragraph (b), below).
(2) At least fifty percent of the HHS program personnel performing
the function of technical proposal evaluator on a technical evaluation
team or panel for any competitively solicited HHS contract shall have
successfully completed the appropriate ``Basic Project Officer'' course,
or an equivalent course (see paragraph (b), below). This requirement
applies to the initial technical proposal evaluation and any subsequent
technical evaluations that may be required.
(b) Determination of course equivalency shall be made by the
principal official responsible for acquisition of the cognizant
contracting activity. The contracting officer is responsible for
ensuring that the project officer and technical proposal evaluators have
successfully completed the required training discussed in 307.170-2.
[49 FR 13969, Apr. 9, 1984, as amended at 56 FR 47002, Sept. 17, 1991]
Sec. 307.170-1 Policy exceptions.
(a) Small contracting activities. (1) Program personnel designated
to serve as project officers and technical proposal evaluators for
contracts which originate in offices having a mission which only
incidentally and infrequently involves the generation of contract
requirements (i.e., normally less than three contract requirements per
fiscal year and in an amount not exceeding $100,000 per contract) are
not required to have completed any of the referenced training courses,
although completion of an appropriate ``Basic Project Officer'' course
is recommended.
(2) As a substitute for the training, contracting officers servicing
these program offices are required to ensure, as a minimum, that program
personnel designated to serve as project officers and technical proposal
evaluators have read and studied the ``DHHS Project Officers'
Contracting Handbook,'' and fully understand their responsibilities. The
contracting officer shall require these program personnel to furnish
written certification that they have fulfilled this requirement prior to
discharging the duties of project officer or technical proposal
evaluator.
(b) Urgent requirements. In the event there is an urgent requirement
for a specific individual to serve as a project officer and that
individual has not successfully completed the prerequisite training
course, the principal official responsible for acquisition may waive the
training requirement and authorize the individual to perform the project
duties, provided that:
(1) The individual first meets with the cognizant contracting
officer to review the ``DHHS Project Officers' Contracting Handbook,''
and to discuss the important aspects of the contracting--program office
relationship as appropriate to the circumstances; and
(2) The individual attends the next scheduled and appropriate
``Basic Project Officer'' course.
[49 FR 13969, Apr. 9, 1984, as amended at 56 FR 47002, Sept. 17, 1991]
Sec. 307.170-2 Training course prerequisites.
(a) Project officers. (1) Newly appointed project officers, and
project officers with less than three years experience and no previous
related training, are required to take the appropriate ``Basic Project
Officer'' course. (The grade level for project officers attending the
course should be GS-7 and above). All project officers are encouraged to
take the appropriate ``Writing Statements of Work'' course.
[[Page 37]]
(2) Project officers with more than three years experience, and
project officers with less than three years experience who have
successfully completed the appropriate basic course, are qualified (and
encouraged) to take the ``Advanced Project Officer'' course.
(3) Additional information on prerequisites for attendance of these
courses may be found in the ``DHHS Acquisition Training and
Certification Program Handbook.''
(b) Technical proposal evaluators. Technical proposal evaluators,
regardless of experience, are required to take the appropriate ``Basic
Project Officer'' course. Upon successful completion of the basic
course, it is recommended that they take the appropriate ``Advanced
Project Officer'' course.
[49 FR 13969, Apr. 4, 1984, as amended at 56 FR 47002, Sept. 17, 1991]
Subpart 307.3_Contractor Versus Government Performance
Sec. 307.302 General.
(a) GAM Chapter 18-10, Commercial-Industrial Activities of the
Department of Health and Human Services Providing Products or Services
for Government Use, assigns responsibilities for making method-of-
performance decisions (contract vs. in-house performance) to various
management levels within the Department depending on the dollar amount
of capital investment or annual operating costs. It also requires that
each operating division (OPDIV), staff division (STAFFDIV) and regional
office (RO) designate a ``Commercial-Industrial Control Officer'' (CICO)
to be responsible for ensuring compliance with the requirements of the
Chapter.
(d) Besides contracts with annual operating costs under $100,000,
contracts under an authorized acquisition set-aside for small business
or labor surplus area concerns and contracts made pursuant to section
8(a) of the Small Business Act are exempted from the requirements of FAR
Subpart 7.3, GAM Chapter 18-10, and OMB Circular No. A-76.
Sec. 307.303 Determining availability of private commercial sources.
In accordance with the provisions of GAM Chapter 18-10, OPDIVs,
STAFFDIVs, and ROs and must prepare and maintain a complete inventory of
all individual commercial or industrial activities, including those
conducted under contracts in excess of $100,000 annually. They must also
conduct periodic reviews of each activity and contract in the inventory
to determine if the existing performance, in-house or by contract,
continues to be in accordance with the policy guidelines of GAM Chapter
18-10.
Sec. 307.304 Procedures.
Contracting officers shall ensure that no acquisition action
involving a commercial-industrial activity is initiated unless it is in
compliance with the requirements of GAM Chapter 18-10. The contracting
officer must check each request for contract expected to result in a
contract in excess of $100,000 to ensure that it contains a statement as
to whether the proposed contract is or is not subject to review under
GAM Chapter 18-10 requirements. If the contracting officer has any
questions regarding the determination of applicability or
nonapplicability, or if the required statement is missing, the program
office submitting the request for contract should be contacted and the
situation rectified. If the issue cannot be resolved with the program
office, the contracting officer shall refer the matter to the CICO for a
final determination. The principal official responsible for acquisition
is responsible for ensuring that contracting activities are in full
compliance with FAR Subpart 7.3.
Sec. 307.307 Appeals.
The review and appeals procedures discussed in FAR 7.307 are
addressed in GAM Chapter 18-10.
Subpart 307.70_Considerations in Selecting an Award Instrument
Sec. 307.7000 Scope of subpart.
This subpart provides guidance on the appropriate selection of award
instruments consistent with the Federal
[[Page 38]]
Grant and Cooperative Agreement Act of 1977 (Pub. L. 95-224) and the OMB
implementation of the Act as published in the Federal Register on August
18, 1978 (41 FR 36860). This subpart addresses acquisition relationships
where the award instrument is the contract, and assistance relationships
where the award instrument is either a grant or cooperative agreement.
Sec. 307.7001 Applicability.
This subpart applies to the choice of award instrument--contract,
grant, or cooperative agreement--for all program and individual
transactions, except where specifically prohibited by law.
Sec. 307.7002 Purpose.
This subpart provides guidance to assist in the determination of
whether to use the acquisition or assistance process to fulfill program
needs. The distinction between, and use of, grants and cooperative
agreements is not discussed in detail. Detailed guidance may be found in
Chapter 1-02 of the Grants Administration Manual.
Sec. 307.7003 Distinction between acquisition and assistance.
(a) The Federal Grant and Cooperative Agreement Act of 1977 requires
the use of contracts to acquire property or services for the direct
benefit or use of the Government and grants or cooperative agreements to
transfer money, property, services, or anything of value to recipients
to accomplish a public purpose of support or stimulation authorized by
Federal statute.
(b) A contract is to be used as the legal instrument to reflect a
relationship between the Federal Government and a recipient whenever:
(1) The principal purpose of the instrument is the acquisition, by
purchase, lease, or barter, of property or services for the direct
benefit or use of the Federal Government; or
(2) The Department determines in a specific instance that the use of
a type of contract is appropriate. That is, it is determined in a
certain situation that specific needs can be satisfied best by using the
acquisition process. However, this authority does not permit
circumventing the criteria for use of acquisition or assistance
instruments. Use of this authority is restricted to extraordinary
circumstances and only with the prior approval of the Director, Office
of Acquisition and Grants Management.
(c) A grant or cooperative agreement is to be used as the legal
instrument to reflect a relationship between the Federal Government and
a recipient whenever the principal purpose of the relationship is the
transfer of money, property, services, or anything of value to the
recipient to accomplish a public purpose of support or stimulation
authorized by Federal statute.
(1) A grant is the legal instrument to be used when no substantial
involvement is anticipated between the Department and the recipient
during performance of the contemplated activity.
(2) A cooperative agreement is the legal instrument to be used when
substantial involvement is anticipated between the Department and the
recipient during performance of the contemplated activity.
(d) As a general rule, contracts are to be used for the following
purposes:
(1) Evaluation (including research of an evaluative nature) of the
performance of Government programs or projects or grantee activity
initiated by the funding agency for its direct benefit or use.
(2) Technical assistance rendered to the Government, or on behalf of
the Government, to any third party, including those receiving grants or
cooperative agreements.
(3) Surveys, studies, and research which provide specific
information desired by the Government for its direct activities, or for
dissemination to the public.
(4) Consulting services or professional services of all kinds if
provided to the Government or, on behalf of the Government, to any third
party.
(5) Training projects where the Government selects the individuals
or specific groups whose members are to be trained or specifies the
content of the curriculum (not applicable to fellowship awards).
(6) Planning for Government use.
[[Page 39]]
(7) Production of publications or audiovisual materials required
primarily for the conduct of the direct operations of the Government.
(8) Design or development of items for Government use or pursuant to
agency definition or specifications.
(9) Conferences conducted on behalf of the Government.
(10) Generation of management information or other data for
Government use.
(e) As a general rule, grants or cooperative agreements are to be
used for the following purposes:
(1) General financial assistance (stimulation or support) to
eligible recipients under specific legislation authorizing the
assistance.
(2) Financial assistance (stimulation or support) to a specific
program activity eligible for assistance under specific legislation
authorizing the assistance.
[49 FR 13969, Apr. 9, 1984, as amended at 54 FR 24343, June 7, 1989]
Sec. 307.7004 Procedures.
(a) OPDIV, agency, and regional office program officials should use
existing budget and program planning procedures to propose new
activities and major changes in ongoing programs. It is the
responsibility of these program officials to meet with the principal
official responsible for acquisition and the principal grants management
official, or their designees, to distinguish the relationships and
determine whether award is to be made through the acquisition process or
assistance process. This determination should be made prior to the time
when the annual acquisition plan is reviewed and approved so that the
plan will reflect all known proposed contract actions. The cognizant
contracting officer will confirm the appropriateness of the use of the
contract instrument when reviewing the request for contract.
(b) Shifts from one award instrument to another must be fully
documented in the appropriate files to show a fundamental change in
program purpose that unequivocably justifies the rationale for the
shift.
(c) OPDIVs, agencies, and regional offices must ensure that the
choice of instrument is determined in accordance with the Federal Grant
and Cooperative Agreement Act of 1977 and applicable departmental
policies. If, however, there are major individual transactions or
programs which contain elements of both acquisition and assistance in
such a way that they cannot be characterized as having a principal
purpose of one or the other, guidance should be obtained from the
Director, Office of Acquisition and Grants Management through normal
channels, before proceeding with a determination.
(d) Any public notice, program announcement, solicitation, or
request for applications or proposals must indicate whether the intended
relationship will be one of acquisition or assistance and specify the
award instrument to be used.
[49 FR 13969, Apr. 9, 1984, as amended at 54 FR 24343, June 7, 1989]
Subpart 307.71_Phase II Advance Acquisition Planning (Scheduling)
Sec. 307.7101 Background.
(a) Failure to properly plan individual acquisitions and failure to
schedule the overall acquisition workload of an office, agency, or OPDIV
tends to result in an inordinate percentage of contract awards being
made in the closing weeks and even days of the fiscal year. This
phenomenon, variously identified as ``The September Rush'', ``Hurry-up
Spending'', ``End-of-Year Purchasing'', and ``Year-End Spending
Abuses'', in turn fosters rushed, other than full and open competition,
inadequately documented, and potentially wasteful acquisitions.
Excessive year-end spending also invites increased intervention and/or
scrutiny from Congress, the Office of Management and Budget, and the
media. The end of the fiscal year, however, is usually too late to take
corrective actions that are effective without being unduly damaging to
necessary programs. The key is to begin advance acquisition planning far
earlier.
(b) To avoid the historic pattern of wasteful and unnecessary year-
end spending, the Department introduced the Acquisition Planning
Initiative by Under Secretarial memorandum of
[[Page 40]]
February 19, 1980, Subject: New Procedures to Improve Planning and
Scheduling of Contract Awards and Curb Last-Minute Year-End Procurement
Spending. Phase II of this initiative, beginning with Fiscal Year 1981,
established the present acquisition planning mechanism. Basic guidance
on the Phase II mechanism is contained in the ASMB memorandum of March
28, 1980, Subject: Phase II of (Fiscal Year 1981) Procurement Planning
Initiative--Guidelines for Program Funding Milestones. For the Public
Health Service, the above guidance is supplemented by the ASMB
memorandum of April 21, 1982, Subject: Phase II Annual Procurement
Planning.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 307.7102 Accountability and responsibility.
Phase II is a Department-wide monitoring and accountability system
that requires early planning of acquisition requirements down to the
individual project level. The Phase II mechanism includes the following:
(a) Accountability lies with the OPDIV and STAFFDIV heads who are
required to coordinate overall schedules which plot the planned
distribution of RFC deliveries and contract awards over an eighteen-
month timeline extending to fiscal year-end.
(b) Each OPDIV and STAFFDIV retains the flexibility to schedule
individual RFC deliveries and contract awards as desired, so long as the
overall schedule presents a relatively even distribution of contract
awards and workload across the fiscal year.
(c) The schedules are updated quarterly to compare actual versus
planned progress and, when necessary, to revise the schedules for the
remainder of the fiscal year.
(d) Project officers are responsible for initiating the project
planning by coordinating with contracting activities prior to RFC
preparation, and taking the lead in developing acquisition plans that
establish the date(s) for delivering complete RFC packages to the
contracting activity, and that establish the planned award dates for
individual projects.
(e) The Director, Office of Acquisition and Grants Management
monitors the OPDIV and STAFFDIV Phase II plans throughout the year to
assure that an even distribution of awards, dollar obligations, and
workload is maintained.
[49 FR 13969, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989]
Sec. 307.7103 Purpose.
The Phase II Advance Acquisition Planning mechanism serves to avoid
excessive year-end spending and distributes the contract workload as
evenly as possible over the fiscal year, and provides a mechanism for
planning at the program/acquisition operational level and a management
tool for monitoring at the program, OPDIV, and departmental levels.
Sec. 307.7104 Contracting activity actions.
The contracting activity shall take the following actions:
(a) Advise program and staff personnel of their responsibilities to
ensure that:
(1) Year-end acquisitions of unplanned items are not entered into to
use available balances of expiring appropriations (which would otherwise
revert to the Treasury);
(2) Orders for supplies, materials, and equipment are kept to the
minimum needed to carry on approved programs;
(3) Inventories are held to normal levels; and
(4) New contracts for future services and payments to contractors
are made only in accordance with established plans.
(b) Determine closing dates for purchases to be made from
appropriations ending on September 30.
(c) Expedite the preparation and processing of determinations and
findings which require the approval of the Assistant Secretary for
Management and Budget or the OPDIV head.
[[Page 41]]
PART 309_CONTRACTOR QUALIFICATIONS
Subpart 309.1_Responsible Prospective Contractors
Sec.
Sec. 309.104 Standards.
Sec. 309.104-1 General standards.
Sec. 309.105 Procedures.
Sec. 309.105-1 Obtaining information.
Subpart 309.4_Debarment, Suspension, and Ineligibility
Sec. 309.403 Definitions.
Sec. 309.404 Parties excluded from procurement programs.
Sec. 309.405 Effect of listing.
Sec. 309.405-1 Continuation of current contracts.
Sec. 309.406 Debarment.
Sec. 309.406-3 Procedures.
Sec. 309.407 Suspension.
Sec. 309.407-3 Procedures.
Sec. 309.470 Reporting of suspected causes for debarment or suspension,
or the taking of evasive actions.
Sec. 309.470-1 Situations where reports are required.
Sec. 309.470-2 Contents of reports.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13976, Apr. 9, 1984, unless otherwise noted.
Subpart 309.1_Responsible Prospective Contractors
Sec. 309.104 Standards.
Sec. 309.104-1 General standards.
(a) In determining the adequacy of a prospective contractor's
financial resources for the performance of the proposed contract,
particular attention shall be given to the ability of the contractor to
discharge its full financial responsibility for charges and losses of
Government-furnished material, when the contractor has responsibility
for such material.
(e) The prospective contractor must have an established system of
accounting and financial controls which are determined by the
contracting officer to be adequate to permit the effective
administration of the type of contract proposed, particularly if under
its terms the costs incurred are a factor in determining the amount
payable under the contract, or if advance or progress payments are
requested.
Sec. 309.105 Procedures.
Sec. 309.105-1 Obtaining information.
(b)(2)(ii) To ensure that a prospective contractor has the necessary
accounting and operational controls (see 309.104-1(e)), a written
determination must be made by the contracting officer that the
prospective contractor has an adequate accounting system for determining
costs applicable to the contract and a billing system that satisfies the
contractual payment provisions. The determination must explain the basis
for this judgment.
(A) When dealing with high risk organizations, i.e., new
organizations, those with known problems, and those with accounting
system deficiencies, the contracting officer shall use every reasonable
means available to protect the Government from the improper expenditure
of Federal funds. Actions should include at least one of the following:
preaward and postaward audits; direct identification of cost with
deliverables; billing by contract phases or tasks; fidelity bonding or
other guarantees by the parent company or principals of the
organization; increased scrutiny of vouchers and financial reports; and
frequent site visits to verify the incurrence of specific costs and the
relationship of technical progress with the amount billed.
(B) If a prospective contractor's accounting or billing system (or
both) is determined to be inadequate, corrective action must be taken
before that organization is awarded a contract. When corrective action
cannot be completed until after the award and the contracting officer
determines that the award must be made, the contracting officer shall
consult with the cognizant cost advisor and take the appropriate actions
set forth in FAR 16.104 to ensure that the Government's interests will
be protected and the contract will be adequately costed and
administered. Awards made under the preceding condition must be approved
in writing by the principal official responsible for acquisition.
[[Page 42]]
Subpart 309.4_Debarment, Suspension, and Ineligibility
Source: 50 FR 7780, Feb. 26, 1985, unless otherwise noted.
Sec. 309.403 Definitions.
Acquiring agency's head or a designee, as used in the FAR, shall
mean, unless otherwise stated in this subpart, the head of the
contracting activity. Acting in the capacity of the acquiring agency's
head, the head of the contracting activity may make the required
justifications or determinations, and take the necessary actions,
specified in FAR 9.405, 9.406, and 9.407 for his or her respective
activity, but only after obtaining the approval of the debarring or
suspending official, as the case may be.
Debarring official means the Assistant Secretary for Management and
Budget, or his/her designee.
Initiating official means either the contracting officer, the head
of the contracting activity, the Deputy Assistant Secretary for
Management and Acquisition, or the Inspector General.
Suspending official means the Assistant Secretary for Management and
Budget, or his/her designee.
[50 FR 7780, Feb. 26, 1985, as amended at 54 FR 24343, June 7, 1989; 54
FR 43965, Oct. 30, 1989]
Sec. 309.404 Parties excluded from procurement programs.
(c) The Office of Management and Acquisition (OMAC) shall perform
the actions required by FAR 9.404(c).
(4) OMAC shall maintain all documentation submitted by the
initiating official recommending the debarment or suspension action and
all correspondence and other pertinent documentation generated during
the OMAC review.
[50 FR 7780, Feb. 26, 1985, as amended at 54 FR 24343, June 7, 1989; 54
FR 43966, Oct. 30, 1989]
Sec. 309.405 Effect of listing.
(a) The head of the contracting activity may, with the concurrence
of the debarring or suspending official, make the determinations
referenced in FAR 9.405(a), regarding contracts for their respective
activities.
(1) If a contracting officer considers it necessary to award a
contract, or consent to a subcontract with a debarred or suspended
contractor, the contracting officer shall prepare a determination,
including all pertinent documentation, and submit it through acquisition
channels to the head of the contracting activity. The documentation must
include the date by which approval is required and a compelling reason
for the proposed action. Some examples of circumstances that may
constitute a compelling reason for the award to, or consent to a
subcontract with, a debarred or suspended contractor include:
(i) The property or services to be acquired are available only from
the listed contractor;
(ii) The urgency of the requirement dictates that the Department
deal with the listed contractor; or
(iii) There are other compelling reasons which require business
dealings with the listed contractor.
(2) If the head of the contracting activity decides to approve the
requested action, he/she shall request the concurrence of the debarring
or suspending official and, if given, shall, in writing, inform the
contracting officer of the decision within the required time period.
Sec. 309.405-1 Continuation of current contracts.
(a) Notwithstanding the debarment or suspension of a contractor,
contracting officers may continue contracts or subcontracts in existence
at the time the contractor was debarred or suspended, unless the head of
the contracting activity or debarring or suspending official directs
otherwise. A decision as to the type of termination action, if any, to
be taken should be made only after review by the awarding activity's
contracting and technical personnel. The contracting officer shall
coordinate any termination with the Office of the General Counsel to
ensure the propriety of the proposed action.
(b) Contracting officers shall not renew the current contracts of
debarred or suspended contractors, or otherwise extend their duration,
unless
[[Page 43]]
the head of the contracting activity determines to do so, with the
concurrence of the debarring or suspending official. The contracting
officer shall prepare a determination meeting the requirements of
309.405(a) and submit it, through acquisition channels, to the head of
the contracting activity. If the head of the contracting activity agrees
with the determination, he/she shall obtain the concurrence of the
debarring or suspending official.
Sec. 309.406 Debarment.
Sec. 309.406-3 Procedures.
(a) Investigation and referral. Whenever an apparent cause for
debarment becomes known to an initiating official, that person shall
prepare a report incorporating the information required by 309.470-2, if
known, and forward it through appropriate channels, with a written
recommendation, to the debarring official. Contracting officers shall
forward their reports in accordance with 309.470-1. The debarring
official shall initiate an investigation through such means as he/she
deems appropriate.
