[Title 48 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 2008 Edition]
[From the U.S. Government Printing Office]



[[Page i]]

          
          
          48


          Chapters 3 to 6

                         Revised as of October 1, 2008


          Federal Acquisition Regulations System
          
          


________________________

          Containing a codification of documents of general 
          applicability and future effect

          As of October 1, 2008
          With Ancillaries
                    Published by
                    Office of the Federal Register
                    National Archives and Records
                    Administration
                    A Special Edition of the Federal Register

[[Page ii]]

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[[Page iii]]




                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 48:
          Chapter 3--Health and Human Services                       3
          Chapter 4--Department of Agriculture                      99
          Chapter 5--General Services Administration               163
          Chapter 6--Department of State                           309
  Finding Aids:
      Table of CFR Titles and Chapters........................     397
      Alphabetical List of Agencies Appearing in the CFR......     417
      List of CFR Sections Affected...........................     427

[[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 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
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

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, October 1, 2008), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
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Code a note has been inserted to reflect the future effective date. In 
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inserted following the text.

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 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
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INCORPORATION BY REFERENCE

    What is incorporation by reference? Incorporation by reference was 
established by statute and allows Federal agencies to meet the 
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This material, like any other properly issued regulation, has the force 
of law.
    What is a proper incorporation by reference? The Director of the 
Federal Register will approve an incorporation by reference only when 
the requirements of 1 CFR part 51 are met. Some of the elements on which 
approval is based are:
    (a) The incorporation will substantially reduce the volume of 
material published in the Federal Register.
    (b) The matter incorporated is in fact available to the extent 
necessary to afford fairness and uniformity in the administrative 
process.
    (c) The incorporating document is drafted and submitted for 
publication in accordance with 1 CFR part 51.
    Properly approved incorporations by reference in this volume are 
listed in the Finding Aids at the end of this volume.
    What if the material incorporated by reference cannot be found? If 
you have any problem locating or obtaining a copy of material listed in 
the Finding Aids of this volume as an approved incorporation by 
reference, please contact the agency that issued the regulation 
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20408, or call 202-741-6010.

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This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

[[Page vii]]


REPUBLICATION OF MATERIAL

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    Raymond A. Mosley,
    Director,
    Office of the Federal Register.
    October 1, 2008.







[[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, 2008.

    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, Cheryl E. Sirofchuck was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Michael L. White, assisted by Ann Worley.

[[Page 1]]



            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM




                  (This book contains chapters 3 to 6)

  --------------------------------------------------------------------
                                                                    Part

chapter 3--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--HEALTH AND HUMAN SERVICES




                           (Parts 300 to 399)

  --------------------------------------------------------------------


  Editorial Note: Nomenclature changes to chapter 3 appear at 70 FR 39, 
Jan. 3, 2005.

                          SUBCHAPTER A--GENERAL
Part                                                                Page
301             HHS Acquisition Regulation System...........           5
302             Definitions of words and terms..............          11
303             Improper business practices and personal 
                    conflicts of interest...................          12
304             Administrative matters......................          14
           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING
305             Publicizing contract actions................          17
306             Competition requirements....................          17
307             Acquisition planning........................          19
309             Contractor qualifications...................          30
311             Describing agency needs.....................          32
312             Acquisition of commercial items.............          32
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
313             Simplified acquisition procedures...........          34
314             Sealed bidding..............................          34
315             Contracting by negotiation..................          35
316             Types of contracts..........................          51
317             Special contracting methods.................          52
                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
319             Small business programs.....................          54
323             Environment, energy and water efficiency, 
                    renewable energy technologies, 
                    occupational safety, and drug-free 
                    workplace...............................          55
324             Protection of privacy and freedom of 
                    information.............................          55
             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
328             Bonds and insurance.........................          59
330             Cost accounting standards...................          59

[[Page 4]]