(b) Decisionmaking process. The debarring official shall review the
results of the investigation, if any, and make a written determination
whether or not debarment procedures are to be commenced. A copy of the
determination shall be promptly sent through appropriate channels to the
initiating official, and the contracting officer, if necessary. If the
debarring official determines to commence debarment procedures, he/she
shall, after consultation with the Office of the General Counsel, notify
the contractor in accordance with FAR 9.406-3(c). If the proposed action
is not based on a conviction or judgment and the contractor's submission
in response to the notice raises a genuine dispute over facts material
to the proposed debarment, the debarring official shall arrange for
fact-finding hearings and take the necessary actions specified in FAR
9.406-3(b)(2). The debarring official shall also ensure that written
findings of fact are prepared, and shall base the debarment decision on
the facts as found, after considering information and argument submitted
by the contractor and any other information in the administrative
record. The Office of the General Counsel shall represent the Department
at any fact-finding hearing and may present witnesses for HHS and
question any witnesses presented by the contractor.
Sec. 309.407 Suspension.
Sec. 309.407-3 Procedures.
(a) Investigation and referral. Whenever an apparent cause for
suspension becomes known to an initiating official, that person shall
prepare a report incorporating the information required by 309.470-2, if
known, and forward it through appropriate channels, with a written
recommendation, to the suspending official. Contracting officers shall
forward their reports in accordance with 309.470-1. The suspending
official shall initiate an investigation through such means as he/she
deems appropriate.
(b) Decisionmaking process. The suspending official shall review the
results of the investigation, if any, and make a written determination
whether or not suspension should be imposed. A copy of this
determination shall be promptly sent through appropriate channels to the
initiating official and the contracting officer, if necessary. If the
suspending official determines to impose suspension, he/she shall, after
consultation with the Office of the General Counsel, notify the
contractor in accordance with FAR 9.407-3(c). If the action is not based
on an indictment and, subject to the provisions of FAR 9.407-3(b)(2),
the contractor's submission in response to the notice raises a genuine
dispute over facts material to the suspension, the suspending official
shall, after suspension has been imposed, arrange for fact-finding
hearings and take the necessary actions specified in FAR 9.407-3(b)(2).
Sec. 309.470 Reporting of suspected causes for debarment or suspension,
or the taking of evasive actions.
Sec. 309.470-1 Situations where reports are required.
A report incorporating the information required by 309.470-2 shall
be forwarded, in duplicate, by the contracting officer through
acquisition channels to the OMAC when--
[[Page 44]]
(a) A contractor has committed, or is suspected of having committed,
any of the acts described in FAR 9.406-2 or FAR 9.407-2; or
(b) A contractor is suspected of attempting to evade the
prohibitions of debarment or suspension imposed under this regulation,
or any other comparable regulation, by changes of address, multiple
addresses, formation of new companies, or by other devices.
[50 FR 7780, Feb. 26, 1985, as amended at 54 FR 24343, June 7, 1989]
Sec. 309.470-2 Contents of reports.
Each report prepared under 309.470-1 shall be coordinated with the
Office of the General Counsel and shall include the following
information, where available:
(a) Name and address of contractor.
(b) Name of the principal officers, partners, owners, or managers.
(c) All known affiliates, subsidiaries, or parent firms, and the
nature of the affiliation.
(d) Description of the contract or contracts concerned, including
the contract number, and office identifying numbers or symbols, the
amount of each contract, the amount paid the contractor and the amount
still due, and the percentage of work completed and to be completed.
(e) The status of vouchers.
(f) Whether contract funds have been assigned pursuant to the
Assignment of Claims Act, as amended, 31 U.S.C. 3727, 41 U.S.C. 15, and,
if so assigned, the name and address of the assignee and a copy of the
assignment.
(g) Whether any other contracts are outstanding with the contractor
or any affiliates, and, if so, the amount of such contracts, whether
these funds have been assigned pursuant to the Assignment of Claims Act,
as amended, 31 U.S.C. 3727, 41 U.S.C. 15, and the amounts paid or due on
such contracts.
(h) A complete summary of all available pertinent evidence.
(i) A recommendation as to the continuation of current contracts.
(j) An estimate of damages, if any, sustained by the Government as a
result of the action of the contractor, including an explanation of the
method used in making the estimate.
(k) The comments and recommendations of the contracting officer and
statements regarding whether the contractor should be suspended or
debarred, whether any limitations should be applied to such action, and
the period of any proposed debarment.
(l) As an enclosure, a copy of the contract(s) or pertinent excerpts
therefrom, appropriate exhibits, testimony or statements of witnesses,
copies of assignments, and other relevant documentation or a written
summary of any information for which documentation is not available.
[[Page 45]]
SUBCHAPTER C_CONTRACTING METHODS AND CONTRACT TYPES
PART 313_SMALL PURCHASE AND OTHER SIMPLIFIED PURCHASE PROCEDURES
Subpart 313.1_General
Sec.
Sec. 313.101 Definitions.
Sec. 313.104 Procedures.
Sec. 313.105 Small business-small purchase set-aside.
Sec. 313.106 Competition and price reasonableness.
Sec. 313.107 Solicitation and evaluation of quotations.
Subpart 313.2_Blanket Purchase Agreements
Sec. 313.201 General.
Sec. 313.204 Purchases under Blanket Purchase Agreements.
Subpart 313.4_Imprest Fund
Sec. 313.403 Agency responsibilities.
Subpart 313.5_Purchase Orders
Sec. 313.505 Purchase order and related forms.
Sec. 313.505-3 Standard Form 44, Purchase Order--Invoice--Voucher.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 13977, Apr. 9, 1984, unless otherwise noted.
Subpart 313.1_General
Sec. 313.101 Definitions.
``Small purchase procedures''
(d) Acquisition of architect-engineer professional services of any
dollar amount.
Sec. 313.104 Procedures.
(i) Small purchase methods are designed to acquire defined, off-the-
shelf, standard supplies, equipment, or services which may be awarded on
the basis of a fixed price quotation. Small purchase methods should not
be used to acquire R & D, complex studies, services, and the like (which
require judgmental technical evaluations and involve negotiations) where
the award cannot be confidently made on the low price. Where
requirements are not suitable for accomplishment using small purchase
methods, more formal negotiation methods or sealed bidding should be
used.
(j) Small purchases accomplished in accordance with this part may
not be awarded on a cost-reimbursement basis.
(k) Small purchase methods should be used with great prudence for
the acquisition of consultants to avoid the increased possibility of
using consultants in an improper personal services capacity.
[49 FR 13977, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 53 FR 15563, May 2, 1988]
Sec. 313.105 Small business-small purchase set-aside.
(d)(2) The contracting officer shall consult with the small and
disadvantaged business utilization specialist (SADBUS) to determine
whether small business sources are known by the SADBUS before
determining not to proceed with the small business-small purchase set-
aside. Coordination with the SADBUS is not required for small purchases
at or below ten percent of the small purchase limitation.
[57 FR 11689, Apr. 7, 1992]
Sec. 313.106 Competition and price reasonableness.
(a) Purchases not over 10 percent of the small purchase limitation.
Purchases not exceeding this limit are exempt from the documentary
requirements of FAR Subpart 6.3 and Subpart 306.3. However, purchases
shall not be made repetitively from one source except for reasons which
clearly and convincingly justify other than full and open competition
(see FAR Subpart 6.3).
(b) Purchases over 10 percent of the small purchase limitation.
(4)(i)(D) Women-owned small business.
(c) Data to support small purchases over 10 percent of the small
purchase limitation.
[[Page 46]]
(2) Purchases ranging in excess of 10 percent of the small purchase
limitation up to and including the small purchase limitation which are
made without full and open competition require justification as to why
competition was not obtained. The justification, which may be in the
form of a paragraph or paragraphs in the request for contract or
requisition, must address the considerations in FAR Subpart 6.3 and
Subpart 306.3. The contracting officer may approve or disapprove the
justification. Award of the contract or purchase order by the
contracting officer shall constitute approval of the justification (see
306.304(a)(1)).
[49 FR 13977, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 56 FR 47002, Sept. 17, 1991]
Sec. 313.107 Solicitation and evaluation of quotations.
(e) Amendments. (1) If after the issuance of a request for
quotations but before the closing date of their receipt, it becomes
necessary (i) to make significant changes in the quantity,
specifications, or delivery schedule, (ii) to make any change in the
closing date, or (iii) to correct a defect or ambiguity, the change
shall be accomplished by issuance of an amendment to the request.
Requests for quotations using the Standard Form 18 may be amended by
letter. Oral requests for quotations may be amended orally.
(2) When it is considered necessary to issue an amendment to a
request for quotations, the period of time remaining before closing and
the need for extending this period by postponing the time set for
closing must be considered. Where only a short time remains before the
time set for closing, extension of time may be made by telegram or
telephone. This notification should be confirmed in the amendment.
(3) Any information given to one potential quoter concerning a
request for quotations shall be furnished promptly to all other
potential quoters in an amendment to the request, if the information is
necessary to potential quoters in submitting quotations, or if the lack
of the information would be prejudicial to uninformed potential quoters.
[49 FR 13977, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984;
56 FR 47003, Sept. 17, 1991]
Subpart 313.2_Blanket Purchase Agreements
Sec. 313.201 General.
(e) Each blanket purchase arrangement (BPA) shall be documented by
issuance of a contractual instrument which is appropriately numbered.
Sec. 313.204 Purchases under Blanket Purchase Agreements.
(e)(5) Delivery documents, invoices, etc. signed by the Government
employee receiving the item or service, will be forwarded to the fiscal
office or other paying office as designated by the OPDIV. Payment will
be made on the basis of the signed document, invoice, etc. Contracting
offices will ensure that established procedures allowing for
availability of funds are in effect prior to placement of orders.
[49 FR 13977, Apr. 9, 1984, as amended at 56 FR 47003, Sept. 17, 1991]
Subpart 313.4_Imprest Fund
Sec. 313.403 Agency responsibilities.
(a) The amount of each imprest fund shall be established on the
basis of the estimated monthly payment and the need for replenishment. A
review shall be made by the responsible official at least quarterly to
insure that the fund is not in excess of needs, and appropriate
adjustments are made accordingly.
(c) Requests to establish imprest funds shall be made to the
responsible fiscal office. At larger activities where the cashier may
not be conveniently located near the purchasing office, a Class C
Cashier may be installed in the purchasing office. Documentation of cash
purchases shall be in accordance with instructions contained in the HHS
Voucher Audit Manual Part 1, Chapter 1-10.
[[Page 47]]
Subpart 313.5_Purchase Orders
Sec. 13.505 Purchase order and related forms.
Sec. 313.505-3 Standard Form 44, Purchase Order--Invoice--Voucher.
(d) Since the Standard Form 44 is an accountable form, a record
shall be maintained of serial numbers of the form, to whom issued, and
date issued. SF-44's shall be kept under adequate lock and key to
prevent unauthorized use. A reservation of funds shall be established to
cover total anticipated expenditures prior to use of the SF-44.
PART 314_FORMAL ADVERTISING
Subpart 314.2_Solicitation of Bids
Sec.
Sec. 314.202-7 Facsimile bids.
Sec. 314.213 Annual submission of representations and certifications.
Subpart 314.4_Opening of Bids and Award of Contract
Sec. 314.404 Rejection of bids.
Sec. 314.404-1 Cancellation of invitations after opening.
Sec. 314.406 Mistakes in bids.
Sec. 314.406-3 Other mistakes disclosed before award.
Sec. 314.406-4 Mistakes after award.
Sec. 314.407 Award.
Sec. 314.407-8 Protests against award.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Subpart 314.2_Solicitation of Bids
Source: 55 FR 13536, Apr. 11, 1990, unless otherwise noted.
Sec. 314.202-7 Facsimile bids.
The principal official responsible for acquisition (PORA) shall
determine whether to allow the use of facsimile bids. If the PORA
decides to allow the use of facsimile bids, internal procedures shall be
developed, in accordance with the FAR, to ensure uniform processing and
control.
Sec. 314.213 Annual submission of representations and certifications.
Each principal official responsible for acquisition (PORA) shall
determine whether to allow the use of the annual submission of
representations and certifications by bidders. If allowed, the
provisions of FAR 14.213 shall be followed.
Subpart 314.4_Opening of Bids and Award of Contract
Sec. 314.404 Rejection of bids.
Sec. 314.404-1 Cancellation of invitations after opening.
(c) The chief of the contracting office (CCO) shall make the
determination required by FAR 14.404-1(c).
(e) The CCO shall make the referenced determination.
[51 FR 44294, Dec. 9, 1986]
Sec. 314.406 Mistakes in bids.
Sec. 314.406-3 Other mistakes disclosed before award.
(e) Authority has been delegated to the Protest Control Officer,
Division of Acquisition Policy, Office of Acquisition and Grants
Management (OAGM) to make administrative determinations in connection
with mistakes in bid alleged after opening and before award. This
authority may not be redelegated.
(f) Each proposed determination shall have the concurrence of the
Chief, Business Law Branch, Business and Administrative Law Division,
Office of General Counsel.
(g)(3) The data required by FAR 14.406-3(g)(3) shall be marked
``IMMEDIATE ACTION--MISTAKE IN BID'' and submitted through acquisition
channels to the Protest Control Officer, Division of Acquisition Policy,
Office of Acquisition and Grants Management (OAGM). The file shall be
assembled in an orderly manner and shall include an index of enclosures.
A single copy of the file is sufficient.
(4) Since examination of evidence is necessary to determine the
proper course of action to be taken, no action will be taken on cases
referred by telephone or telegraph.
(5) Where the evidence submitted by the bidder is incomplete or in
need of clarification, the contracting officer shall document the file
to indicate the effort made to obtain clear and convincing evidence to
support the alleged mistake. Since the burden of providing
[[Page 48]]
such evidence lies with the bidder-claimant, repeated efforts to obtain
such information are neither necessary nor desirable.
(i) Doubtful cases shall not be submitted by the contracting officer
directly to the Comptroller General, but shall be submitted as indicated
in 314.406-3(g)(3).
[49 FR 13978, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989]
Sec. 314.406-4 Mistakes after award.
(c) Authority has been delegated to the Protest Control Officer,
Division of Acquisition Policy, OAGM to make administrative
determinations in connection with mistakes in bid alleged after award.
This authority may not be redelegated.
(d) Each proposed determination shall have the concurrence of the
Chief, Business Law Branch, Business and Administrative Law Division,
Office of General Counsel.
(2) The data required by FAR 14.406-4(e)(2) shall be marked
``IMMEDIATE ACTION--MISTAKE IN BID'' and submitted as prescribed in
314.406-3(g)(3).
[49 FR 13978, Apr. 9, 1984, as amended at 50 FR 23126, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989]
Sec. 314.407 Award.
Sec. 314.407-8 Protests against award.
See Subpart 333.1--Protests.
[50 FR 23129, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
PART 315_CONTRACTING BY NEGOTIATION
Subpart 315.1_General Requirements for Negotiation
Sec.
Sec. 315.103 Converting from sealed bidding to negotiation procedures.
Subpart 315.4_Solicitation and Receipt of Proposals and Quotations
Sec. 315.402 General.
Sec. 315.404 Presolicitation notices and conferences.
Sec. 315.405 Solicitations for information or planning purposes.
Sec. 315.405-1 General.
Sec. 315.406 Preparing requests for proposals (RFP's) and requests for
quotations (RFQ's).
Sec. 315.406-1 Uniform contract format.
Sec. 315.406-2 Part I--The Schedule.
Sec. 315.406-3 Part II--Contract clauses.
Sec. 315.406-5 Part IV--Representations and instructions.
Sec. 315.407 Solicitation provisions.
Sec. 315.408 Issuing solicitations.
Sec. 315.409 Pre-proposal conferences.
Sec. 315.410 Amendment of solicitations before closing date.
Sec. 315.413 Disclosure and use of information before award.
Sec. 315.413-1 Alternate I.
Sec. 315.413-2 Alternate II.
Sec. 315.470 Review of RFP.
Sec. 315.471 Annual submission of representations and certifications.
Subpart 315.5_Unsolicited Proposals
Sec. 315.505 Content of unsolicited proposals.
Sec. 315.506 Agency procedures.
Sec. 315.506-1 Receipt and initial review.
Sec. 315.509 Limited use of data.
Subpart 315.6_Source Selection
Sec. 315.602 Applicability.
Sec. 315.604 Responsibilities.
Sec. 315.605 Evaluation factors.
Sec. 315.607 Disclosure of mistakes before award.
Sec. 315.608 Proposal evaluation.
Sec. 315.608-70 Technical evaluation plan.
Sec. 315.608-71 Technical evaluation panel.
Sec. 315.608-72 Procedures for handling and disclosing proposals.
Sec. 315.608-73 Receipt of proposals.
Sec. 315.608-74 Convening the technical evaluation panel.
Sec. 315.608-75 Rating and ranking of proposals.
Sec. 315.608-76 Technical evaluation report.
Sec. 315.608-77 Evaluation of business proposals.
Sec. 315.609 Competitive range.
Sec. 315.610 Written or oral discussions.
Sec. 315.611 Best and final offers.
Sec. 315.670 Negotiation with the selected source.
Sec. 315.671 Post negotiation contract preparation and award.
Sec. 315.672 Preparation of negotiation memorandum.
Subpart 315.8_Price Negotiation
Sec. 315.804 Cost or pricing data.
Sec. 315.804-3 Exemptions from or waiver of submission of certified
cost or pricing data.
Sec. 315.805 Proposal analysis.
Sec. 315.805-5 Field pricing support.
Subpart 315.9_Profit
Sec. 315.900 Scope of subpart.
Sec. 315.905-70 Structured approach.
Sec. 315.905-71 Profit factors.
[[Page 49]]
Sec. 315.905-72 Contractor effort.
Sec. 315.905-73 Other factors.
Sec. 315.905-74 Facilities capital cost of money.
Subpart 315.10_Preaward, Award, and Postaward Notifications, Protests,
and Mistakes
Sec. 315.1000 General.
Sec. 315.1003 Debriefing of unsuccessful offerors.
Sec. 315.1004 Protests against award.
Sec. 315.1005 Discovery of mistakes.
Subpart 315.70_Requests for Contract
Sec. 315.7000 Scope of subpart.
Sec. 315.7001 General.
Sec. 315.7002 Procedures.
Sec. 315.7003 Responsibilities.
Sec. 315.7004 Transmittal.
Sec. 315.7005 Format and content.
Sec. 315.7006 Review.
Authority: 5 U.S.C. 301; 40 U.S.C. 486cc).
Source: 49 FR 13979, Apr. 9, 1984, unless otherwise noted.
Subpart 315.1_General Requirements for Negotiation
Sec. 315.103 Converting from sealed bidding to negotiation procedures.
The chief of the contracting office has the authority to make the
determination referenced in FAR 15.103.
[51 FR 44294, Dec. 9, 1986]
Subpart 315.4_Solicitation and Receipt of Proposals and Quotations
Sec. 315.402 General.
(i) The principal official responsible for acquisition (PORA) shall
determine whether to allow the use of facsimile proposals. If the PORA
decides to allow the use of facsimile proposals, internal procedures
shall be developed, in accordance with the FAR, to ensure uniform
processing and control.
[55 FR 13536, Apr. 11, 1990]
Sec. 315.404 Presolicitation notices and conferences.
(c) Presolicitation conferences. (1) The presolicitation conference
may only be used when approved by the chief of the contracting office.
Sec. 315.405 Solicitations for information or planning purposes.
Sec. 315.405-1 General.
The determination approval required by FAR 15.405-1 that a
solicitation for information or planning purposes is appropriate shall
be made by the chief of the contracting office.
Sec. 315.406 Preparing requests for proposals (RFP's) and requests for
quotations (RFQ's).
(a) The contracting officer is responsible for preparing the RFP
with the assistance of the project officer. The purpose of the RFP is to
convey information that prospective offerors need to prepare a proposal.
The RFP includes the statement of work and the terms, conditions and
provisions that will form the basis for the final definitive contract.
It specifies all the information that prospective offerors must furnish
to permit a meaningful and equitable evaluation of their offers. The RFP
must be clear, complete, accurate, and consistent with the requirements
of the acquisition so that it provides all who receive it with the same
understanding of the requirements. Much of the information in the RFP is
either derived directly from the request for contract or is otherwise
furnished by the project officer. Therefore, it is important that the
project officer develop a meaningful request for contract and supporting
documentation during the initial presolicitation phase which will fully
satisfy program needs and objectives when included in the RFP (see
subpart 315.70).
(b) Careful drafting of the RFP is vital to the proper working of
the competitive process. The success of the acquisition depends, in
large measure, on how well the work to be performed and the basic ground
rules under which the competition will be conducted are described in the
RFP. Particular effort must be made to develop a comprehensive and
accurate statement of work (see 307.105-3 and FAR 35.007) to prevent
ambiguities and to avoid misunderstandings which might otherwise surface
at later stages of the acquisition.
(c) Care should be taken to avoid conflicting statements in the RFP.
Clear
[[Page 50]]
distinctions must be made as to the contents and purpose of the
statement of work, the instructions to offerors, and the evaluation
criteria. Briefly:
(1) The statement of work must clearly specify the work to be done
by the resultant contractor (or, if it is an R & D acquisition, present
a clear statement of the requirements, see FAR part 35);
(2) The general, technical, and business instructions must delineate
all the essential information prospective offerors need to know in
preparing their proposals (see 315.406-5(b)); and
(3) The evaluation criteria must clearly indicate the technical,
management, personnel, and cost or pricing factors which are to be the
major considerations in selecting the successful offeror (see 315.406-
5(c)).
(d) The RFP must require that proposals be submitted in two parts--a
``Technical Proposal'' and a ``Business Proposal.'' Each part is to be
separate and complete in itself so that evaluation of one may be
accomplished independently of the other.
(e) The technical and business proposal instructions of the RFP must
provide all the information deemed essential for proper evaluation of
the proposals so that all prospective offerors are aware of all
requirements, and so that differences in proposals will reflect each
offeror's individual approach to the clear and unambiguous requirements
and criteria stated in the RFP.
(f) The RFP must inform prospective offerors of all evaluation
criteria and of the relative importance or weight attached to each
criterion. Evaluation criteria must be described sufficiently enough in
the RFP to inform prospective offerors of the significant matters which
should be addressed in the proposals. Only the evaluation criteria set
forth in the RFP shall be used in the evaluation of proposals, and the
criteria can only be modified by a formal amendment to the RFP.
(g) Generally, the RFP will provide that the technical proposal not
contain any reference to cost. However, resource information, such as
data concerning labor hours and categories, materials, subcontracts,
travel, computer time, etc., must be included in the technical proposal
so that the offeror's understanding of the scope of work may be
evaluated.
(h) The project officer should be offered the opportunity to review
the finalized RFP before it is printed and released.
Sec. 315.406-1 Uniform contract format.
The uniform contract format specified in FAR 15.406-1 and Table 15-1
shall be used by all contracting activities of the Department.
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 315.406-2 Part I--The Schedule.
(a) Section A, Solicitation/contract form.
(3) Contracting activities are encouraged to use SF 33 for RFPs. In
those instances where a contracting activity believes the SF 33 is not
appropriate, a transmittal letter may be used. However, it is essential
that the transmittal letter contain the pertinent information that must
be brought to the attention of prospective offerors, so the information
contained in FAR 15.406-2(a)(3) shall be included in it. The transmittal
letter should also contain reference to the solicitation provision
``Late Submissions, Modifications, and Withdrawals of Proposals or
Quotations'' and stress the importance of timeliness. The last paragraph
of the transmittal letter should provide the name and complete telephone
number of a contract specialist who can provide information concerning
the solicitation.
[49 FR 13979, Apr. 9, 1984, as amended 54 FR 24343, June 7, 1989]
Sec. 315.406-3 Part II--Contract clauses.
Section I, Contract clauses.
This section should contain all the pertinent contract clauses
applicable to the acquisition, to include those contained in the general
provisions, any additions or modifications to the general provisions,
and special contract clauses (see part 352--Solicitation Provisions and
Contract Clauses).
[[Page 51]]
Sec. 315.406-5 Part IV--Representations and instructions.
(a) Section K, Representations, certifications, and other statements
of offerors or quoters.
(1) This section shall begin with the following statements and
continue with the applicable representations and certifications:
To Be Completed by the Offeror: (The Representations and
Certifications must be executed by an individual authorized to bind the
offeror.)
The offeror makes the following Representations and Certifications
as part of its proposal (check or complete all appropriate boxes or
blanks on the following pages).
Name of offeror ____
RFP No. ___
Signature of authorized individual ____
Date ___
Type name of authorized individual ____
Note: The penalty for making false statements in offers is
prescribed in 18 U.S.C. 1001.
(2) The contracting officer shall insert in all solicitations the
representations and certifications at--
(i) FAR 52.203-2, Certificate of Independent Price Determination;
(ii) FAR 52.203-4, Contingent Fee Representation and Agreement;
(iii) FAR 52.204-3, Taxpayer Identification;
(iv) FAR 52.209-5, Certification Regarding Debarment, Suspension,
Proposed Debarment, and Other Responsibility Matters;
(v) FAR 52.215-6, Type of Business Organization;
(vi) FAR 52.215-20, Place of Performance;
(vii) FAR 52.219-1, Small Business Concern Representation;
(viii) FAR 52.219-2, Small Disadvantaged Business Concern
Representation;
(ix) FAR 52.219-3, Women-Owned Small Business Representation;
(x) FAR 52.222-19, Walsh-Healy Public Contracts Act Representation;
(xi) FAR 52.222-21, Certification of Nonsegregated Facilities;
(xii) FAR 52.222-22, Previous Contracts and Compliance Reports;
(xiii) FAR 52.222-25, Affirmative Action Compliance;
(xiv) FAR 52.223-1, Clean Air and Water Certification;
(xv) FAR 52.223-5, Certification Regarding a Drug-Free Workplace;
(xvi) FAR 52.225-1, Buy American Certification;
(xvii) FAR 52.225-12, Notice of Restrictions on Contracting With
Sanctioned Persons;
(xviii) FAR 52.230-2, Cost Accounting Standards Notices and
Certification (Nondefense); and
(xix) FAR 15.804-4, Certificate of Current Cost or Pricing Data; and
Note: The following paragraph shall be inserted between the title
and text of this certificate:
(When a certificate of cost or pricing data is required to be
submitted in accordance with Federal Acquisition Regulation (FAR)
15.804-4, the Contracting Officer will request that the offeror
complete, execute, and submit to the Contracting Officer a certification
in the format shown in the following Certificate of Current Cost or
Pricing Data. The certification shall be submitted only at the time
negotiations are concluded. Offerors should complete the certificate set
forth below and return it when requested by the Contracting Officer.)
(xx) 352.215-71, Employer's Identification Number.
(b) Section L, Instructions, conditions, and notices to offerors and
quoters. This section shall be comprised of the general instructions,
technical proposal instructions, and business proposal instructions, as
well as pertinent solicitation provisions (see FAR 15.407).
(1) General instructions.
(i) The general instructions provide basic guidance to prospective
offerors that informs them of what is required in the preparation and
submission of proposals. The general instructions must include the
following statements and any instructions pertinent to the individual
acquisition and applicable requirements of the OPDIV, agency, or
regional office.
General Instructions
The following instructions establish the acceptable minimum
requirements for the format and content of proposals:
Your special attention is directed to the requirements for technical
and business proposals to be submitted in accordance with these
instructions.
Any resultant contract shall include the general provisions
applicable to the selected offeror's organization and type of contract
awarded. Copies of general provisions may be
[[Page 52]]
obtained by contacting the contracting officer. Any additional clauses
required by public law, executive order, or acquisition regulations, in
effect at the time of execution of the proposed contract, will be
included.
The proposal must be prepared in two parts: a ``Technical Proposal''
and a ``Business Proposal.'' Each of the parts shall be separate and
complete in itself so that evaluation of one may be accomplished
independently of evaluation of the other. The technical proposal must
not contain reference to cost; however, resource information, such as
data concerning labor hours and categories, materials, subcontracts,
etc., must be contained in the technical proposal so that your
understanding of the scope of the work may be evaluated. It must
disclose your technical approach in sufficient detail to provide a clear
and concise presentation that includes, but is not limited to, the
requirements of the technical proposal instructions.
The proposal must be signed by an official authorized to bind your
organization. (Number) copies of your technical proposal and (number)
copies of your business proposal must be submitted to: (Insert complete
address indicating where the proposal is to be sent and how it is to be
marked. Provide similar information for hand-delivered proposals.)
You may, at your discretion, submit alternate proposals, or
proposals which deviate from the requirements; provided, that you also
submit a proposal for performance of the work as specified in the
statement of work. These proposals may be considered if overall
performance would be improved or not compromised, and if they are in the
best interest of the Government. Alternate proposals, or deviations from
any requirements of this RFP, must be clearly identified.
The Government will evaluate proposals in accordance with the
evaluation criteria set forth in Section M of this request for
proposals.
It is understood that your proposal will become part of the official
contract file.
The RFP does not commit the Government to pay any cost for the
preparation and submission of a proposal. In addition, the Contracting
Officer is the only individual who can legally commit the Government to
the expenditure of public funds in connection with this proposed
acquisition.
(ii) Include either of the following in the General Instructions if
prospective offerors are to be informed of the Government's estimate of
the level of effort necessary to accomplish the requirement:
The Government considers the level of effort to perform the
resultant contract should take the following staff-hours: (insert a
breakdown of the Government's staff-hour estimates by categories). These
estimates are furnished for the offeror's information only and are not
to be considered restrictive for proposal purposes; or
To assist you in the preparation of your proposal, the Government
considers the effort to perform this contract to be approximately
(insert the total number) staff-hours. This number is furnished for the
offeror's information only and is not considered restrictive for
proposal purposes.
Note: The first paragraph should only be used for term (e.g. level
of effort task order), rather than completion type, contracts.)
(iii) If the proposed contract will involve performance or services
on a Government installation, insert the following in the General
Instructions:
Offerors are urged and expected to inspect the site where services
are to be performed and to satisfy themselves as to all general and
local conditions that may affect the cost of performance of the
contract, to the extent such information is reasonably obtainable. In no
event will failure to inspect the site constitute grounds for claims by
the contractor after the award of a contract.
(iv) If reference material is to be provided for use in preparation
of proposals, insert either of the following:
To assist offerors in preparing their proposals, reference material
consisting of (insert title or description of publications,
specifications, drawings, reports, or other documentation being made
available as reference material) will be available for inspection at
(insert name and address of building and room number).
Offerors are expected to examine all reference material prior to
preparation and submission of their proposals. Failure to do so will be
at the offeror's risk; or
To assist offerors in preparing their proposals, reference material
consisting of (insert title or description of publications,
specifications, drawings, reports, or other documentation being
furnished as reference material) is enclosed. Offerors are expected to
examine all reference material prior to preparation and submission of
their proposal. Failure to do so will be at the offeror's risk.
(v) If the reference material being provided is to be returned to
the Government, include the following statement:
All reference material furnished hereunder shall be returned within
(insert number) days after the submission of proposals to (insert name
and address of building and room number).
[[Page 53]]
(vi) If an incentive type contract is being considered, a notice to
the offeror of the Government's desire as to use of incentives
considered applicable, objectives of the incentive performance goals,
schedules, milestones, critical delivery parameters, and similar
information must be included.
(2) Technical proposal instructions.
(i) The technical proposal instructions should clearly and concisely
describe the information prospective offerors must provide in their
technical proposals. The instructions should address the need for
submission of a detailed work plan indicating how each aspect of the
statement of work is to be accomplished, a discussion of how the work is
to be organized, staffed, and managed, and statements of the
qualifications and experience of the prospective offeror and its key
personnel.
(ii) The technical proposal instructions must be specific enough to
convey the information the program office will require from offerors to
allow the technical proposal evaluators to determine whether a proposal
is acceptable. Therefore, it is essential that the instructions are
written to elicit the information necessary to fully address all the
elements of the work plan with particular emphasis on the evaluation
criteria, so that evaluators may readily evaluate each offer in the
pertinent areas. The instructions should not require the submission of
excessive information since this will complicate the evaluation process
and could cause unnecessary proposal preparation costs for offerors.
(iii) The technical proposal instructions should require that
technical proposals be prepared in a specified format to facilitate
evaluation. A uniform format will minimize evaluators' efforts and
should minimize the amount of extraneous and voluminous material
sometimes included in proposals.
(iv) Since specific instructions must be developed to suit the needs
of the individual acquisition, detailed guidance concerning the contents
of the technical proposal instructions is not presented here. However,
the following represents a sampling of general statements which may be
helpful in the preparation of the instructions:
Technical Proposal Instructions
Proposals which merely offer to conduct a program in accordance with
the requirements of the Government's scope of work will not be eligible
for award. You must submit an explanation of the proposed technical
approach in conjunction with the tasks to be performed in achieving the
project objectives.
A detailed work plan must be submitted indicating how each aspect of
the statement of work is to be accomplished. Your technical approach
should be in as much detail as you consider necessary to fully explain
your proposed technical approach or method. The technical proposal
should reflect a clear understanding of the nature of the work being
undertaken.
The technical proposal must include information on how the project
is to be organized, staffed, and managed. Information should be provided
which will demonstrate your understanding and management of important
events or tasks. You must explain how the management and coordination of
consultant and/or subcontractor efforts will be accomplished.
The technical proposal must include a list of names and proposed
duties of the professional personnel, consultants, and key subcontractor
employees assigned to the project. Their resumes should be included and
should contain information on education, background, recent experience,
and specific scientific or technical accomplishments. The approximate
percentage of time each individual will be available for this project
must be included. The proposed staff hours for each of the above
individuals should be allocated against each task or subtask for the
project.
The technical proposal must provide the general background,
experience, and qualifications of the organization. Similar or related
contracts, subcontracts, or grants should be included and contain the
name of the customer, contract or grant number, dollar amount, time of
performance, and the names and telephone numbers of the project officer
and contracting/grants officer.
The technical proposal must contain a discussion of present or
proposed facilities and equipment which will be used in the performance
of the contract.
The technical proposal must be prepared and submitted in the
following format:
(Provide the required format.)
(3) Business proposal instructions. Business proposal instructions
consist of cost and pricing data and administrative and management data.
(i) Cost and pricing data. Prospective offerors must be informed in
the business proposal instruction that they are
[[Page 54]]
required to submit cost or pricing information in sufficient detail to
allow a complete cost analysis. (See FAR 15.804 for requirements on cost
or pricing data.) Categories and amounts of labor, materials, travel,
computer time, overhead and other costs should be requested. Prospective
offerors are to be provided Standard Form 1411, Contract Pricing
Proposal Cover Sheet, for use in preparing the cost of pricing data, and
are to be told to submit, as a minimum, cost proposals fully supported
by cost and pricing data adequate to establish the reasonableness of the
proposed amount. Prospective offerors are to comply with the instruction
on the SF 1411 and fill in or check the appropriate boxes. In addition,
they should be informed to itemize the cost for individual elements,
each as analytical studies, reports, etc., and the estimated cost of
each phase or segment of the offered performance.
(ii) Administrative and management data.
(A) The business proposal instructions must be written so that the
contracting officer receives adequate information to evaluate each
offeror's management capability and to determine whether each offeror is
responsible. Therefore, under this section, information should be
requested to allow the contracting officer to assess the following
factors as they apply to the instant acquisition:
(1) The offeror's financial capability;
(2) The offeror's capability to meet delivery or performance
schedules;
(3) The offeror's record of past performance;
(4) The offeror's record of business integrity;
(5) The offerors's possession of necessary organization, experience,
and technical skills, or the ability to obtain them;
(6) The offeror's possession of required facilities; and
(7) Any other special consideration involved in the instant
acquisition.
In some cases, these factors may duplicate evaluation criteria and may
be adequately addressed in the technical proposal instructions. However,
the contracting officer must ensure that they are covered in both the
business proposal instructions and the technical proposal instructions.
(B) The contracting officer may determine that other administrative
data in the form of additional business or cost information is
necessary. Some examples of additional information include:
(1) A copy of the current agreement on indirect cost rates;
(2) A copy of the most recent financial statements;
(3) A discussion on the extent of proposed subcontracting with small
and disadvantaged business enterprises;
(4) A request for pricing or cost breakdown tailored to the instant
acquisition to provide information for a more thorough and complete cost
analysis; and
(5) A request for explicit instructions on pricing of options and
individual line items.
However, care should be taken to request additional information only
when necessary, to prevent excessive proposal preparation costs for
offerors.
(C) The following are required statements which must be included in
the RFP.
Your proposal must stipulate that it is predicated upon all the
terms and conditions of this RFP. In addition, it must contain a
statement to the effect that it is firm for a period of at least (insert
number) days from the date of receipt by the Government.
It is HHS policy that contractors provide all equipment and
facilities necessary for performance of contracts; however, in some
instances, an exception may be granted to furnish Government-owned
property or to authorize purchase with contract funds. If additional
equipment must be acquired, you must include in your proposal the
description and estimated cost of each item, and whether you propose to
furnish the item with your own funds.
You must identify all Government-owned property in your possession
and all property acquired from Federal funds, to which you have title,
that is proposed to be used in the performance of the prospective
contract.
The management and control of Government property must be in
accordance with HHS Publication (OS) 686 entitled, ``Contractor's Guide
for Control of Government Property (1990),'' a copy of which will be
provided upon request.
(c) Section M, Evaluation factors for award--(1) General. (i) The
evaluation criteria must be developed by the
[[Page 55]]
project officer and submitted to the contracting officer in the request
for contract (RFC) for inclusion in the RFP. Development of these
criteria and the assignment of the relative importance or weight to each
criterion require the exercise of judgment on a case-by-case basis
because they must be tailored to the requirements of the individual
acquisition. Since the criteria will serve as a standard against which
all proposals will be evaluated, it is imperative that they be chosen
carefully to emphasize those factors considered to be critical in the
selection of a contractor.
(ii) The finalized evaluation criteria and indications of their
relative importance or weights, as included in the RFP, cannot be
changed except by a formal amendment to the RFP issued by the
contracting officer. No factors other than those set forth in the RFP
shall be used in the evaluation of proposals.
(2) Review of evaluation criteria. (i) The evaluation criteria
should be reviewed by the contracting officer in terms of the work
statement. This review is not intended to dictate to the program office
or project officer, but rather to ensure that the evaluation criteria
are clear, concise, and fair so that all potential offerors are fully
aware of the bases for proposal evaluation and are given an equal
opportunity to compete.
(ii) The project officer and the contracting officer should then
review the evaluation criteria together to ascertain the following:
(A) The criteria are described in sufficient detail to provide the
offerors (and evaluators) with a total understanding of the factors to
be involved in the evaluation process;
(B) The criteria address the key programmatic concerns which the
offerors must be aware of in preparing proposals;
(C) The criteria are specifically applicable to the instant
acquisition and are not merely restatements of criteria from previous
acquisitions which are not relevant to this acquisition; and
(D) The criteria are selected to represent only the significant
areas of importance which must be emphasized rather than a multitude of
factors. (All criteria tend to lose importance if too many are included.
Using too many criteria will prove as detrimental as using too few.)
(3) Examples of topics that form a basis for evaluation criteria.
Typical examples of topics that form a basis for the development of
evaluation criteria are listed in the following paragraphs. These
examples are intended to assist in the development of actual evaluation
criteria for a specific acquisition and should only be used if they are
applicable to that acquisition. They are not to be construed as actual
examples of evaluation criteria to be included in the RFP.
(i) Understanding of the problem and statement of work;
(ii) Method of accomplishing the objectives and intent of the
statement of work;
(iii) Soundness of the scientific or technical approach for
executing the requirements of the statement of work (to include, when
applicable, preliminary layouts, sketches, diagrams, other graphic
representations, calculations, curves, and other data necessary for
presentation, substantiation, justification, or understanding of the
approach);
(iv) Special technical factors, such as experience or pertinent
novel ideas in the specific branch of science or technology involved;
(v) Feasibility and/or practicality of successfully accomplishing
the requirements (to include a statement and discussion of anticipated
major difficulties and problem areas and recommended approaches for
their resolution);
(vi) Availability of required special research, test, and other
equipment or facilities;
(vii) Managerial capability (ability to achieve delivery or
performance requirements as demonstrated by the proposed use of
management and other personnel resources, and to successfully manage the
project, including subcontractor and/or consultant efforts, if
applicable, as evidenced by the management plan and demonstrated by
previouis experience).
(viii) Availability, qualifications, experience, education, and
competence of
[[Page 56]]
professional, technical, and other personnel, to include proposed
subcontractors and consultants (as evidenced by resumes, endorsements,
and explanations of previous efforts); and
(ix) Soundness of the proposed staff time or labor hours, propriety
of personnel classifications (professional, technical, others),
necessity for type and quantity of material and facilities proposed,
validity of proposed subcontracting, and necessity of proposed travel.
(4) Relative importance or weight.
(i) A statement or indication of the relative importance or weight
must be assigned to each evaluation criterion to inform prospective
offerors (and evaluators) of the specific significance of each criterion
in comparsion to the other criteria. Similarly, if a criterion is
subdivided into parts, each of the parts must be assigned a statement or
indication of the relative importance or weight.
(ii) The two principal methods used to indicate the relative
importance or weight are the numerical score and adjective description.
The Department does not prescribe a single method for determining the
relative importance or weight, but recommends the use of the numerical
score method because it is more precise and informative. However, it is
recognized that in some instances the use of the adjective description
method be more appropriate and, hence, may be used when that
determination is made.
(iii) Cost or price is not generally included as one of the
evaluation criteria and is not assigned an indication of relative
importance or weight. However, a statement must be included in the RFP
to reflect the relationship of cost or price in comparison to the other
criteria. The contracting officer must ensure that this statement
accurately reflects the appropriate balance between cost or price and
the technical factors. The contracting officer and project officer
should work together in arriving at the final determination regarding
the relationship. The following are examples of statements that may be
used to reflect this relationship. However, since these examples
represent only the two extremes and the middle position, another
statement may be developed to reflect the relationship which applies to
the instant acquisition.
(A) You are advised that paramount consideration shall be given to
the evaluation of technical proposals rather then cost or price.
(B) You are advised that paramount consideration shall be given to
cost or price rather than the evaluation of technical proposals.
(C) You are advised that the evaluation of technical proposals and
cost or price are of approximately equal value.
[49 FR 13979, Apr. 9, 1984; 49 FR 36110, Sept. 14, 1984, as amended at
53 FR 43207, Oct. 26, 1988; 54 FR 24343, June 7, 1989; 54 FR 43966, Oct.
30, 1989; 56 FR 47003, Sept. 17, 1991]
Sec. 315.407 Solicitation provisions.
(c)(2) The referenced provision (FAR 52.215-6, Type of Business
Organization) is a representation, has been included under Section K
(see 315.406-5(a)(2)(iii)), and need not be restated again.
(8) The provision at 352.215-12 shall be used in place of that
specified at FAR 52.215-12.
(g) The referenced provision (FAR 52.215-20, Place of Performance)
is to be considered a certification and is included under section K (see
315.406-5(a)(2)(iv)); it need not be restated again.
(n) The contracting officer shall insert the provision at FAR
52.233-2, Service of Protest, in solicitations as required by FAR
33.106(a).