332             Contract financing..........................          59
333             Protests, disputes, and appeals.............          61
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
335             Research and development contracting........          66
339             Acquisition of information technology.......          67
                    SUBCHAPTER G--CONTRACT MANAGEMENT
342             Contract administration.....................          69
                     SUBCHAPTER H--CLAUSES AND FORMS
352             Solicitation provisions and contract clauses          74
353             Forms.......................................          91
                   SUBCHAPTER T--HHS SUPPLEMENTATIONS
370             Special programs affecting acquisition......          92

[[Page 5]]



                          SUBCHAPTER A_GENERAL





PART 301_HHS ACQUISITION REGULATION SYSTEM--Table of Contents




               Subpart 301.1_Purpose, Authority, Issuance

Sec.
301.101 Purpose.
301.103 Authority
301.106 OMB approval under the Paperwork Reduction Act.

                      Subpart 301.2_Administration

301.270 Executive Committee for Acquisition.

                  Subpart 301.4_Deviations from the FAR

301.403 Individual deviations.
301.404 Class deviations.
301.470 Procedure.

      Subpart 301.6_Career Development, Contracting Authority, and 
                            Responsibilities

301.602 Contracting officers.
301.602-3 Ratification of unauthorized commitments.
301.603 Selection, appointment, and termination of appointment of 
          Contracting Officers/Contract Specialists.
301.603-1 General.
301.603-2 Selection of Contracting Officers.
301.603-3 Appointment of Contracting Officers.
301.603-4 Termination or revocation of a Contracting Officer's 
          appointment.
301.603-70 Delegation of Contracting Officer responsibilities.
301.603-71 Waivers to warrant standards.
301.603-72 Training and certification requirements for Contracting 
          Officers/Contract Specialists.
301.603-73 Earned value training requirement for Contracting Officers/
          Contract Specialists who administer an IT contract.
301.603-74 Training policy exception.
301.603-75 Training requirement for purchase cardholders, Approving 
          Officials (AOs), and Agency/Organization Program Coordinators 
          (A/OPCs).
301.603-76 Requirement for certification retention and maintaining 
          currency of acquisition knowledge and skills for Contracting 
          Officers/Contract Specialists and purchasing agents.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4220, Jan. 17, 2001, unless otherwise noted.



               Subpart 301.1_Purpose, Authority, Issuance



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 FAR policies and procedures and provides 
additional policies and procedures that supplement the FAR to satisfy 
the needs of HHS.
    (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.

[66 FR 4220, Jan. 17, 2001, as amended at 71 FR 76488, Dec. 20, 2006]



301.103  Authority.

    (b) The HHSAR is prescribed by the Assistant Secretary for 
Administration and Management 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.
    (c) 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.''



301.106  OMB approval under the Paperwork Reduction Act.

    (a) The following OMB control numbers apply to the information 
collection and recordkeeping requirements contained in this chapter:

------------------------------------------------------------------------
                                                             OMB control
                       HHSAR segment                             No.
------------------------------------------------------------------------
315.4......................................................    0990-0139
324.70.....................................................    0990-0136
342.7101...................................................    0990-0131
352.224-70.................................................    0990-0137
352.224-70.................................................    0990-0136

[[Page 6]]

 
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
352.270-8..................................................    0990-0128
352.270-9..................................................    0990-0128
370.1......................................................    0990-0129
370.2......................................................    0990-0129
------------------------------------------------------------------------

    (b) 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.).



                      Subpart 301.2_Administration



301.270  Executive Committee for Acquisition.

    (a) The Deputy Assistant Secretary for Acquisition Management and 
Policy 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 Division of 
Acquisition Policy (DAP), Agency for Healthcare Research and Quality, 
Centers for Medicare & Medicaid Services, Program Support Center, 
Centers for Disease Control and Prevention, Food and Drug 
Administration, Health Resources and Services Administration, Indian 
Health Service, National Institutes of Health, and Substance Abuse and 
Mental Health Services Administration. The ECA is chaired by the 
Director, Division of Acquisition Policy (DAP). All meetings will be 
held at the call of the Chair, and all activities will be carried out 
under the direction of the Chair.
    (c) The purposes of the ECA are to:
    (1) Advise and assist the Chair on major acquisition policy matters;
    (2) Review and evaluate the overall effectiveness of existing 
policies and procedures and the impact of new acquisition policies, 
procedures, and regulations on current acquisition policies and 
procedures.
    (d) The Chair will periodically issue a list of current members and 
alternates, including each person's name, title, organization, address, 
telephone number, and e-mail address. ECA members are responsible for 
apprising the Chair of any changes to the list.