[49 FR 13979, Apr. 9, 1984, as amended at 54 FR 43966, Oct. 30, 1989; 57
FR 11690, Apr. 7, 1992]
Sec. 315.408 Issuing solicitations.
The minimum proposal preparation or response time between the date
of distribution of a RFP and the date set for receipt of proposals shall
not be less than 30 calendar days.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 43208, Oct. 26, 1988]
Sec. 315.409 Pre-proposal conferences.
If a pre-proposal conference is to be held, the provision at
352.215-72 shall be included in the solicitation.
[[Page 57]]
Sec. 315.410 Amendment of solicitations before closing date.
For additional information on amendments to solicitations, see FAR
15.606.
Sec. 315.413 Disclosure and use of information before award.
Sec. 315.413-1 Alternate I.
The Department shall not use Alternate I procedures.
Sec. 315.413-2 Alternate II.
The Department shall use the Alternate II procedures as modified in
this subsection and shall use the provision at 352.215-12, Restriction
on Disclosure and Use of Data, rather than the similar provision at FAR
15.215-12 (see 315.407(c)(8)). Any reference in the FAR to the provision
at FAR 52.215-12 shall apply to the provision at 352.215-12.
(b) The term data, as used in this section and in 352.215-12, refers
to trade secrets, business data, and technical data. Trade secrets,
within the meaning of 18 U.S.C. 1905, include, for example, processes,
formulas, and chemical compositions. Business data includes, for
example, commercial information, financial information, and cost and
pricing data. Technical data includes, for example, plans, designs,
suggestions, improvements and concepts.
The Department recognizes that requests for proposals may require the
offeror, including its prospective subcontractor(s), if any, to submit
data which the offeror does not want used or disclosed for any purpose
other than for evaluation of the proposal. Each proposal containing data
which the offeror desires to restrict must be marked on the cover sheet
by the offeror with the legend set forth at 352.215-12. Proposals, or
portions of proposals, so marked shall be handled in accordance with the
provisions of the legend.
(c) Contracting officers receiving proposals which contain
restrictive statements or legends not conforming to the referenced
provision at 352.215-12 must carefully evaluate the form and substance
of the restriction before making a determination to reject the proposal.
Deviations in form which do not compromise the Government's rights may
be accepted if approved by the activity's FOI official and the Office of
General Counsel, Business and Administrative Law Division.
(e) The Government notice shown in FAR 15.413-2(e) shall be used by
this Department and is to be placed on the cover sheet of each proposal
or quotation upon its receipt. The Government notice shall be completed
by adding the following to the end of the last sentence: ``HHSAR
paragraph 315.608-72.''
(f) The Department sometimes finds it necessary (and in some
instances is required by law) to seek evaluation of proposals outside
the Department (see 315.608(d)(6)). All conditions required by FAR
15.413-2(f) have been met and are covered in 315.608-72, Procedures for
handling and disclosing proposals. In regard to item (f)(1) of FAR
15.413-2, the Department has found that the procedure stated in the
first sentence of paragraph 315.608-72 is best and considers it in
compliance with the FAR requirement.
(g) See subpart 324.2 for detailed procedures concerning FOIA
requests.
[49 FR 13979, Apr. 9, 1984; 49 FR 36110, Sept. 14, 1984, as amended at
51 FR 44294, Dec. 9, 1986]
Sec. 315.470 Review of RFP.
The principal official responsible for acquisition shall establish
procedures to ensure that an independent review of the RFP is made
between the time the synopsis is sent to the Commerce Business Daily
announcing the availability of the RFP and the release date of the RFP.
The individual selected to conduct the review must possess the
acquisition knowledge necessary to readily ascertain whether the RFP
contains the required information to be in conformance with all laws,
regulations, and internal procedures and instructions. The individual
selected to conduct the review must be a person other than the preparer
of the RFP.
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23129, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 315.471 Annual submission of representations and certifications.
Each Principal Official Responsible for Acquisition (PORA) shall
determine whether to allow the use of the annual
[[Page 58]]
submission of representations and certifications by offerors. If
allowed, the provisions of FAR 14.213 shall be followed.
[55 FR 13536, Apr. 11, 1990]
Subpart 315.5_Unsolicited Proposals
Sec. 315.505 Content of unsolicited proposals.
(d) Certification by offeror--To ensure against contacts between
Department employees and prospective offerors which would exceed the
limits of advance guidance set forth in FAR 15.504 resulting in an
unfair advantage to an offeror, the principal official responsible for
acquisition (or designee) shall ensure that the following certification
is furnished to the prospective offeror and the executed certification
is included as part of the resultant unsolicited proposal:
Unsolicited Proposal Certification by Offeror
This is to certify, to the best of my knowledge and belief, that:
a. This proposal has not been prepared under Government supervision.
b. The methods and approaches stated in the proposal were developed
by this offeror.
c. Any contact with employees of the Department of Health and Human
Services has been within the limits of appropriate advance guidance set
forth in FAR 15.504.
d. No prior commitments were received from departmental employees
regarding acceptance of this proposal.
Date:___________________________________________________________________
Organization:___________________________________________________________
Name:___________________________________________________________________
Title:__________________________________________________________________
(This certification shall be signed by a responsible official of the
proposing organization or a person authorized to contractually obligate
the organization.)
Sec. 315.506 Agency procedures.
(a) The principal official responsible for acquisition is
responsible for establishing procedures to comply with FAR 15.506(a).
(b) The principal official responsible for acquisition or his/her
designee shall be the point of contact for coordinating the receipt and
handling of unsolicited proposals. Contacts made outside the contracting
activity shall be promptly coordinated with the principal official
responsible for acquisition or the designee.
Sec. 315.506-1 Receipt and initial review.
(d) An unsolicited proposal shall not be refused consideration
merely because it was initially submitted as a grant application.
However, contracts shall not be awarded on the basis of unsolicited
proposals which have been rejected for grant support on the ground that
they lack scientific merit.
Sec. 315.509 Limited use of data.
The legend, Use and Disclosure of Data, prescribed in FAR 15.509(a)
is to be used by the offeror to restrict the use of data for evaluation
purposes only. However, data contained within the unsolicited proposal
may have to be disclosed as a result of a request submitted pursuant to
the Freedom of Information Act. Because of this possibility, the
following notice shall be furnished to all prospective offerors of
unsolicited proposals whenever the legend is provided in accordance with
FAR 15.504(b)(7):
The Government will attempt to comply with the ``Use and Disclosure
of Data'' legend. However, the Government may not be able to withhold a
record (data, document, etc.) nor deny access to a record requested by
an individual (the public) when an obligation is imposed on the
Government under the Freedom of Information Act, 5 U.S.C. 552, as
amended. The Government's determination to withhold or disclose a record
will be based upon the particular circumstances involving the record in
question and whether the record may be exempted from disclosure under
the Freedom of Information Act. Records which the offeror considers to
be trade secrets and commercial or financial information and privileged
or confidential must be identified by the offeror as indicated in the
referenced legend.
Subpart 315.6_Source Selection
Sec. 315.602 Applicability.
(b) This subpart does not apply to contracts for architect-engineer
services or contracts awarded to the Small Business Administration under
section 8(a) of the Small Business Act.
Sec. 315.604 Responsibilities.
(d) Personnel participating in the evaluation process must not
discuss or
[[Page 59]]
reveal information concerning the evaluations except to an individual
participating in the same evaluation proceedings, and then only to the
extent that the information is required in connection with the
proceedings. Divulging information during the evaluation, selection, and
negotiation phases of the acquisition to offerors or to personnel not
having a need to know could jeopardize the resultant award. Therefore,
the contracting officer must instruct personnel participating in the
evaluations to observe these restrictions and insure that all personnel
understand that unauthorized disclosure of information, no matter how
innocent, could compromise the acquisition process and is prohibited.
(e) Only the contracting officer or his/her authorized
representative within the contracting office shall conduct discussions
with offerors relative to any aspect of the acquisition.
Sec. 315.605 Evaluation factors.
(e) The evaluation criteria included in the solicitation serve as
the standard against which all proposals are evaluated. Prospective
offerors rely upon the evaluation criteria in the solicitation in
developing proposals, and they must be assured that the evaluation is
conducted in accordance with those criteria. All personnel involved in
the evaluation process must make sure that the evaluation criteria
contained in the solicitation are the only criteria used in conducting
the evaluation. See FAR 15.406-5(c) and 315.406-5(c) for detailed
guidance on evaluation criteria.
Sec. 315.607 Disclosure of mistakes before award.
(a) The contracting officer shall require that offerors'
clarifications are in writing.
(c)(3) The chief of the contracting office is authorized to make the
written determination permitting a correction of a mistake in a
proposal.
Sec. 315.608 Proposal evaluation.
(a)(1) Cost of price evaluation. (See 315.608-77.)
(2) Technical evaluation. (See 315.608-75 and 76.)
(b) The determination required by FAR 15.608(b) shall be made by the
chief of the contracting office.
[50 FR 23130, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended
at 51 FR 44294, Dec. 9, 1986]
Sec. 315.608-70 Technical evaluation plan.
(a) A technical evaluation plan may be required by the contracting
officer, at his/her discretion, when an acquisition is sufficiently
complex as to warrant a formal plan.
(b) The technical evaluation plan should include at least the
following:
(1) A list of technical evaluation panel members, their
organizations as well as a list of their major consulting clients (if
applicable), their qualifications, and curricula vitae (if available);
(2) A justification for using non-Government technical evaluation
panel members. (Justification is not required if non-Government
evaluators will be used in accordance with standard contracting activity
procedures or policies);
(3) A statement that there is no apparent or actual conflict of
interest regarding any panel member;
(4) A copy of each rating sheet, approved by the contracting
officer, to be used to assure consistency with the evaluation criteria;
and
(5) A brief description of the general evaluation approach.
(c) The technical evaluation plan must be signed by an official
within the program office in a position at least one level above the
project officer or in accordance with contracting activity procedures.
(d) The technical evaluation plan should be submitted to the
contracting officer for review and approval before the solicitation is
issued. The contracting officer shall make sure that the principal
factors relating to the evaluation are reflected in the evaluation
criteria when conducting the review of the plan.
[50 FR 23130, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
Sec. 315.608-71 Technical evaluation panel.
(a) General. (1) A technical evaluation panel is required for all
acquisitions
[[Page 60]]
applicable to this subpart which are expected to exceed $300,000. The
contracting officer has the discretion to require a technical evaluation
panel for acquisitions not exceeding $300,000 based on the complexity of
the acquisition.
(2) The technical evaluation process requires careful consideration
regarding the size, composition, expertise, and function of the
technical evaluation panel. The efforts of the panel can result in the
success or failure of the acquisition.
(b) Role of the project officer. (1) The project officer is the
contracting officer's technical representative for the acquisition
action. The project officer may be a voting member of the technical
evaluation panel, and may also serve as the chairperson of the panel,
unless prohibited by law or contracting activity procedures.
(2) The project officer is responsible for recommending panel
members who are knowledgeable in the technical aspects of the
acquisition and who are competent to identify strengths and weaknesses
of the various proposals. The program training requirements specified in
307.170 must be adhered to when selecting prospective panel members.
(3) The project officer shall ensure that persons possessing
expertise and experience in addressing issues relative to sex, race,
national origin, and handicapped discrimination be included as panel
members in acquisitions which address those issues. The intent is to
balance the composition of the panel so that qualified and concerned
individuals may provide insight to other panel members regarding ideas
and approaches to be taken in the evaluation of proposals.
(4) The project officer is to submit the recommended list of panel
members to an official within the program office in a position at least
one level above the project officer or in accordance with contracting
activity procedures. This official will review the recommendations,
appoint the panel members, and select the chairperson.
(5) The project officer shall arrange for adequate and secure
working space for the panel.
(c) Role of the contracting officer. (1) The contracting officer is
the Department's official representative with delegated acquisition
authority to enter into and administer contracts. The term ``contracting
officer,'' as used in this subpart, may be the contracting officer or
his/her designated representative within the contracting office.
(2) The contracting officer shall not serve as a member of the
technical evaluation panel but should be available to:
(i) Address the initial meeting of the technical evaluation panel
(see 315.608-74(c));
(ii) Provide assistance to the evaluators as required; and
(iii) Ensure that the scores adequately reflect the written
technical evaluation report comments (see 315.608-76).
(d) Conflicts of interest. (1) If a panel member has an actual or
apparent conflict of interest related to a proposal under evaluation,
he/she shall be removed from the panel and replaced with another
evaluator. If a suitable replacement is not available, the panel shall
perform the review without a replacement.
(2) For the purposes of this subpart, conflicts of interest are
defined in the Department's Standards of Conduct set forth in 45 CFR
part 73 which incorporates 5 CFR part 737, Post Employment Conflict of
Interest. The Standards of Conduct shall be applicable to both in-house
personnel and outside evaluators serving on the technical evaluation
panel.
(e) Continuity of evaluation process. (1) The technical evaluation
panel is responsible for evaluating the original proposals, making
recommendations to the chairperson regarding clarifications and
deficiencies of proposals, and, if required by the contracting officer,
assisting the contracting officer during discussions and negotiations,
and reviewing supplemental, revised and/or ``best and final'' offers. To
the extent possible, the same evaluators should be available throughout
the entire evaluation and selection process to ensure continuity and
consistency in the treatment of proposals. The following are examples of
circumstances when it
[[Page 61]]
would not be necessary for the technical evaluation panel to evaluate
revised proposals submitted during the acquisition:
(i) The answers to questions do not have a substantial impact on the
proposal (see 315.609(i));
(ii) The ``best and final'' offers are not materially different from
the original proposals; or
(iii) The rankings of the offerors are not affected because the
revisions to the proposals are relatively minor.
(2) The chairperson, with the concurrence of the contracting
officer, may decide not to have the panel evaluate the revised
proposals. Whenever this decision is made, it must be fully documented
by the chairperson and approved by the contracting officer.
(3) When technical evaluation panel meetings are considered
necessary by the contracting officer, the attendance of evaluators is
mandatory. When the chairperson determines that an evaluator's failure
to attend the meetings is prejudicial to the evaluation, the chairperson
shall replace the individual after discussing the situation with the
contracting officer and obtaining his/her concurrence and the approval
of the program official responsible for appointing the panel members
(see 315.608-71(b)(4)).
(4) Whenever continuity of the evaluation process is not possible,
and either new evaluators are selected or a reduced panel is decided
upon, each proposal which is being reviewed at any stage of the
acquisition shall be reviewed at that stage by all members of the
revised panel unless it is impractical to do so because of the receipt
of an unusually large number of proposals.
(f) Use of outside evaluators. (1) The technical evaluation panel
shall be composed of Government employees except when outside evaluators
possess a required expertise which is not available within the
Government, or as required by law.
(2) The National Institutes of Health (NIH) and the Alcohol, Drug
Abuse, and Mental Health Administration (ADAMHA) are required to have a
peer review of research and development contracts in accordance with
Pub. L. (Pub. L.) 93-352 as amended by Pub. L. 94-63; 42 U.S.C. 289 1-4.
This legislation requires peer review of projects and proposals, and not
more than one-fourth of the members of a peer review group may be
officers or employees of the United States. NIH and ADAMHA are therefore
exempt from the provisions of 315.608-71 to the extent that 42 U.S.C.
289 1-4 applies.
[50 FR 23130, May 31, 1985, and 50 FR 38004, Sept. 19, 1985, as amended
at 53 FR 15563, May 2, 1988]
Sec. 315.608-72 Procedures for handling and disclosing proposals.
(a) The procedures and notice specified in FAR 15.413-2 and 315.413-
2 shall be used in handling solicited proposals and for disclosing
proposals outside the Government for evaluation purposes. (For
unsolicited proposals, see FAR 15.509 and 315.509.)
(b) Decisions to disclose proposals outside the Government for
evaluation purposes shall be made by the chief official having
programmatic responsibility for the acquisition, after consultation with
the contracting officer and in accordance with operating division
procedures. The decision to disclose either a solicited or unsolicited
proposal outside the Government for the purpose of obtaining an
evaluation shall take into consideration the avoidance of organizational
conflicts of interest and any competitive relationship between the
submitter of the proposal and the prospective evaluator(s).
(c) When it is determined to disclose a solicited proposal outside
the Government for evaluation purposes, the following or similar
conditions shall be included in the written agreement with the
evaluator(s) prior to disclosure (see FAR 15.413-2(f) and 315.413-2(f)).
Also, a review must be made to ensure that the notice required by FAR
15.413-2(e) is affixed to the proposal before it is disclosed to the
evaluator(s).
Conditions for Evaluating Proposals
The evaluator agrees to use the data (trade secrets, business data,
and technical data) contained in the proposal only for evaluation
purposes.
This requirement does not apply to data obtained from another source
without restriction.
[[Page 62]]
Any notice or legend placed on the proposal by either the Department
or the submitter of the proposal shall be applied to any reproduction or
abstract provided to the evaluator or made by the evaluator. Upon
completion of the evaluation, the evaluator shall return the Government-
furnished copy of the proposal or abstract, and all copies thereof, to
the Departmental office which initially furnished the proposal for
evaluation.
Unless authorized by the Department's initiating office, the
evaluator shall not contact the submitter of the proposal concerning any
apsects of its contents.
The evaluator will be obligated to obtain commitments from its
employees and subcontractors, if any, in order to effect the purposes of
these conditions.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
Sec. 315.608-73 Receipt of proposals.
(a) After the closing date set by the solicitation for the receipt
of proposals, the contracting officer will use a transmittal memorandum
to forward the technical proposals to the project officer or chairperson
for evaluation. The business proposals will be retained by the
contracting officer for evaluation (see 315.608-77).
(b) The transmittal memorandum to the chairperson shall include at
least the following:
(1) A list of the names of the organizations submitting proposals;
(2) A reference to 315.604(d) on the need to preserve the integrity
of the source selection process;
(3) A requirement for a technical evaluation report in accordance
with 315.608-76; and
(4) The establishment of a date for receipt of the technical
evaluation report.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
Sec. 315.608-74 Convening the technical evaluation panel.
(a) Normally, the technical evaluation panel will convene to
evaluate the proposals. However, there may be situations when the
contracting officer determines that it is not feasible for the panel to
convene. Whenever this decision is made, care must be taken to assure
that the technical review is closely monitored to produce acceptable
results.
(b) When a panel is convened, the chairperson is responsible for the
control of the technical proposals provided to him/her by the
contracting officer for use during the evaluation process. The
chairperson will generally distribute the technical proposals at the
initial panel meeting and will establish procedures for securing the
proposals whenever they are not being evaluated to insure their
confidentiality. After the evaluation is complete, all proposals must be
returned to the contracting officer, destroyed or filed in an
appropriate manner to maintain the confidential nature of the data.
(c) The contracting officer shall address the initial meeting of the
panel and state the basic rules for conducting the evaluation. The
contracting officer shall provide written guidance to the panel if he/
she is unable to attend the initial panel meeting. The guidance should
include:
(1) An explanation of conflicts of interest (see 315.608-71(d));
(2) The necessity to read and understand the solicitation,
especially the statement of work and evaluation criteria, prior to
reading the proposals;
(3) The need for evaluators to restrict the review to only the
solicitation and the contents of the technical proposals;
(4) The need for each evaluator to review all the proposals;
(5) The need to watch for ambiguities, inconsistencies, errors, and
deficiencies which should be surfaced during the evaluation process;
(6) An explanation of the evaluation process and what will be
expected of the evaluators throughout the process;
(7) The need for the evaluators to be aware of the requirement to
have complete written documentation of the individual strengths and
weaknesses which affect the scoring of the proposals; and
(8) An instruction directing the evaluators that, until the award is
made, information concerning the acquisition must not be disclosed to
any person not directly involved in the evaluation process.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
[[Page 63]]
Sec. 315.608-75 Rating and ranking of proposals.
The evaluators will individually read each proposal, describe
tentative strengths and weaknesses, and develop preliminary scores in
relation to each evaluation criterion set forth in the solicitation. The
evaluators will use the rating sheets either in the technical evaluation
plan or approved by the contracting officer when a technical evaluation
plan is not required (see 315.608-70). After this has been accomplished,
the evaluators shall discuss in detail the individual strengths and
weaknesses described by each evaluator and, if possible, arrive at a
common understanding of the major strengths and weaknesses and the
potential for correcting each offeror's weakness(es). Each evaluator
will score each proposal, and then the technical evaluation panel will
collectively rank the proposals. Generally, ranking will be determined
by adding the numerical scores assigned to the evaluation criteria and
finding the average for each offeror. The evaluators should then
identify whether each proposal is acceptable or unacceptable.
Predetermined cutoff scores shall not be employed.
[50 FR 23131, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
Sec. 315.608-76 Technical evaluation report.
A technical evaluation report shall be prepared and furnished to the
contracting officer by the chairperson and maintained as a permanent
record in the contract file. The report must reflect the ranking of the
proposals and identify each proposal as acceptable or unacceptable in
accordance with 315.608-75. The report must also include a narrative
evaluation specifying the strengths and weaknesses of each proposal, a
copy of each rating sheet, and any reservations, qualifications, or
areas to be addressed that might bear upon the selection of sources for
negotiation and award. Concrete technical reasons supporting a
determination of unacceptability with regard to any proposal must be
included. The report should also include specific points and questions
which are to be raised in discussions or negotiations.
[50 FR 23132, May 31, 1985, and 50 FR 38004, Sept. 19, 1985]
Sec. 315.608-77 Evaluation of business proposals.
(a) The contracting officer shall evaluate the business proposals
concurrently with the evaluation of the technical proposals. The
contracting officer must adhere to the requirements for cost or price
analysis included in FAR 15.805-1 for each business proposal in the
competitive range. An audit report may be required in accordance with
FAR 15.805-5 and 315.805-5. The contracting officer must determine the
extent of analysis in each case depending on the amount of the proposal,
the technical complexity and related cost or price, and cost realism.
The contracting officer should request the project officer to analyze
such items as the number of labor hours proposed for various labor
categories; the mix of labor hours and categories of labor in relation
to the technical requirements of the project; the kinds and quantities
of material, equipment, and supplies; types, numbers, and hours/days of
proposed consultants; logic of proposed subcontracting; analysis of the
travel proposed including number of trips, locations, purpose, and
travelers; and kinds and quantities of data processing. The project
officer shall provide his/her opinion as to whether these elements are
necessary and reasonable for efficient contract performance. Exceptions
to proposed elements shall be supported by adequate rationale to allow
for effective negotiations. The contracting officer should also request
the assistance of a cost/price analyst when considered necessary. In all
cases, the negotiation memorandum (see 315.672) must include the
rationale used in determining that the price or cost is fair and
reasonable.
(b) The contracting officer must appraise the management capability
of the offeror to perform the required work in a timely manner. In
making this appraisal, the contracting officer should consider factors
such as the offeror's management organization,
[[Page 64]]
past performance, reputation for reliability, availability of the
required facilities, and cost controls. This information is to be used
by the contracting officer to determine the offeror's responsibility.
[50 FR 23132, May 31, 1975, and 50 FR 38004, Sept. 19, 1985]
Sec. 315.609 Competitive range.
(a) A proposal must be included in the competitive range unless
there is no real possibility that it can be improved to the point where
it becomes the most acceptable.
(e) In certain circumstances, when deciding which proposals should
be included in the competitive range, the contracting officer may
request that the technical evaluation panel review the cost or price
data. Typical situations which may necessitate this review include a
suspected ``buy-in,'' large differences in cost or price among the
proposals, proposals receiving high technical ratings which have
relatively high costs, and proposals receiving low technical ratings
which have relatively low costs. The resultant comparison of cost or
price to technical factors and the determination of cost or price
realism should assist the contracting officer in deciding which
proposals are to be included in the competitive range.
(f) All determinations regarding the inclusion or exclusion of
proposals in the competitive range must be completely documented,
including the salient reasons for the determinations, and set forth in
the negotiation memorandum.
(g) Some of the factors which the contracting officer should
consider in determining the competitive range are:
(1) The relative importance of cost or price as compared to
technical factors in accordance with the solicitation provisions
required in 315.406-5(c);
(2) The susceptibility of significantly reducing a proposal with an
unreasonable high price or cost without undermining the technical merit
if the offeror otherwise has a reasonable chance to receive an award;
and
(3) The likelihood of reducing cost or price of a proposal which
exceeds the Government's requirements.
(h) The contacting officer shall conduct a thorough review of the
technical evaluation report to be assured that:
(1) All determinations of unacceptability are supported by concrete
and comprehensive statements that are factual and convincing and are
consistent with the evaluation criteria set forth in the solicitation.
Every statement should be reviewed carefully to eliminate any doubts as
to the unacceptability of a proposal;
(2) All recommendations to exclude proposals from the competitive
range are supported by persuasive rationale and sufficient facts to
substantiate a judgment that meaningful discussions are not possible or
there is no reasonable chance of the proposal being selected for award;
(3) Those cases where only one organization is found to be
technically acceptable are fully scrutinized; and
(4) Unacceptable proposals contain ``information'' deficiencies
which are so material as to preclude any possibility of upgrading the
proposal to a competitive level except through major revisions and
additions which would be tantamount to the submission of another
proposal.
(i) The contracting officer and project officer should discuss the
uncertainties and/or deficiencies that are included in the technical
evaluation report for each proposal in the competitive range. Technical
questions should be developed by the project officer and/or the
technical evaluation panel and should be included in the technical
evaluation report. The management and cost or price questions should be
prepared by the contracting officer with assistance from the project
officer and/or panel as required. The method of requesting offerors in
the competitive range to submit the additional information will vary
depending on the complexity of the questions, the extent of additional
information requested, the time needed to analyze the responses, and the
time frame for making the award. However, to the extent practicable, all
questions and answers should be in writing. Each offeror in the
competitive range shall be given an equitable period of time for
preparation of responses to questions to the extent practicable. The
questions
[[Page 65]]
should be developed so as to disclose the ambiguities, uncertainties,
and deficiencies of the offeror (see FAR 15.610(c)).
Sec. 315.610 Written or oral discussions.
(b) The contracting officer, with the support of personnel who
evaluated the technical proposals, and, if necessary, cost analysts,
attorneys, etc., must conduct written or oral discussions with all
responsible offerors within the competitive range.
(d) Careful judgment must be exercised in determining the extent of
discussions. In some cases, more than one round of discussions with all
the offerors within the competitive range may be required. The time
available, the expense and administrative limitations, and the
complexity, size, and significance of the acquisition should all be
considered in deciding on the type, duration, and depth of the
discussions.
Sec. 315.611 Best and final offers.
(b)(5) Notice that confirmation of a prior offer should be
specifically stated as a final offer; and
(6) Notice that all revisions to former offers should be submitted
on Standard Form 1411, Contract Pricing Proposal Cover Sheet, and should
be fully documented.
(c) ``Best and final'' offers are subject to a final evaluation of
price or cost and other salient factors by the contracting officer and
project officer with assistance from a cost/price analyst, and an
evaluation of technical factors by the technical evaluation panel, as
necessary. Proposals may be technically rescored and reranked by the
technical evaluation panel and a technical evaluation report prepared.
To the extent practicable, the evaluation shall be performed by the same
evaluators who reviewed the original proposals (see 315.670--).
(e) Of particular importance in the award of research or development
contracts, including those with educational institutions, is the
competence of key personnel in the specific field of science or
technology involved, as reflected in the proposal. However, awards
should not be made for research and development capabilities that exceed
those needed for the successful performance of the particular project.
Sec. 315.670 Negotiation with the selected source.
(a) After selection of the successful proposal, a limited
negotiation with the selected offeror may be conducted if deemed
necessary. However, no factor which could have any effect on the
selection process may be introduced into the negotiation after the
common cutoff date for receipt of best and final offers. The negotiation
shall not in any way prejudice the competitive interests or right of the
unsuccessful offerors. Negotiations with the selected offeror shall be
restricted to definitizing the final agreement on terms and conditions;
e.g., assuming none of these factors were involved in the selection
process, negotiation could include such topics as payment provisions,
patent rights, rights in data, property provisions, labor rates,
indirect cost rates, and fees. Prior to conducting the limited
negotiation, the contracting officer shall approve a written
determination citing both the specific issues to be discussed and the
rationale showing that the negotiations shall not have any effect on the
selection process.
(b) Caution must be exercised by the contracting officer to insure
that the negotiation is not used to change the requirement contained in
the solicitation, nor to make any other changes which would impact on
the source selection decision. Whenever a material change occurs in the
requirements as a result of the negotiation, the competition must be
reopened and all offerors submitting ``best and final'' offers must be
given an opportunity to resubmit proposals based on the revised
requirements. Whenever there is a question as to whether a change is
material, the contracting officer should obtain the advice of technical
personnel and legal counsel before reopening the competition.
Significant changes in the offeror's cost proposal may also necessitate
a reopening of competition if such changes alter the factors involved in
the original selection process.
(c) Should negotiations beyond those specified in (a) above be
required for
[[Page 66]]
any reason, discussions must be reopened with all offerors submitting
``best and final'' offers.
(d) Upon completion of the negotiation, the contracting officer
shall obtain a confirmation letter from the successful offeror which
includes any revisions to the technical proposal, the agreed to price or
cost, and, as applicable, a certificate of current cost or pricing data.
[49 FR 13979, Apr. 9, 1984, 49 FR 36110, Sept. 14, 1984]
Sec. 315.671 Post negotiation contract preparation and award.
(a) The contracting officer must perform the following actions after
negotiations have been completed:
(1) Prepare the negotiation memorandum in accordance with 315.672;
(2) Prepare the contract containing all agreed to terms and
conditions and clauses required by law or regulation;
(3) Include in the contract file the pertinent documents referenced
in FAR 4.803; and
(4) Obtain the appropriate approval of proposed contract awards in
accordance with subpart 304.71 and contracting activity procedures.
(b) After receiving the required approvals, the contract should be
transmitted to the prospective contractor for signature. The prospective
contractor must be informed that the contract is not effective until
accepted by the contracting officer.
(c) The contract shall not be issued until the finance office
certifies that the funds are available for obligation.
Sec. 315.672 Preparation of negotiation memorandum.
The negotiation memorandum or summary of negotiations is a complete
record of all actions leading to award of a contract and is prepared by
the contract negotiator. It should be in sufficient detail to explain
and support the rationale judgments, and authorities upon which all
actions were predicated. The memorandum will document the negotiation
process and reflect the negotiator's actions, skills, and judgments in
concluding a satisfactory agreement for the Government. Negotiation
memorandums shall contain discussion of the following or a statement of
nonapplicability; however, information already contained in the contract
file need not be reiterated. A reference to the document which contains
the required information is satisfactory.
(a) Description of articles and services and period of performance.
A description of articles and services, quantity, unit price, total
contract amount, and period of contract performance should be set forth
(if Supplemental Agreement--show previous contract amount as revised, as
well as information with respect to the period of performance).
(b) Acquisition planning. Summarize any acquisition planning
activities that have taken place. Include items such as meetings with
program and staff personnel and the development of acquisition planning
schedules.
(c) Synopsis of proposed acquisition. A statement as to whether the
acquisition has or has not been publicized in accordance with FAR
subpart 5.2. A brief statement of explanation should be included with
reference to the specific basis for exemption under the FAR, if
applicable.
(d) Contract type. Provide sufficient detail to support the type of
contractural instrument recommended for the acquisition and cite any
required D & F. If the contract is a cost-sharing type, explain the
essential cost-sharing features.
(e) Extent of competition. The extent to which full and open
competition was solicited and obtained must be discussed. The discussion
shall include the date of solicitation, sources solicited, and
solicitation results. If a late proposal was received, discuss whether
or not the late proposal was evaluated and the rationale for the
decision. If the acquisition is to be awarded without full and open
competition, discuss the rationale for the decision.
(f) Technical evaluation. Summarize the results presented in the
technical evaluation report and delineate the basis of acceptability or
unacceptability of the proposals from a technical standpoint. Discussion
should be in nontechnical terms.
(g) Business evaluation. Summarize the results presented in the
business report and delineate the basis for the determination of
acceptability or
[[Page 67]]
unacceptability of the business proposals.
(h) Competitive range. If full and open competition, describe how
the zone of consideration or competitive range was determined and state
the offerors who were included in the competitive range and the ones who
were not. Explain why any offeror who submitted a technically acceptable
proposal was not included in further discussions. Comment on any changes
made in the offeror's proposal as a result of the discussions.
(i) Cost breakdown and analysis. Include a complete cost breakdown
together with the negotiator's analysis of the estimated cost by
individual cost elements. The negotiator's analysis should contain such
information as:
(1) A comparison of cost factors proposed in the instant case with
actual cost factors used in earlier contracts, using the same cost
centers of the same supplier or cost centers or other sources having
recent contracts for the same or similar item.
(2) Any pertinent Government-conducted audit of the proposed
contractor's records of any pertinent cost advisory report (see FAR
15.805).
(3) Any pertinent technical evaluation inputs as to necessity,
allocability and reasonableness of labor, material and other direct
expenses.
(4) Any other pertinent information to fully support the basis for
and rationale of the cost analysis.
(5) If the contract is an incentive type, discuss the rationale for
the following:
(i) Cost-plus-award-fee.
(A) Base fee.
(B) Maximum fee.
(C) Award fee.
(ii) Cost-plus-incentive-fee.
(A) Minimum fee.
(B) Target fee.
(C) Maximum fee.
(D) Incentives relative to performance and/or delivery.
(E) Sharing ratios.
(iii) Fixed-price incentives.
(A) Target profit.
(B) Target price.
(C) Ceiling price.
(D) Sharing rations.
(E) Incentives relative to performance and/or delivery.
(6) A justification of the reasonableness of the proposed
contractor's estimated profit or fixed fee, considering such factors as
any competitive elements, established efficiency or performance, extent
of the risk assumed by the proposed contractor, character of the
proposed contractor's normal business, the extent of subcontracting in
the instant case and the reasons, capital employed, and other factors as
are appropriate, including type of organization.
(j) Government-furnished property and Government-provided
facilities. With respect to Government-furnished material or Government-
provided facilities, equipment, tooling, or other property, include the
following: (A separate D & F is required for facilities construction.)
(1) Where no property is to be provided, a statement to that effect.
(2) Where property is to be provided, a full description, the
estimated dollar value, the basis of price comparison with competitors,
and the basis of rental charge, if rental is involved.
(3) Where the furnishing of any property or the extent has not been
determined and is left open for future resolution, a detailed
explanation.
(k) Negotiations. Include a statement as to the date and place
negotiations were conducted, and identify members of both the Government
and contractor negotiating teams by area of responsibility. Include
negotiation details relative to the statement of work, terms and
conditions, and special provisions. The results of cost or price
negotiations must include the information required by FAR 31.109 and
15.808. In addition, if cost or pricing data was required to be
submitted and certified, the negotiation record must also contain the
extent to which the contracting officer relied upon the factual cost or
pricing data submitted and used in negotiating the cost or price.
(l) Other considerations. Include coverage of areas such as:
(1) Financial data with respect to a contractor's capacity and
stability.
(2) Determination of contractor responsibility.
(3) Details as to why the method of payment, such as progress
payment,
[[Page 68]]
advance payment, etc., is necessary. Also cite any required D & F's.
(4) Information with respect to obtaining of a certificate of
current cost or pricing data.
(5) Other required special approvals, such as those referenced in
307.105-2.
(6) If the contract represents an extension of previous work, the
status of funds and performance under the prior contract(s) should be
reflected. Also, a determination should be made that the Government has
obtained enough actual or potential value from the work previously
performed to warrant continuation with the same contractor. (Project
officer should furnish the necessary information.)
(7) If the contract was awarded by full and open competition state
where the unsuccessful offerors' proposals are filed.
(8) State that equal opportunity provisions of the proposed contract
have been explained to the contractor, and it is aware of its
responsibilities. Also state whether or not a clearance is required.
(9) If the contract is for services, a statement must be made, in
accordance with FAR 37.103 and 337.103, that the services to be acquired
are nonpersonal in nature.
(m) Terms and conditions. Identify the general provisions and any
special clauses and conditions that are contained in the contract, such
as option arrangements, incremental funding, anticipatory costs,
deviations from the standard clauses, etc. The basis and rationale for
inclusion of any special terms and conditions must be stated and, where
applicable, the document which granted approval for its use identified.
(n) Recommendation. A brief statement setting forth the
recommendations for award.
(o) Signature. The memorandum must be signed by the contract
negotiator who prepared the memorandum.
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23132, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Subpart 315.8_Price Negotiation
Sec. 315.804 Cost or pricing data.
Sec. 315.804-3 Exemptions from or waiver of submission of certified
cost or pricing data.
(i) Waiver for exceptional cases. The authority referenced in FAR
15.804-3(i) may be delegated to the principal official responsible for
acquisition.
[51 FR 44294, Dec. 9, 1986]
Sec. 315.805 Proposal analysis.
Sec. 315.805-5 Field pricing support.
(2) When some or all information sufficient to determine the
reasonableness of the proposed cost or price is already available or can
be obtained by phone from the cognizant audit agency, contracting
officers may request less-than-complete field pricing support
(specifying in the request the information needed) or may waive in
writing the requirement for audit and field pricing support by
documenting the file to indicate what information is to be used instead
of the audit report and the field pricing report.
(c)(1) When initiating audit and field pricing support, the
contracting officer shall do so by sending a request to the cognizant
administrative contracting officer (ACO), with an information copy to
the cognizant audit office. When field pricing support is not available,
the contracting officer shall initiate an audit by sending, in
accordance with agency procedures, two (2) copies of the request to the
OIG Office of Audits' Regional Audit Director. In both cases, the
contracting officer shall, in the request:
(i) Prescribe the extent of the support needed;
(ii) State the specific areas for which input is required;
(iii) Include the information necessary to perform the review (such
as the offeror's proposal and the applicable portions of the
solicitations, particularly those describing requirements and delivery
schedules);
(iv) Provide the complete address of the location of the offeror's
financial records that support the proposal;
[[Page 69]]
(v) Identify the office having audit responsibility if other than an
HHS Regional Audit Office; and
(vi) Specify a due date for receipt of a verbal report to be
followed by a written audit report. (If the time available is not
adequate to permit satisfactory coverage of the proposal, the auditor
shall so advise the contracting officer and indicate the additional time
needed.) Normally, the Office of Audits will need 30 days after receipt
of the proposal for submission of oral results. However, the Office of
Audits' ability to conduct reviews by the due date will be influenced by
the OPDIV's ability to properly plan its acquisitions. If the Office of
Audits requires additional time to conduct the review, the contracting
officer has the option, at the time the auditor acknowledges receipt of
the request, to accept the revised due date or cancel the request and
use cost advisory services within the agency to satisfy the requirement.
In such cases, the contracting officer shall immediately advise the OIG/
OA/Regional Audit Director and the OIG/OA/Division of Audit Coordination
(OIG/OA/DAC) of the revised due date or cancellation of the request.
(4) One copy of the audit request letter that was submitted to the
Regional Audit Director and a complete copy of the contract price
proposal shall be submitted to OIG/OA/DAC.
(5) Whenever, an audit review has been conducted by the Office of
Audits, two (2) copies of the memorandum of negotiation shall be
forwarded to OIG/OA/DAC by the contracting officer (see FAR 15.808(b)).
Subpart 315.9_Profit
Sec. 315.900 Scope of subpart.
This subpart--
(c) Prescribes a structured approach for establishing the profit or
fee portion of the Government prenegotiation objective in all contracts
requiring cost analysis except as stated in 315.905-70(b). The profit
analysis factors set forth at FAR 15.905 shall be used in all excepted
contracts requiring cost analysis.
Sec. 315.905-70 Structured approach.
(a) General. (1) The structured approach for determining profit or
fee (hereafter referred to as profit) provides contracting officers with
a technique that will ensure consideration of the relative value of the
appropriate profit factors described in 315.905-71 in the establishment
of a profit objective for the conduct of negotiations. The contracting
officer's analysis of these profit factors is based on information
available to him/her prior to negotiations. Such information is
furnished in proposals, audit data, assessment reports, preaward surveys
and the like. The structured approach also provides a basis for
documentation of this objective, including an explanation of any
significant departure from this objective in reaching an agreement. The
extent of documentation should be directly related to the dollar value
and complexity of the proposed acquisition.
(2) The negotiation process does not require agreement on either
estimated cost elements or profit elements. The profit objective is a
part of an overall negotiation objective which, as a going-in objective,
bears a distinct relationship to the cost objective and any proposed
sharing arrangement. Since profit is merely one of several interrelated
variables, the Government negotiator generally should not complete the
profit negotiation without simultaneously agreeing on the other
variables. Specific agreement on the exact weights or values of the
individual profit factors is not required and should not be attempted.
(b) Exceptions. (1) The profit-analysis factors set forth at FAR
15.905 shall be used for establishing profit objectives under the
following listed circumstances. Generally, it is expected that this
method will be supported in a manner similar to that used in the
structured approach (profit factor breakdown and documentation of the
profit objective); however, factors within FAR 15.905 considered
inapplicable to the acquisition will be excluded from the profit
objective.
(i) Contracts not expected to exceed $100,000;
(ii) Architect-engineer contracts;
[[Page 70]]
(iii) Management contracts for operation and/or maintenance of
Government facilities;
(iv) Construction contracts;
(v) Contracts primarily requiring delivery of material supplies by
subcontractors;
(vi) Termination settlements; and
(vii) Cost-plus-award-fee contracts (However, contracting officers
may find it advantageous to perform a structured profit analysis as an
aid in arriving at an appropriate fee arrangement).
(2) Other exceptions may be made in the negotiation of contracts
having unusual pricing situations. Such exceptions shall be justified in
writing by the contracting officer in situations where the structured
approach is determined to be unsuitable.
(c) Limitation. The maximum profit objective shall be the percentage
allowed pursuant to statute or regulation (see FAR 15.903(d)).
(d) Profit objective. (1) A profit objective is that part of the
estimated contract price objective or value which, in the judgment of
the contracting officer, constitutes an appropriate amount of profit for
the acquisition being considered. This objective should realistically
reflect the total overall task to be performed and the requirements
placed on the contractor.
(2) Development of a profit objective should not begin until the
following actions have been accomplished:
(i) A thorough review of proposed contract work;
(ii) A review of all available knowledge regarding the contractor
pursuant to FAR subpart 9.1, including audit data, preaward survey
reports and financial statements, as appropriate; and
(iii) An analysis of the contractor's cost estimate and comparison
with the Government's estimate or projection of cost.
Sec. 315.905-71 Profit factors.
(a) The following factors shall be considered in all cases in which
profit is to be negotiated. The weight ranges listed after each factor
shall be used in all instances where the structured approach is used.
------------------------------------------------------------------------
Weight
Profit factors ranges
(percent)
------------------------------------------------------------------------
Contractor effort:
Material acquisition.................................... 1 to 5
Direct labor............................................ 4 to 15
Overhead................................................ 4 to 9
General management (G&A)................................ 4 to 8
Other costs............................................. 1 to 5
Other factors:
Cost risk............................................... 0 to 7
Investment.............................................. -2 to +2
Performance............................................. -1 to +1
Socioeconomic programs.................................. -.5 to +.5
Special situations...................................... ............
------------------------------------------------------------------------
(b) Under the structured approach, the contracting officer shall
first measure ``Contractor Effort'' by the assignment of a profit
percentage within the designated weight ranges to each element of
contract cost recognized by the contracting officer. The amount
calculated for the cost of money for facilities capital is not to be
included for the computation of profit as part of the cost base.
(c) The suggested categories under ``Contractor Effort'' are for
reference purposes only. Often individual proposals will be in a
different format, but since these categories are broad and basic, they
provide sufficient guidance to evaluate all other items of cost.
(d) After computing a total dollar profit for ``Contractor Effort,''
the contracting officer shall then calculate the specific profit dollars
assigned for cost risk, investment, performance, socioeconomic programs,
and special situations. This is accomplished by multiplying the total
Government Cost Objective, exclusive of any cost of money for facilities
capital, by the specific weight assigned to the elements within the
``Other Factors'' category. Form HHS-674, Structured Approach Profit/Fee
Objective, should be used, as appropriate, to facilitate the calculation
of this profit objective. Form HHS-674 is illustrated in 353.370-674.
(e) In making a judgment of the value of each factor, the
contracting officer should be governed by the definition, description,
and purpose of the factors together with considerations for evaluating
them as set forth in 315.905-72 and 315.905-73.
(f) The structured approach was designed for arriving at profit
objectives for other than nonprofit organizations. However, if
appropriate adjustments
[[Page 71]]
are made to reflect differences between profit and nonprofit
organizations, the structured approach can be used as a basis for
arriving at profit objectives for nonprofit organizations. Therefore,
the structured approach, as modified in paragraph (f)(2) below, shall be
used to establish profit objectives for nonprofit organizations.
(1) For purposes of this section, nonprofit organizations are
defined as those business entities organized and operated exclusively
for charitable, scientific, or educational purposes, no part of the net
earnings of which inure to the benefit of any private shareholder or
individual, and which are exempt from Federal income taxation under
Section 501 of the Internal Revenue Code.
(2) For contracts with nonprofit organizations where profit is
involved, an adjustment of up to 3 percentage points will be subtracted
from the total profit objective percentage. In developing this
adjustment, it will be necessary to consider the following factors:
(i) Tax position benefits;
(ii) Granting of financing through advance payments; and
(iii) Other pertinent factors which may work to either the advantage
or disadvantage of the contractor in its position as a nonprofit
organization.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988; 56
FR 47003, Sept. 17, 1991]
Sec. 315.905-72 Contractor effort.
(a) General. Contractor effort is a measure of how much the
contractor is expected to contribute to the overall effort necessary to
meet the contract performance requirement in an efficient manner. This
factor, which is apart from the contractor's responsibility for contract
performance, takes into account what resources are necessary and what
the contractor must do to accomplish a conversion of ideas and material
into the final service or product called for in the contract. This is a
recognition that within a given performance output, or within a given
sales dollar figure, necessary efforts on the part of individual
contractors can vary widely in both value and quantity, and that the
profit objective should reflect the extent and nature of the
contractor's contribution to total performance. A major consideration,
particularly in connection with experimental, developmental, or research
work, is the difficulty or complexity of the work to be performed, and
the unusual demands of the contract, such as whether the project
involves a new approach unrelated to existing technology and/or
equipment or only refinements to these items. The evaluation of this
factor requires an analysis of the cost content of the proposed contract
as follows:
(1) Material acquisition. (Subcontracted items, purchased parts, and
other material.) Analysis of these cost items shall include an
evaluation of the managerial and technical effort necessary to obtain
the required subcontracted items, purchased parts, material or services.
The contracting officer shall determine whether the contractor will
obtain the items or services by routine order from readily available
sources or by detailed subcontracts for which the prime contractor will
be required to develop complex specifications. Consideration shall also
be given to the managerial and technical efforts necessary for the prime
contractor to select subcontractors and to perform subcontract
administration functions. In application of this criterion, it should be
recognized that the contribution of the prime contractor to its
purchasing program may be substantial. Normally, the lowest unadjusted
weight for direct material is 2 percent. A weighting of less than 2
percent would be appropriate only in unusual circumstances when there is
a minimal contribution by the contractor.
(2) Direct Labor (Professional, service, manufacturing and other
labor). Analysis of the various labor categories of the cost content of
the contract should include evaluation of the comparative quality and
quantity of professional and semiprofessional talents, manufacturing and
service skills, and experience to be employed. In evaluating
professional and semiprofessional labor for the purpose of assigning
profit dollars, consideration should be given to the amount of notable
scientific talent or
[[Page 72]]
unusual or scarce talent needed in contrast to nonprofessional effort.
The assessment should consider the contribution this talent will provide
toward the achievement of contract objectives. Since nonprofessional
labor is relatively plentiful and rather easily obtained by the
contractor and is less critical to the successful performance of
contract objectives, it cannot be weighted nearly as high as
professional or semiprofessional labor. Service contract labor should be
evaluated in a like manner by assigning higher weights to engineering or
professional type skills and lower weights to semiprofessional or other
type skills required for contract performance. Similarly, the variety of
manufacturing and other categories of labor skills required and the
contractor's manpower resources for meeting these requirements should be
considered. For purposes of evaluation, categories of labor (i.e.,
quality control, receiving and inspection, etc.) which do not fall
within the definition for professional, service or manufacturing labor
may be categorized as appropriate. However, the same evaluation
considerations as outlined above will be applied.
(3) Overhead and general management (G&A). (i) Analysis of these
overhead items of cost should include the evaluation of the makeup of
these expenses and how much they contribute to contract performance. To
the extent practicable, analysis should include a determination of the
amount of labor within these overhead pools and how this labor would be
treated if it were considered as direct labor under the contract. The
allocable labor elements should be given the same profit considerations
that they would receive if they were treated as direct labor. The other
elements of these overhead pools should be evaluated to determine
whether they are routine expenses, such as utilities and maintenance,
and hence given lesser profit consideration, or whether they are
significant contributing elements. The composite of the individual
determinations in relation to the elements of the overhead pools will be
the profit consideration given the pools as a whole. The procedure for
assigning relative values to these overhead expenses differs from the
method used in assigning values of the direct labor. The upper and lower
limits assignable to the direct labor are absolute. In the case of
overhead expenses, individual expenses may be assigned values outside
the range as long as the composite ratio is within the range.
(ii) It is not necessary that the contractor's accounting system
break down overhead expenses within the classifications of research
overhead, other overhead pools, and general administrative expenses,
unless dictated otherwise by Cost Accounting Standards (CAS). The
contractor whose accounting system reflects only one overhead rate on
all direct labor need not change its system (if CAS exempt) to
correspond with the above classifications. The contracting officer, in
an evaluation of such a contractor's overhead rate, could break out the
applicable sections of the composite rate which could be classified as
research overhead, other overhead pools, and general and administrative
expenses, and follow the appropriate evaluation technique.
(iii) Management problems surface in various degrees and the
management expertise exercised to solve them should be considered as an
element of profit. For example, a contract for a new program for
research or an item which is on the cutting edge of the state of the art
will cause more problems and require more managerial time and abilities
of a higher order than a follow-on contract. If new contracts create
more problems and require a higher profit weight, follow-ons should be
adjusted downward because many of the problems should have been solved.
In any event, an evaluation should be made of the underlying managerial
effort involved on a case-by-case basis.
(iv) It may not be necessary for the contracting officer to make a
separate profit evaluation of overhead expenses in connection with each
acquisition action for substantially the same project with the same
contractor. Where an analysis of the profit weight to be assigned to the
overhead pool has been made, that weight assigned may be used for future
acquisitions with the same contractor until there is a change in the
cost composition of the overhead
[[Page 73]]
pool or the contract circumstances, or the factors discussed in (iii)
above are involved.
(b) Other costs. Analysis of this factor should include all other
direct costs associated with contractor performance (e.g., travel and
relocation, direct support, and consultants). Analysis of these items of
cost should include:
(1) The significance of the cost of contract performance;
(2) Nature of the cost; and
(3) How much they contribute to contract performance. Normally,
travel costs require minimal administrative effort by the contractor
and, therefore, usually receive a weight no greater than 1 percent.
Also, the contractor may designate individuals as ``consultants'' but in
reality these individuals may be obtained by the contractor to
supplement its workforce in the performance of routine duties required
by contract. These costs would normally receive a minimum weight.
However, there will be instances when the contractor may be required to
locate and obtain the services of consultants having expertise in such
fields as medicine or human services. In these instances, the contractor
will be required to expend greater managerial and technical effort to
obtain such services and, consequently, such costs should receive a much
greater weight.
Sec. 315.905-73 Other factors.
(a) Contract cost risk. The contract type employed basically
determines the degree of cost risk assumed by the contractor. For
example, where a portion of the risk has been shifted to the Government
through cost-reimbursement provisions, unusual contingency provisions,
or other risk-reducing measures, the amount of profit should be less
than where the contractor assumes all the risk. In developing the
prenegotiation profit objective, the contracting officer will need to
consider the type of contract anticipated to be negotiated and the
contractor risk associated therewith when selecting the position in the
weight range for profit that is appropriate for the risk to be borne by
the contractor. This factor should be one of the most important in
arriving at prenegotiation profit objectives.
(1) Evaluation of this risk requires a determination of:
(i) The degree of cost responsibility the contractor assumes;
(ii) The reliability of the cost estimates in relation to the task
assumed; and
(iii) The complexity of the task assumed by the contractor. This
factor is specifically limited to the risk of contract costs. Thus, such
risks on the part of the contractor as reputation, losing a commercial
market, risk of losing potential profits in other fields, or any risk
which falls on the contracting office such as the risk of not acquiring
a satisfactory report, are not within the scope of this factor.
(2) The first and basic determination of the degree of cost
responsibility assumed by the contractor is related to the sharing of
total risk of contract cost by the Government and the contractor through
the selection of contract type. The extremes are a cost-plus-a-fixed-fee
contract requiring the contractor to use its best efforts to perform a
task and a firm fixed-price contract for a service or a complex item. A
cost-plus-a-fixed-fee contract would reflect a minimum assumption of
cost responsibility, whereas a firm fixed-price contract would reflect a
complete assumption of cost responsibility. Where proper contract
selection has been made, the regard for risk by contract type would
usually fall into the following percentage ranges:
Percent
Cost-reimbursement type contracts--0-3
Fixed-price type contracts--2-7
(3) The second determination is that of the reliability of the cost
estimates. Sound price negotiation requires well-defined contract
objectives and reliable cost estimates. Prior experience assists the
contractor in preparing reliable cost estimates on new acquisitions for
similar related efforts. An excessive cost estimate reduces the
possibility that the cost of performance will exceed the contract price,
thereby reducing the contractor's assumption of contract cost risk.
(4) The third determination is that of the difficulty of the
contractor's task. The contractor's task can be difficult
[[Page 74]]
or easy, regardless of the type of contract.
(5) Contractors are likely to assume greater cost risk only if
contracting officers objectively analyze the risk incident to proposed
contracts and are willing to compensate contractors for it. Generally, a
cost-plus-fixed fee contract will not justify a reward for risk in
excess of 0.5 percent, nor will a firm fixed-price contract justify a
reward of less than the minimum in the structured approach. Where proper
contract-type selection has been made, the reward for risk, by contract
type, will usually fall into the following percentage ranges:
(i) Type of contract and percentage ranges for profit objectives
developed by using the structured approach for research and development
and manufacturing contracts:
Percent
Sec. Cost-plus-fixed fee--0 to 0.5
Sec. Cost-plus-incentive fee:
With cost incentive only--1 to 2
With multiple incentives--1.5 to 3
Sec. Fixed-price-incentive:
With cost incentive only--2 to 4
With multiple incentives--3 to 5
Sec. Prospective price redetermination--3 to 5
Sec. Firm fixed-price--5 to 7
(ii) Type of contract and percentage ranges for profit objectives
developed by using the structured approach for service contracts:
Percent
Sec. Cost-plus-fixed fee--0 to 0.5
Sec. Cost-plus-incentive fee--1 to 2
Sec. Fixed-price incentive--2 to 3
Sec. Firm fixed-price--3 to 4
(6) These ranges may not be appropriate for all acquisitions. For
instance, a fixed-price-incentive contract that is closely priced with a
low ceiling price and high incentive share may be tantamount to a firm
fixed-price contract. In this situation, the contracting officer may
determine that a basis exists for high confidence in the reasonableness
of the estimate and that little opportunity exists for cost reduction
without extraordinary efforts. On the other hand, a contract with a high
ceiling and low incentive formula can be considered to contain cost-
plus-incentive-fee contract features. In this situation, the contracting
officer may determine that the Government is retaining much of the
contract cost responsibility and that the risk assumed by the contractor
is minimal. Similarly, if a cost-plus-incentive-fee contract includes an
unlimited downward (negative) fee adjustment on cost control, it could
be comparable to a fixed-price-incentive contract. In such a pricing
environment, the contracting officer may determine that the Government
has transferred a greater amount of cost responsibility to the
contractor than is typical under a normal cost-plus-incentive-fee
contract.
(7) The contractor's subcontracting program may have a significant
impact on the contractor's acceptance of risk under a contract form. It
could cause risk to increase or decrease in terms of both cost and
performance. This consideration should be a part of the contracting
officer's overall evaluation in selecting a factor to apply for cost
risk. It may be determined, for instance, that the prime contractor has
effectively transferred real cost risk to a subcontractor and the
contract cost risk evaluation may, as a result, be below the range which
would otherwise apply for the contract type being proposed. The contract
cost risk evaluation should not be lowered, however, merely on the basis
that a substantial portion of the contract costs represents subcontracts
without any substantial transfer of contractor's risk.
(8) In making a contract cost risk evaluation in an acquisition
action that involves definitization of a letter contract, unpriced
change orders, and unpriced orders under BOA's, consideration should be
given to the effect on total contract cost risk as a result of having
partial performance before definitization. Under some circumstances it
may be reasoned that the total amount of cost risk has been effectively
reduced. Under other circumstances it may be apparent that the
contractor's cost risk remained substantially unchanged. To be
equitable, the determination of profit weight for application to the
total of all recognized costs, both those incurred and those yet to be
expended, must be made with consideration to all attendant
circumstances--not just the portion of costs incurred or percentage
[[Page 75]]
of work completed prior to definitization.
(9) Time and material and labor hour contracts will be considered to
be cost-plus-a-fixed-fee contracts for the purpose of establishing
profit weights unless otherwise exempt under 315.905-70(b) in the
evaluation of the contractor's assumption of contract cost risk.
(b) Investment. HHS encourages its contractors to perform their
contracts with the minimum of financial, facilities, or other assistance
from the Government. As such, it is the purpose of this factor to
encourage the contractor to acquire and use its own resources to the
maximum extent possible. The evaluation of this factor should include an
analysis of the following:
(1) Facilities (Including equipment). To evaluate how this factor
contributes to the profit objective requires knowledge of the level of
facilities utilization needed for contract performance, the source and
financing of the required facilities, and the overall cost effectiveness
of the facilities offered. Contractors who furnish their own facilities
which significantly contribute to lower total contract costs should be
provided with additional profit. On the other hand, contractors who rely
on the Government to provide or finance needed facilities should receive
a corresponding reduction in profit. Cases between the above examples
should be evaluated on their merits with either positive or negative
adjustments, as appropriate, in profit being made. However, where a
highly facilitized contractor is to perform a contract which does not
benefit from this facilitization or where a contractor's use of its
facilities has a minimum cost impact on the contract, profit need not be
adjusted. When applicable, the prospective contractor's computation of
facilities capital cost of money for pricing purposes under CAS 414 can
help the contracting officer identify the level of facilities investment
to be employed in contract performance.
(2) Payments. In analyzing this factor, consideration should be
given to the frequency of payments by the Government to the contractor.
The key to this weighting is to give proper consideration to the impact
the contract will have on the contractor's cash flow. Generally,
negative consideration should be given for advance payments and payments
more frequent than monthly with maximum reduction being given as the
contractor's working capital approaches zero. Positive consideration
should be given for payments less frequent than monthly with additional
consideration given for a capital turn-over-rate on the contract which
is less than the contractor's or the industry's normal capital turn-over
rate.
(c) Performance. (Cost-control and other past accomplishments.) The
contractor's past performance should be evaluated in such areas as
quality of service or product, meeting performance schedules, efficiency
in cost control (including need for and reasonableness of cost
incurred), accuracy and reliability of previous cost estimates, degree
of cooperation by the contractor (both business and technical), timely
processing of changes and compliance with other contractual provisions,
and management of subcontract programs. Where a contractor has
consistently achieved excellent results in the foregoing areas in
comparison with other contractors in similar circumstances, such
performance merits a proportionately greater opportunity for profit.
Conversely a poor record in this regard should be reflected in
determining what constitutes a fair and reasonable profit.
(d) Federal socioeconomic programs. This factor, which may apply to
special circumstances or particular acquisitions, relates to the extent
of a contractor's successful participation in the Government sponsored
programs such as small business, small disadvantaged business, labor
surplus area, and energy conservation efforts. The contractor's policies
and procedures which energetically support Government socioeconomic
programs and achieve successful results should be given positive
considerations. Conversely, failure or unwillingness on the part of the
contractor to support Government socioeconomic programs should be viewed
as evidence of poor performance for the purpose of establishing a profit
objective.
(e) Special situations. (1) Inventive and developmental
contributions. The extent
[[Page 76]]
and nature of contractor-initiated and financed independent development
should be considered in developing the profit objective, provided that
the contracting officer has made a determination that such effort will
benefit the contract. The importance of the development in furthering
health and human services purposes, the demonstrable initiative in
determining the need and application of the development, the extent of
the contractor's cost risk, and whether the development cost was
recovered directly or indirectly from Government sources should be
weighed.
(2) Unusual pricing agreements. Occasionally, unusual contract
pricing arrangements are made with the contractor wherein it agrees to
cost ceilings, e.g., a ceiling on overhead rates for conditions other
than those discussed at FAR 42.707. In such circumstances, the
contractor should receive favorable consideration in developing the
profit objective.
(3) Negative factors. Special situations need not be limited to
those which only increase profit levels. A negative consideration may be
appropriate when the contractor is expected to obtain spin-off benefits
as a direct result of the contract (e.g., products or services with
commercial application).
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988]
Sec. 315.905-74 Facilities capital cost of money.
When facilities capital cost of money (cost of capital committed to
facilities) is included as an item of cost in the contractor's proposal,
a reduction in the profit objective shall be made in an amount equal to
the amount of facilities capital cost of money allowed in accordance
with the Facilities Capital Cost-of-Money Cost Principal. If the
contractor does not propose this cost, a provision must be inserted in
the contract that facilities capital cost of money is not an allowable
cost.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988]
Subpart 315.10_Preaward, Award, and Postaward Notifications, Protests,
and Mistakes
Sec. 315.1000 General.
Once a contract action has progressed through the evaluation
process, and even after the selection of a contractor, all queries as to
the relative merits of the submitted proposals shall be courteously but
firmly directed to the contracting officer. All other personnel will
avoid any exchange of comments with offerors.
[49 FR 13979, Apr. 9, 1984. Redesignated and amended at 50 FR 23132, May
31, 1985; 50 FR 38004, Sept. 19, 1985]
Sec. 315.1003 Debriefing of unsuccessful offerors.
(a) Any HHS employee who receives either a written or oral request
for a debriefing from an unsuccessful offeror shall immediately, without
any discussion regarding the merits or deficiencies of the unsuccessful
offeror's proposal, refer the request to the contracting officer. If the
request is made orally, the contracting officer shall require that the
request be made in writing. The contracting officer or his/her designee
shall be present at all debriefings and shall review written debriefings
prior to release.
(b) A debriefing is intended to:
(1) Tell an unsuccessful offeror which areas of its proposal were
judged to be weak and deficient and whether the weaknesses or
deficiencies were factors in its not having been selected; and
(2) Identify the factors which were the basis for selection of the
successful contractor. If the quality of the successful offeror's
proposal to satisfy the mission requirement was the basis, the
unsuccessful offeror should be so informed, and given a general
comparison of significant areas, but not a point-by-point comparison of
all the elements considered in the evaluation criteria. If the
successful offeror was selected on the basis of cost, the unsuccessful
offeror should be told that was the case. If selection was based on
other factors, they should be specified.
[[Page 77]]
(d) If an unsuccessful offeror feels that its failure to obtain the
award was not justified, it will rely, at least in part, on the
information given in the debriefing to determine whether it should seek
recourse. Accordingly, it is essential that a debriefing be conducted in
a scrupulously fair, objective, and impartial manner, and that the
information given the unsuccessful offeror be absolutely factual and
consistent with the findings of the contracting officer and the basis on
which the award was made.
(e) In some cases, it may be necessary to arrange informal
debriefings for an unsuccessful offeror's personnel by departmental
technical evaluators. This determination will be made by, and meeting
arrangements will be the responsibility of, the contracting officer.
(f) It is very important that all departmental personnel engaged in
the evaluation and selection processes be aware of the policies and
procedures in FAR subpart 15.10 and this subpart 315.10. Detailed and
complete records of the acquisition will be maintained by key technical
and contracting personnel in a manner which will facilitate either a
written or an oral debriefing of any unsuccessful offeror.
[49 FR 13979, Apr. 9, 1984. Redesignated and amended at 50 FR 23132, May
31, 1985; 50 FR 38004, Sept. 19, 1985]
Sec. 315.1004 Protests against award.
See subpart 333.1.
[49 FR 13979, Apr. 9, 1984. Redesignated and amended at 50 FR 23132, May
31, 1985; 50 FR 38004, Sept. 19, 1985]
Sec. 315.1005 Discovery of mistakes.
See 314.406 and 315.607.
[49 FR 13979, Apr. 9, 1984. Redesignated at 50 FR 23132, May 31, 1985;
50 FR 38004, Sept. 19, 1985]
Subpart 315.70_Requests for Contract
Sec. 315.7000 Scope of subpart.
This subpart prescribes the format and contents of the request for
contract and provides procedures for the preparation and submission of
the request for contract document.
Sec. 315.7001 General.
The program office's preparation of the request for contract (RFC)
and submission to the contracting activity finalizes the presolicitation
phase of the acquisition planning process and commences the solicitation
phase. The RFC is the formal document which initiates the preparation of
the request for proposals by the contracting activity and sets the
acquisition process in motion. It represents the results of planning by
the project officer and contract negotiator and contains much of the
pertinent information necessary for the development of a sound,
comprehensive RFP.
Sec. 315.7002 Procedures.
(a) Requests for contract are required to be prepared by the program
office for all proposed negotiated acquisitions estimated to exceed the
small purchase limitation.
(b) The program office should submit the RFC as early as possible to
the contracting activity. The proposed period of time between the date
of submission of the RFC and the date of contract award (or date of
delivery of the product, service, study, etc.) should be determined by
the project officer, contract negotiator, and, if necessary, the
contracting officer. The amount of leadtime should be determined on a
case-by-case basis and should reflect the characteristics and
complexities of the individual acquisition. When lengthy and/or involved
clearances or special approval are required, for example, they must be
taken into account when the leadtime is determined. If a formal
acquisition planning document is used, (see subpart 307.1), the RFC
should be submitted in accordance with the timetable set forth in that
document. OPDIV, agency, and regional office contracting activities may
prescribe specific leadtimes for submission of RFC's in their
implementation of this subpart.
[49 FR 13979, Apr. 9, 1984, as amended at 53 FR 15563, May 2, 1988; 56
FR 47003, Sept. 17, 1991]
Sec. 315.7003 Responsibilities.
It is the responsibility of the project officer to prepare the RFC
so that it
[[Page 78]]
complies with the requirements of this subpart and any OPDIV, agency, or
regional office guidance issued in accordance with this subpart. Prior
to the submission of the RFC to the contracting activity, the head of
the program office sponsoring the project shall review the RFC to ensure
that all required information is provided in the prescribed format and a
technical review of the statement of work has been made. The level and
extent of the technical review is to be commensurate with the estimated
cost, importance, and complexity of the proposed acquisition, and must
be thorough enough to ensure that vague and ambiguous language is
eliminated, the statement of work is structured by phases or tasks, if
appropriate, and methods are available for assessing the contractor's
technical, cost, and delivery performances.
Sec. 315.7004 Transmittal.
The RFC will be conveyed to the contracting activity by use of a
covering memorandum or other form of transmittal. The transmittal
document must be signed by the head of the sponsoring program office and
include both a statement attesting to the conclusiveness of the review
discussed in the preceding section and a list identifying all
attachments to the RFC. A standard format for the transmittal document
may be prescribed by the OPDIV, agency, or regional office contracting
activity.
Sec. 315.7005 Format and content.
The Department does not prescribe a standard format for the RFC
document, but recommends the use of a format similar to what is provided
in this section. The subject areas addressed in paragraphs (a) and (b)
must be included in every RFC document, whereas the areas addressed in
paragraph (c) need only be included if applicable. An OPDIV, agency, or
regional office contracting activity may prescribe a standard format for
the RFC document and may include additional subject areas that are
pertinent to that activity's needs. Some of the information to be
furnished in the RFC document may be repetitive of that found in the
acquisition planning document. If this information has not changed since
the development of the acquisition planning document, the RFC document
may either restate the information as it appears in the acquisition
planning document or cross reference the applicable portion where the
information appears.
(a) The RFC document must contain the following:
(1) Purpose of contract. A brief, general description of
requirements, including the citation of the legislation which authorizes
the program or project, is to be provided, along with a statement as to
the intended purpose/use of the proposed contract.
(2) Background and need. The background history and necessity for
the proposed contract are to be described. This section is to include
prior, present, and planned efforts by the program office in the same or
related areas, and a description of efforts by other departmental
activities and Federal agencies in the same or related program areas, if
known. In addition, specific project information such as the relevance
or contribution to overall program objectives, reasons for the need,
priority, and project overlap are to be provided.
(3) Period of performance. The number of months (or other time
period) required for total performance, and, if applicable, for each
phase of work indicated in the statement of work, is to be specified.
The program office must indicate the proposed starting date and the
required date of delivery for each deliverable.
(4) Estimated cost and fund citation. The project officer's estimate
of the total cost of the proposed contract, and, if applicable, the
estimate for each phase indicated in the statement of work, is to be
provided. The project officer must provide a cost breakdown of all
contributing cost factors, to include an estimate of the technical staff
hours, direct materials, subcontracting, travel, etc. The project
officer may consult with contracting and cost advisory personnel in
developing this information. This section must include the certification
of funds availability for the particular proposed acquisition, along
with the appropriation and accounting information citations. When funds
are not currently available
[[Page 79]]
but are anticipated, a statement indicating that the financial plan
includes provision for the funds for the proposed acquisition but the
funds are not yet available for obligation shall be included in lieu of
the certification of funds availability. (Contracts cannot be awarded
unless funds are available, but see FAR 32.703-2.)
(5) Reference material. A list, by title and description, of study
reports, plans, drawings, and other data to be made available to
prospective offerors for use in preparation of proposals and/or the
contractor for use in performance of the contract is to be provided. The
project officer must indicate whether this material is currently
available or when it will be available.
(6) Technical evaluation criteria and instructions. The project
officer is to include the technical evaluation criteria, which have been
developed based on the requirements of the specific project, and any
instructions and information which will assist in the preparation of
prospective offerors' technical proposals. For example, critical areas
discussed in the statement of work and the relative order of importance
and weights assigned to each of these areas for technical evaluation
purposes must be identified. These areas may include understanding of
the problem, technical approach, experience, personnel, facilities, etc.
(7) Sources for solicitation. The project officer is to develop and
include a list of known potential sources by name and mailing address.
The project officer is encouraged to use trade and professional journals
and publications to identify new prospective sources to supplement the
list of known sources. Efforts to identify set-aside possibilities,
i.e., small, disadvantaged, and labor surplus areas, and women-owned
businesses, must be explained.
(8) Special approvals, clearances, and requirements. All special
approvals, clearances, and requirements pertinent to the proposed
acquisition are to be listed in this section. Copies of the actual
documents are to be attached to the RFC. If the approval, clearance, or
requirement has been requested and is being processed, a footnote to
this effect, including all pertinent details, must be included in this
section. A list of Government-wide and Department imposed approvals,
clearances, and requirements is set forth in 307.105-2. Comprehensive
checklists of these and any OPDIV, agency, regional office, etc. special
approvals, clearances, and requirements shall be provided for reference
purposes to program offices by the servicing contracting activity.
(9) Identification and disposition of data. The project officer must
identify the data expected to be generated by the acquisition and
specify the data to be delivered to the Department (see 315.7005(b)(2))
and that to be retained by the contractor. The project officer must also
include information relative to the use, maintenance, disclosure, and
disposition of data. The project officer must include a statement as to
whether or not another acquisition, based upon the data generated by the
proposed acquisition, is anticipated. The project officer must also
include a statement indicating whether the proposed acquisition is or is
not subject to the Privacy Act (see FAR subpart 24.1 and subpart 324.1).
(10) Project officer and alternate. The project officer's name,
title, organization, mailing address, and telephone number are to be
provided in this section, along with the same data for the project
officer's alternate. In addition, a statement that the project officer
has completed the Department's project officer training course is to be
provided (see 307.170).
(b) The following must be submitted with every RFC but are to be
prepared as separate attachments so they may be readily adopted into the
request for proposal format:
(1) Statement of work or specification. The statement of work
describes the requirements to be performed and may describe the methods
to be used (see 307.105-3 and FAR 35.005 for a detailed explanation). A
specification is used in lieu of a statement of work when a clear and
accurate description of the technical requirements for a product,
material, or service can be provided along with the procedure to
determine that the requirements have been met. It is essential that a
complete and comprehensive statement of work or specification be
provided by the project officer.
[[Page 80]]
(2) Schedule of deliverables or reporting requirements. The project
officer must specifically describe what is to be delivered and when it
is to be delivered to ensure proper contract monitoring. Usually,
technical and financial progress reports and the final report are
prescribed in this section. These reports should be tailored to the
instant acquisition and should avoid unnecessary and burdensome
reporting requirements.
(c) The following may not be applicable to all RFC's but must be
included as attachments whenever any do apply:
(1) Government property. The project officer must identify, as
referenced in the statement of work, the types, individual items, and
quantities of Government property to be furnished to or allowed to be
acquired by, the resultant contractor, if known. The project officer
must specify when the Government property is to be made available to the
resultant contractor.
(2) Special terms and conditions. The project officer may suggest
inclusion of any special terms and conditions applicable to the proposed
acquisition not already covered in the statement of work or the
applicable contract general provisions.
(3) Justification for other than full and open competition. If the
proposed acquisition is to be awarded using other than full and open
competition, a justification, prepared in accordance with FAR subpart
6.3 and subpart 306.3, must be submitted as an attachment to the RFC.
(4) Privacy Act ``system notice.'' When the project officer has
determined that the requirements of the Privacy Act are applicable to
the proposed acquisition, a copy of the ``system notice'' must be
attached to the RFC (see 324.103(d)).
[49 FR 13979, Apr. 9, 1984, as amended at 50 FR 23132, May 31, 1985; 50
FR 38004, Sept. 19, 1985]
Sec. 315.7006 Review.
Upon receipt of the RFC, the contracting activity shall review the
contents to ensure that all pertinent information has been provided by
the program office. If pertinent information is missing or if there are
discrepancies in previously agreed upon information, such as significant
alterations in the statement of work, the contracting activity shall
obtain or clarify the information so that the acquisition schedule is
met. If the program office delays furnishing the information or
clarification, the acquisition schedule may have to be changed. When
this circumstance arises, the contracting activity should notify the
head of the sponsoring program office of the problem, in writing, of the
possible slippage in the acquisition schedule, and the need for an
expeditious remedy. If the head of the sponsoring program office is not
responsive to the request for expediency, the matter should be referred
to higher management authorities for resolution.
[49 FR 13979, Apr. 9, 1984, as amended at 49 FR 36110, Sept. 14, 1984]
PART 316_TYPES OF CONTRACTS
Subpart 316.3_Cost-Reimbursement Contracts
Sec.
Sec. 316.301 General.
Sec. 316.301-3 Limitations.
Sec. 316.303 Cost-sharing contracts.
Sec. 316.306 Cost-plus-fixed-fee contracts.
Sec. 316.307 Contract clauses.
Subpart 316.4_Incentive Contracts
Sec. 316.403 Fixed-price incentive contracts.
Subpart 316.6_Time-and-Materials, Labor-Hour, and Letter Contracts
Sec. 316.601 Time-and-materials contracts.
Sec. 316.603 Letter contracts.
Sec. 316.603-2 Application.
Sec. 316.603-3 Limitations.
Sec. 316.603-70 Information to be furnished when requesting authority
to issue a letter contract.
Sec. 316.603-71 Approval for modifications to letter contracts.
Subpart 316.7_Agreements
Sec. 316.702 Basic agreements.
Sec. 316.770 Unauthorized types of agreements.
Sec. 316.770-1 Letters of intent.
Sec. 316.770-2 Memorandums of understanding.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 14004, Apr. 9, 1984, unless otherwise noted.
[[Page 81]]
Subpart 316.3_Cost-Reimbursement Contracts
Sec. 316.301 General.
Sec. 316.301-3 Limitations.
(c) The following format shall be used and executed by the
contracting officer as the determination and findings authorizing the
use of a cost-reimbursement contract and establishing the fee:
Department of Health and Human Services--Determination and Findings
Authority to Use Cost-Reimbursement Contract
I hereby find that:
(1) The (agency title) proposes to contract with (name of proposed
contractor) for (describe work, service, or product) (identify program
or project). The estimated cost is ($___) (if contract is CPFF type,
insert, ``plus a fixed fee of ($___) which is __ percent of the
estimated cost exclusive of fee'').
(2) (Set forth facts and circumstances that show why it is
impracticable to secure property or services of the kind or quantity
required without the use of the proposed type of contract or why the
proposed method of contracting is likely to be less costly than other
methods.) I hereby determine that:
On the basis of the above findings, and in accordance with FAR
16.301-3, it is impracticable to secure the property or services of the
kind or quality required without the use of a (cost, cost-sharing, or
cost-plus-a-fixed fee*) type of contract, or the (cost, cost-sharing, or
cost-plus-a-fixed fee*) method of contracting is likely to be less
costly than other methods.
---------------------------------------------------------------------------
*Use applicable word, words, or statement.
---------------------------------------------------------------------------
Date____________________________________________________________________
Signature_______________________________________________________________
[49 FR 14004, Apr. 9, 1984, as amended at 50 FR 23132, May 31, 1985; 50
FR 38004, Sept. 19, 1985; 51 FR 44294, Dec. 9, 1986]
Sec. 316.303 Cost-sharing contracts.
For detailed information concerning the use of cost-sharing
contracts, see 335.070.
Sec. 316.306 Cost-plus-fixed-fee contracts.
(c)(2) The determination and findings (D&F) required by FAR
16.306(c)(2) has been combined with the D&F required by FAR 16.301-3(c)
authorizing the use of cost-reimbursement contract, and is shown in
316.301-3(c). The contracting officer is responsible for executing the
D&F and is authorized to make both determinations required by the FAR.
[51 FR 44294, Dec. 9, 1986]
Sec. 316.307 Contract clauses.
(a) If the contract is with a hospital (profit or nonprofit), modify
the ``Allowable Cost and Payment'' clause at FAR 52.216-7 by deleting
from paragraph (a) the words ``subpart 31.2 of the Federal Acquisition
Regulation (FAR)'' and substituting ``45 CFR part 74 appendix E.''
(j) The contracting officer shall insert the clause at 352.216-72,
Additional Cost Principles, in solicitations and resultant cost-
reimbursement contracts with nonprofit organizations, as identified in
OMB Circular A-122.
[55 FR 42197, Oct. 18, 1990]
Subpart 316.4_Incentive Contracts
Sec. 316.403 Fixed-price incentive contracts.
(c) The determination and findings required by FAR 16.403(c) shall
be executed by the chief of the contracting office after it is prepared
by the contracting officer.
[51 FR 44294, Dec. 9, 1986]
Subpart 316.6_Time-and-Materials, Labor-Hour, and Letter Contracts
Sec. 316.601 Time-and-materials contracts.
(c) Limitations. The format prescribed in 316.301-3(c) shall be used
and executed by the contracting officer as the determination and
findings authorizing the use of either a time-and-materials contract or
a labor-hour contract, except that the final paragraph shall be changed
to read as follows:
I hereby determine that:
On the basis of the above findings, no other type of contract will
suitably serve for the acquisition of the required work or services.
Sec. 316.603 Letter contracts.
Sec. 316.603-2 Application.
It is the policy of the Department to refrain from issuing letter
contracts.
[[Page 82]]
Exceptions to this policy will be permitted only in those cases where
all matters of a substantive nature, such as statements of work,
delivery schedules, and general and special clauses have been resolved
and agreed upon.
Sec. 316.603-3 Limitations.
The principal official responsible for acquisition shall be the
approving official who executes the prescribed written statement.
However, if the principal official responsible for acquisition is to
sign the letter contract as the contracting officer, the approving
official becomes the head of the contracting activity.
[49 FR 14004, Apr. 9, 1984, as amended at 51 FR 44294, Dec. 9, 1986]
Sec. 316.603-70 Information to be furnished when requesting authority
to issue a letter contract.
The following information should be included by the contracting
officer in any memorandum requesting approval to issue a letter
contract:
(a) Name and address of proposed contractor.
(b) Location where contract is to be performed.
(c) Contract number, including modification number, if possible.
(d) Brief description of work and services to be performed.
(e) Performance or delivery schedule.
(f) Amount of letter contract.
(g) Estimated total amount of definitized contract.
(h) Type of definitive contract to be executed (fixed price, cost-
reimbursement, etc.).
(i) Statement of the necessity and advantage to the Government of
the use of the proposed letter contract.
(j) Statement of percentage of the estimated cost that the
obligation of funds represents. In rare instances where the obligation
represents 50 percent or more of the proposed estimated cost of the
acquisition, a justification for that obligation must be included which
would indicate the basis and necessity for the obligation (e.g., the
contractor requires a large initial outlay of funds for major
subcontract awards or an extensive purchase of materials to meet an
urgent delivery requirement). In every case, documentation must assure
that the amount to be obligated is not in excess of an amount reasonably
required to perform the work.
(k) Period of effectiveness of the proposed letter contract. If more
than 180 days, complete justification must be given.
(l) Statement of any substantive matters that need to be resolved.
Sec. 316.603-71 Approval for modifications to letter contracts.
All letter contract modifications (amendments) must be approved by
the principal official responsible for acquisition. Requests for
authority to issue letter contract modifications shall be processed in
the same manner as requests for authority to issue letter contracts and
shall include the following:
(a) Name and address of the contractor.
(b) Description of work and services.
(c) Date original request was approved and indicate approving
official.
(d) Letter contract number and date issued.
(e) Complete justification as to why the letter contract cannot be
definitized at this time.
(f) Complete justification as to why the level of funding must be
increased.
(g) Complete justification as to why the period of effectiveness is
increased beyond 180 days, if applicable.
(h) If the funding of the letter contract is to be increased to more
than 50 percent of the estimated cost of the acquisition, the
information required by 316.603-70(j) must be included.
Subpart 316.7_Agreements
Sec. 316.702 Basic agreements.
(b) Application.
(2) Basic agreements shall continue in effect until termination,
supersession, or expiration of the term.
(d) Contracts incorporating basic agreements.
(2) Any provision of a contract which conflicts with the terms of a
basic agreement must be approved by the Director, Division of
Acquisition Policy, OAGM.
[[Page 83]]
(4) Basic agreements may include negotiated overhead rates for cost-
reimbursement type contracts. Where negotiated overhead rates are
included, the bases to which the rates apply and the period of
applicability must also be stated. All pertinent provisions such as
final rates for past periods, provisional rates for current or future
periods, ceilings, and any specific items to be treated as indirect
costs shall also be included as appropriate.
(e) Content and format. A basic agreement shall consist of an
execution page(s), contents page, special provisions, and general
provisions. The following is illustrative of an execution page:
Basic Agreement Page 1 of--
Number pages
Basic Agreement
Between the United States of America, as represented by the
Department of Health and Human Services, and (Name of Contractor), this
agreement, effective (Insert Date) by and between the United States of
America, hereinafter called the ``Government,'' as represented by the
Department of Health and Human Services, and (Name of Contractor), a
corporation organized and existing under the laws of the (State/
Commonwealth) of ____ with its principal office in (City, State),
hereinafter called the ``Contractor''.
Witnesseth That
Whereas, the Government and the Contractor desire to enter into a
single basic agreement for use only in connection ith negotiated (insert
type of contract and categories of effort that the basic agreement will
cover) entered into on or after the effective date of this Agreement,
and prior to its termination; and
Whereas, the parties understand that this Agreement shall not in any
manner provide for or imply any agreement on the part of the Government
to place future orders or contracts with the Contractor.
Now therefore, the Government and the Contractor agree that the
provisions and clauses of the Special Provisions, as set forth herein,
and the General Provisions, as set forth and modified herein, shall be
incorporated in and constitute the terms and conditions applicable to
all negotiated (insert type of contract and categories of effort that
the basic agreement will cover) entered into on or after the effective
date of this Agreement, and prior to its termination.
In witness whereof, the parties hereto have executed this Agreement
as of the day and year first above written.
United States of America
Name of Contractor______________________________________________________
_______________________________________________________________________
Signature of Contracting Officer
By______________________________________________________________________
Signature of Authorized Official
Typed name______________________________________________________________
Typed name______________________________________________________________
Date____________________________________________________________________
(f) Procedures. (1) Negotiation of basic agreements may be
undertaken by OPDIV contracting activities on behalf of the Department.
When an OPDIV contracting activity decides to negotiate a basic
agreement with an organization, prior authorization must be requested,
in writing, from the Director, Division of Acquisition Policy (DAP).
When the Director, DAP, gives written authorization to the OPDIV
contracting activity designated to conduct negotiations on behalf of the
Department, all other OPDIVs will be notified of this designation. If
another OPDIV elects, it may attend the negotiation or furnish special
terms and conditions or provisions for inclusion in the proposed basic
agreement by advising the designated negotiating activity in writing
within ten (10) days from the date of the authorization. After review
and resolution of all requests for inclusion of special terms and
conditions or provisions, the designated negotiating activity will
invite those OPDIVs which expressed an interest in attending the
negotiations and make the necessary arrangements for the negotiation of
the basic agreement.
(2) Prior to the conclusion of negotiations, the designated
negotiating activity shall furnish the OPDIVs a draft copy of the
proposed basic agreement together with:
(i) A resume of all salient features of the basic agreement which
will facilitate review;
(ii) Any of the negotiating OPDIV's guides or procedures which are
being considered for incorporation into the basic agreement by
reference;
(iii) A listing of nonstandard clauses used, the genesis of such
clauses, and the reasons for such clauses in the basic agreement; and
(iv) The contractor's comments, including the basis for requesting
any deviation from the HHSAR and the designated negotiating activity's
position with respect thereto.
[[Page 84]]
(3) The OPDIVs shall have fifteen (15) days from the date of the
memorandum transmitting the information to submit comments on the draft
copy of the basic agreement. After receipt, analysis, and resolution of
the comments of the OPDIVs, the designated negotiating activity will
proceed to conclude the negotiation of the basic agreement.
(4) After conclusion of the negotiation, but prior to execution of
the basic agreement, a copy of the basic agreement, together with the
information specified in paragraph (f)(2) above, the comments of the
OPDIVs, the designated negotiating activity's analysis of the OPDIV
comments, and the basis for the action taken will be furnished to the
Director, DAP for review by DPP and the Office of General Counsel.
Approval by the Director, DAP must be given prior to the execution of
the basic agreement. After approval and execution of the basic
agreement, the designated negotiating activity will distribute the
executed document to the OPDIVs, Office of General Counsel, and the
Director, DAP. The basic agreement is mandatory for use by all
activities of the Department for all acquisitions falling within the
scope of the basic agreement.
[49 FR 14004, Apr. 9, 1984, as amended at 50 FR 23126, 23133, May 31,
1985; 50 FR 38004, Sept. 19, 1985; 54 FR 24343 June 7, 1989; 54 FR
24343, June 7, 1989]
Sec. 316.770 Unauthorized types of agreements.
Sec. 316.770-1 Letters of intent.
A letter of intent is an informal unauthorized agreement between the
Government and a prospective contractor which indicates that products or
services will be produced after completion of funding and/or other
contractual formalities. Letters of intent are often solicited by
prospective contractors or may be originated by Government personnel.
Letters of intent are not authorized by the FAR and are prohibited for
use by Department personnel.
Sec. 316.770-2 Memorandums of understanding.
A ``memorandum of understanding'' is an unauthorized agreement,
usually drafted during the course of negotiations, to modify mandatory
FAR and HHSAR provisions in such a manner as to make them more
acceptable to a prospective contractor. It may be used to bind the
contracting officer in attempting to exercise rights given the
Government under the contract, or may contain other matters directly
contrary to the language of the solicitation or prospective contractual
document. Use of such memorandums of understanding is not authorized.
Any change in a solicitation or contract shall be made by amendment or
modification to that document. When a change to a prescribed contract
clause is considered necessary, a deviation shall be requested.
PART 317_SPECIAL CONTRACTING METHODS
Subpart 317.2_Options
Sec.
Sec. 317.201 Definition.
Sec. 317.202 Use of options.
Sec. 317.203 Solicitations.
Sec. 317.206 Evaluation.
Subpart 317.70_Consolidated Acquisitions
Sec. 317.7001 General.
Sec. 317.7002 Policy.
Subpart 317.71_Supply and Service Acquisitions Under the Government
Employees Training Act
Sec. 317.7100 Scope of subpart.
Sec. 317.7101 Applicable regulations.
Sec. 317.7102 Acquisition of training.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 14006, Apr. 9, 1984, unless otherwise noted.
Subpart 317.2_Options
Sec. 317.201 Definition.
(a) An option must:
(1) Identify the supplies or services as a discrete option quantity
in addition to the basic quantity of supplies or services to be
delivered under the initial contract award;
(2) Establish a price or specify a method of calculation which will
make the price certain;
(3) Be agreed to and included in the initial contract award; and
[[Page 85]]
(4) Permit the Government the right to exercise the option
unilaterally.
(b) Contract provisions which provide the Government the right to
buy additional requirements, subject to the written agreement of the
contractor, do not meet the requirements of paragraph (a)(4) of this
section and are not authorized. Further, any contract provision which
merely extends the initial contract period without requiring delivery of
additional supplies or services is not an option.
Sec. 317.202 Use of options.
(c)(6) The primary purpose for inclusion would be the achievement of
administrative convenience.
Sec. 317.203 Solicitations.
(g)(2) When unusual circumstances exist, the principal official
responsible for acquisition (not delegable) may approve a greater
percentage (but see FAR 17.205).
Sec. 317.206 Evaluation.
The determination referenced in FAR 17.206(b) shall be made by the
chief of the contracting office.
[49 FR 14006, Apr. 9, 1984, as amended at 53 FR 43208, Oct. 26, 1988]
Subpart 317.70_Consolidated Acquisitions
Sec. 317.7001 General.
Studies have indicated that substantial savings can be realized
through centralized and consolidated acquisitions of common use
supplies, services, and equipment. The Department has identified common
use items and has applied the principle of consolidated acquisition to
these items.
Sec. 317.7002 Policy.
(a) The following supplies, services, and equipment have been
indentified as common use items and are to be acquired by the
centralized contracting activity identified in paragraph (b):
(1) Administrative supplies, equipment, and services (i.e., general
use office items or related services), as distinguished from functional
or program requirements.
(2) Automated data processing services (but see ADP Systems Manual,
Chapter 4).
(3) Stenographic reporting services.
(4) Visual arts, graphics, and supplementing services.
(5) Press clipping services.
(b) Activities within the metropolitan Washington, DC area are
required to submit purchase requests for the above items to the
applicable centralized contracting activity as follows:
(1) Activities located in the Southwest Washington complex;
Procurement Branch, Division of Contract Operations, Office of
Acquisition and Grants Management, Office of the Secretary.
(2) Parklawn Complex, Rockville, Maryland (Montgomery and Prince
Georges Counties area); Division of Acquisition Management,
Administrative Services Center, Office of Management, Public Health
Service.
(3) National Institutes of Health; Division of Procurement, National
Institutes of Health.
(c) Activities outside the metropolitan Washington, DC area are
encouraged to establish centralized points to conduct acquisitions for
common use items.
[49 FR 14006, Apr. 9, 1984, as amended at 54 FR 24343, June 7, 1989; 55
FR 13536, Apr. 11, 1990]
Subpart 317.71_Supply and Service Acquisitions Under the Government
Employees Training Act
Source: 53 FR 43208, Oct. 26, 1988, unless otherwise noted.
Sec. 317.7100 Scope of subpart.
This subpart provides alternate methods for obtaining training in
non-Government facilities under the Government Employees Training Act, 5
U.S.C. chapter 41.
Sec. 317.7101 Applicable regulations.
Basic policy, standards, and delegations of authority to approve
training are contained in HHS Personnel Manual Instruction 410-1.
[[Page 86]]
Sec. 317.7102 Acquisition of training.
(a) The acquisition of interagency training courses and non-
governmental off-the-shelf training courses, whether for individual
employees or for groups of employees, is the responsibility of the
Assistant Secretary for Personnel Administration.
(b) Non-governmental training must be acquired through the
contracting office if there are costs for training course development or
for modification of off-the-shelf training courses.
[[Page 87]]
SUBCHAPTER D_SOCIOECONOMIC PROGRAMS
PART 319_SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS CONCERNS
Subpart 319.2_Policies
Sec.
Sec. 319.201 General policy.
Sec. 319.201-70 Small and disadvantaged business utilization
specialist.
Sec. 319.270 Federal acquisition conferences.
Subpart 319.5_Set-Asides for Small Business
Sec. 319.501 General.
Sec. 319.503 Setting aside a class of acquisitions.
Sec. 319.503-70 Small business class set-aside for construction,
repair, and alteration work.
Sec. 319.505 Rejecting set-aside recommendations.
Sec. 319.506 Withdrawing or modifying set-asides.
Sec. 319.570 Contract payments.
Subpart 319.7_Subcontracting With Small Business and Small Disadvantaged
Business Concerns
Sec. 319.705 Responsibilities of the contracting officer under the
subcontracting assistance program.
Sec. 319.705-2 Determining the need for a subcontracting plan.
Sec. 319.705-3 Preparing the solicitation.
Sec. 319.705-4 Reviewing the subcontracting plan.
Sec. 319.705-5 Awards involving subcontracting plans.
Sec. 319.705-6 Postaward responsibilities of the contracting officer.
Sec. 319.706 Responsibilities of the cognizant administrative
contracting officer.
Subpart 319.8_Contracting With the Small Business Administration (the
8(a) Program)
Sec. 319.800 General.
Sec. 319.803 Selecting acquisitions for the 8(a) Program.
Sec. 319.812 Contract administration.
Sec. 319.870 Liaison with the Small Business Administration.
Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).
Source: 49 FR 14007, Apr. 9, 1984, unless otherwise noted.
Subpart 319.2_Policies
Sec. 319.201 General policy.
(c) The functional management responsibilities for the Department's
small business, disadvantaged business, and labor surplus area programs
are delegated to the Director of the Office of Small and Disadvantaged
Business Utilization (OSDBU).
(1) The Director, OSDBU is responsible for:
(i) Recommending to the Under Secretary overall Department-wide
operating concepts and policies relating to the Department's small
business, disadvantaged business, and labor surplus area programs;
(ii) Implementing policy decisions through the issuance of operating
procedures (Operating Divisions (OPDIVs) may develop alternative
procedures for achieving departmental policy goals, and objectives.
However, any change in procedures must be approved by the Under
Secretary);
(iii) Reviewing and evaluating the Department's policies, practices,
and procedures pertaining to the disadvantaged business, small business,
and labor surplus area programs, as well as recommending changes or
corrective actions to the OPDIV heads or to the Under Secretary, as
appropriate;
(iv) Providing the Under Secretary with regular appraisals of
performance and quality of effort, including timely notification of
significant problems, events, and accomplishments, and the need for
changes in Department-wide objectives and policies; and
(v) Providing technical assistance and support to the small and
disadvantaged business utilization specialists.
(2) The Director, OSDBU is authorized to:
(i) Establish standards, procedures and operating guidelines
controlling the manner in which the small business, disadvantaged
business, and labor surplus area programs are conducted throughout the
Department;
(ii) Provide advice on proposed allocations of personnel, funds, and
other resources in light of the total needs of the Department;
[[Page 88]]
(iii) Prescribe, after coordination with appropriate concerned
personnel, reporting requirements necessary to preserve openness in
reporting, identifying emerging problems, monitor Department-wide
activity, and provide a basis for appraisal and evaluation of
performance. To the maximum extent, these reporting requirements will be
satisfied through existing Department-wide reporting systems or by
making modifications to them;
(iv) Conduct surveys and review of operating practices in the OPDIVs
and regional offices; and
(v) Communicate directly with the small and disadvantaged business
utilization specialists to assist them in carrying out their individual
and collective responsibilities.
Sec. 319.201-70 Small and disadvantaged business utilization
specialist.
(a) The Head of each OPDIV shall appoint a qualified full time small
and disadvantaged business utilization specialist (SADBUS) in the
following activities: Office of Human Development Services (OHDS),
Health Care Financing Administration (HCFA), Social Security
Administration (SSA), Public Health Service (PHS), to include the Food
and Drug Administration (FDA), Health Resources and Services
Administration (HRSA) (and each regional Office of Engineering
Services), Indian Health Service (IHS), National Institutes of Health
(NIH), Alcohol, Drug Abuse, and Mental Health Administration (ADAMHA),
Centers for Disease Control (CDC), and Administrative Services Center
(ASC). A SADBUS shall also be appointed for the Office of the Secretary
(OS) and for each Regional Office. As deemed necessary, additional small
and disadvantaged business utilization specialists may be appointed in
larger contracting activities.
(b) When the volume of contracting does not warrant assignment of a
full-time SADBUS, an individual shall be appointed as the specialist on
a part-time basis. The responsibilities of this assignment shall take
precedence over other responsibilities. The specialist shall be
responsible directly to the appointing authority and shall be at an
organizational level outside the direct acquisition chain of command,
i.e., should report directly to the principal official responsible for
acquistion, where appropriate.
(c) The Director, OSDBU will exercise functional management
authority over small and disadvantaged business utilization specialist
regarding small business, disadvantaged business, and labor surplus area
matters. Appointments of SADBUS's shall only be made after consultation
with the Director, OSDBU. A copy of each appointment and termination of
appointment of specialists shall be forwarded to the Director, OSDBU.
(d) The SADBUS shall perform the following duties, as determined to
be appropriate to the activity by the appointing official or by the
Director, OSDBU. The SADBUS shall:
(1) Maintain a program designed to locate capable small business,
disadvantaged business, women-owned business and labor surplus area
business sources for current and future acquisitions, through SBA or by
using other methods, establish appropriate source lists for each
category, and work closely with contracting and small purchasing offices
to ensure offers are solicited from firms on the source lists;
(2) Coordinate inquiries and requests for advice from small
business, disadvantaged business, women-owned business, and labor
surplus area business concerns on acquisition matters, and counsel them
with respect to business opportunities to enhance their potential
participation in the Department's acquisition program;
(3) Prior to the issuance of solicitations (or contract
modifications for additional supplies or services) in excess of the
small purchase limitation, which have not been reviewed, reserved, or
set-aside by the contracting officer, review the contracting officer's
justification for such action;
(4) Assure that small business, disadvantaged business, women-owned
business, and labor surplus area concerns are provided adequate
specifications or drawings by initiating actions, in writing, with
appropriate technical and contracting personnel to ensure that all
necessary specifications or
[[Page 89]]
drawings for current and future acquisitions, as appropriate, are
available;
(5) Review proposed requirements for possible breakout of items
suitable for acquisitions from small business, disadvantaged business,
women-owned business, and labor surplus area concerns;
(6) Assure that financial assistance, available under existing
regulations, is offered, and that requests by small business concerns
for proper assistance are not treated as a handicap in the award of
contracts;
(7) Participate in determinations concerning responsibility of
prospective contractors whenever small business concerns are involved;
(8) Participate in the evaluation of a prime contractor's small
business, labor surplus area, and disadvantaged business subcontracting
plans;
(9) Advise and assist contracting officers in discharging their
responsibilities by:
(i) Monitoring and reviewing contractor performance to determine
compliance with small and small disadvantaged business subcontracting
plans, and
(ii) Developing and maintaining records and reports that reflect
such compliance or noncompliance;
(10) Review and make appropriate recommendations to the contracting
officer on proposals to furnish Government-owned facilities to
contractors if this action may enhance the small business program;
(11) Assure that the participation of small businesses,
disadvantaged businesses, women-owned business, and labor surplus area
concerns is accurately reported;
(12) Make available to SBA copies of solicitations when so
requested;
(13) When a bid or offer from a small business, disadvantaged
business, women-owned business, or labor surplus area concern has been
rejected for nonresponsiveness or nonresponsibility, upon request, aid,
counsel and assist that firm in understanding requirements for
responsiveness and responsibility so that the firm may be able to
qualify for future awards;
(14) Participate in government-industry conferences to assist small
business, disadvantaged business, women-owned business, and labor
surplus area concerns, including Business Opportunity/ Federal
Acquisition Conferences, Minority Business Enterprises Acquisition
Seminars, and Business Opportunity Committee meetings;
(15) Advise potential sources how they can obtain information about
sealed bid and negotiated acquisitions;
(16) Brief the head of the contracting activity at least once
quarterly concerning the status of the activity's small business,
disadvantaged business, women-owned business, and labor surplus area
programs in relation to goals and objectives established;
(17) Participate in the development, implementation, and review of
automated source systems to assure that the interests of small business,
disadvantaged business, women-owned business, and labor surplus area
concerns are fully considered;
(18) Assure that the organization maintains a list of products and
services which are categorized as repetitive small business set-aside;
(19) Provide small business, disadvantaged business, women-owned
business, and labor surplus area concerns information regarding
assistance available from Federal agencies such as the Small Business
Administration, Minority Business Development Agency, Bureau of Indian
Affairs, Economic Development Administration, National Science
Foundation, Department of Labor, and others, including State agencies
and trade associations;
(20) Be responsible for establishing an education and training
program for personnel whose duties and functions affect the activity's
small business, disadvantaged business, women-owned business, and labor
surplus areas programs; and
(21) Participate in interagency programs relating to small business,
disadvantaged business, women-owned business, and labor surplus area
matters as authorized by the Director, OSDBU.
[49 FR 14007, Apr. 9, 1984, as amended at 50 FR 23126, 23133, May 31,
1985; 50 FR 38004, Sept. 19, 1985; 54 FR 24343, June 7, 1989; 57 FR
11690, Apr. 7, 1992]
[[Page 90]]
Sec. 319.270 Federal acquisition conferences.
The Department of Commerce is responsible for coordinating the
participation of Federal civilian agencies in a continuing series of
conferences which are sponsored by members of Congress. The objectives
of these conferences are:
(a) Location of additional acquisition sources to broaden the
acquisition base of Federal agencies;
(b) Stimulation of local, regional, and national economic growth,
national security, and cost reduction;
(c) Location of underutilized production capacity;
(d) Prevention or elimination of pockets of underemployment; and
(e) Assistance of small and small disadvantaged business concerns.
As notified by the OSDBU, contracting activities shall provide
appropriate SADBUS or acquisition personnel to participate in person-to-
person counseling at these conferences. Ordinarily, participation by
contracting activities will be restricted to conferences held within the
geographical areas adjacent to their officers. The brochure, ``How To Do
Business With DHHS'' should be of great assistance in this counseling as
it has been specifically prepared to assist individuals, firms, and
institutions who may wish to do business with this Department. It
contains a brief description of the mission and programs of HHS and its
Operating Divisions and provides a listing of contracting offices and
the types of services and commodities acquired by each.
Subpart 319.5_Set-Asides for Small Business
Sec. 319.501 General.
(c) Prior to the contracting officer's review, the SADBUS shall
review each proposed acquisition to determine the feasibility of
recommending award to the Small Business Administration (SBA) pursuant
to section 8(a) of the Small Business Act. When it cannot be awarded to
SBA pursuant to section 8(a), the SADBUS shall review the proposed
acquisition to determine if it can be recommended as a set-aside under
one of the set-aside priorities stated in FAR 19.504. The SADBUS's
recommendation shall be entered on Form HHS-653, Small Business-Labor
Surplus Set-Aside Review Form, with the reasons for the type of set-
aside recommended, or the reasons for not recommending a set-aside, and
provided to the contracting officer. Upon receipt of the Form HHS-653,
the contracting officer shall promptly concur or nonconcur with the
SADBUS's recommendation. The contracting officer will make the final
determination as to whether the proposed acquisition will be set-aside
or not. If the contracting officer approves the SADBUS's set-aside
recommendation, the proposed acquisition will be set-aside as specified.
However, if the contracting officer disapproves the SADBUS's set-aside
recommendation, the reasons must be documented on the Form HHS-653, and
the form signed. (See 319.505 for options available to the SADBUS
regarding the contracting officer's disapproval of a set-aside
recommendation.) In all cases, the completed Form HHS-653 is to be
retained by the contracting officer and placed in the contract file.
[57 FR 11690, Apr. 7, 1992]
Sec. 319.503 Setting aside a class of acquisitions.
Sec. 319.503-70 Small business class set-aside for construction,
repair, and alteration work.
A small business class set-aside is considered to have been made for
each proposed acquisition for construction, repair, and alteration work
in an estimated amount ranging from $2,500 to $2 million. Accordingly,
the contracting officer shall set aside for small business each proposed
acquisition. If, in his/her judgment, the particular acquisition falling
within the dollar limits specified above is unsuitable for a set-aside
for exclusive small business participation, the procedure set forth in
FAR 19.506 shall apply. Proposed acquisitions for construction, repair,
and alteration work in an estimated amount of more than $2 million shall
be processed on a case by case basis.
Sec. 319.505 Rejecting set-aside recommendations.
(a) If the contracting officer rejects the SADBUS's recommendation
for a
[[Page 91]]
set-aside and an SBA procurement center representative (PCR) is not
assigned or available, the SADBUS may appeal, in writing, to the head of
the contracting activity (HCA) or his/her designee. The SADBUS shall
provide the HCA or designee all the pertinent information concerning the
set-aside disagreement, and the HCA shall respond in writing within
seven business days. The HCA's decision is final and not appealable. The
decision by the HCA shall be attached to the Form HHS-653 and placed in
the contract file. After receipt of a final decision by the HCA, and if
the decision approves the action of the contracting officer, the SADBUS
shall forward, for information and management purposes, complete
documentation of the case to the OSDBU Director. Documentation
transmitted shall include, as a minimum, a copy of the appeal memorandum
submitted to the HCA, a copy of the IFB or RFP, a list of proposed
sources, a copy of the Form HHS-653 and attachments completed by the
SADBUS and the contracting officer, a copy of the HCA's decision, and
all other written material considered by the HCA in arriving at the
decision. The SADBUS' transmittal memorandum shall contain an
affirmative statement that the attachments constitute the complete file
reviewed and considered by the HCA in making the final decision.
If an SBA PCR is assigned or available and the SADBUS refers the
case to that person, the SBA PCR may either concur with the decision of
the contracting officer not to set-aside the proposed acquisition or
recommend to the contracting officer that it be set-aside. For the SBA
PCR to make a comprehensive review, at least the following should be
provided as attachments to the Form HHS-653: the statement of work,
evaluation criteria, Government cost estimate, source list including
size of firms, and a copy of any justification for other than small
business considerations that may be applicable. Once the case has been
referred to the SBA PCR, no further appeal action shall be taken by the
SADBUS. (Refer to FAR 19.505 for the procedures available to the SBA PCR
if the contracting officer rejects the set-aside recommendation.)
[49 FR 14007, Apr. 9, 1984, as amended at 57 FR 11690, Apr. 7, 1992]
Sec. 319.506 Withdrawing or modifying set-asides.
(b) If an SBA PCR is not assigned, the disagreement between the
contracting officer and the SADBUS shall be referred to the HCA for
resolution.
(d) Immediately upon notice from the contracting officer, the SADBUS
shall provide telephone notification regarding all set-aside withdrawals
to the OSDBU Director.
Sec. 319.570 Contract payments.
Contract payments to small business concerns must be made on a
timely basis. Payment of an invoice or voucher must be made within 30
days after receipt of the invoice or voucher or from acceptance of the
goods or services. Each invoice or voucher from a small business concern
not sent directly to the servicing finance office, but received by the
contracting activity, shall be stamped or otherwise identified for
expedited payment before it is forwarded to the servicing finance
office.
Subpart 319.7_Subcontracting With Small Business and Small Disadvantaged
Business Concerns
Sec. 319.705 Responsibilities of the contracting officer under the
subcontracting assistance program.