[71 FR 76488, Dec. 20, 2006]



                  Subpart 301.4_Deviations From the FAR



301.403  Individual deviations.

    Requests for individual deviations to either the FAR or HHSAR shall 
be prepared in accordance with 301.470 and forwarded to the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP).

[71 FR 76489, Dec. 20, 2006]



301.404  Class deviations.

    Requests for class deviations to either the FAR or HHSAR shall be 
prepared in accordance with 301.470 and forwarded to the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP).

[71 FR 76489, Dec. 20, 2006]



301.470  Procedure.

    (a) Deviation requests shall be prepared in memorandum form and 
forwarded through the Head of the Contracting Activity (HCA) to the 
Director, Division of Acquisition Policy. A deviation may be requested 
verbally in an exigency situation; however, the request must be 
confirmed 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 citation from which the 
deviation is needed;
    (3) Circumstances under which the deviation would be used;
    (4) Intended effect of the deviation;
    (5) Period or applicability;

[[Page 7]]

    (6) Reasons which will contribute to complete understanding and 
support of the requested deviation. A copy of pertinent background 
papers such as a contractor's request should accompany the deviation 
request.; and
    (7) Suggested wording for the deviation (if applicable).

[66 FR 4220, Jan. 17, 2001, as amended at 71 FR 76489, Dec. 20, 2006]



      Subpart 301.6_Career Development, Contracting Authority, and 
                            Responsibilities



301.602  Contracting officers.



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 is the official authorized to ratify an unauthorized 
commitment (but see paragraph (b)(3) of this section).
    (3) Ratification authority for actions up to $100,000 may be 
redelegated by the HCA to the chief of the contracting office (CCO). No 
other redelegations are authorized.
    (c) Limitations. (5) The concurrence of legal counsel concerning the 
payment issue is optional.
    (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, a description of the requirement, 
the estimated or agreed upon price, the funds citation, an explanation 
of why the contracting office was not used and why the proposed 
contractor was selected, a list of other sources considered, and a 
statement as to whether the contractor has commenced work.
    (2) The Contracting Officer will review the submitted material and 
prepare it for ratification if it is determined that the commitment is 
ratifiable. The Contracting Officer shall forward the ratification 
document and the submitted material to the HCA or CCO with any comments 
or information which should be considered in evaluation of the request 
for ratification. If legal review is desirable, the HCA or CCO 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 CCO, the file will 
be returned, along with the ratification document, to the contracting 
officer for issuance of a purchase order or contract, as appropriate.

[66 FR 4220, Jan. 17, 2001, as amended at 71 FR 76489, Dec. 20, 2006]



301.603  Selection, appointment, and termination of appointment of Contracting Officers/Contract Specialists.



301.603-1  General.

    (a) The appointment, selection, and termination of appointment of 
Contracting Officers/Contract Specialists shall be made by the HCA. This 
authority is not delegable. The procedures for the selection and 
appointment of Contracting Officers/Contract Specialists shall apply to 
anyone seeking a Contracting Officer warrant. OPDIV procedures shall be 
followed in the appointment and termination of Contracting Officers/
Contract Specialists in offices that have Contracting Officers/Contract 
Specialists with dual signature warrants.
    (b) Standard Form (SF) 1402, ``Certificate of Appointment,'' shall 
be used to appoint personnel in the 1102 series as Contracting Officers. 
It shall also be used for personnel in any other series who will 
obligate the Government to the expenditure of funds in excess of the 
micro-purchase threshold. The SF 1402 shall indicate the Contracting 
Officer's warrant level and threshold and any other limitations. The HCA 
may

[[Page 8]]

determine an alternate appointment document for appointments at or below 
the micropurchase threshold level. Contracting Officer warrants will be 
issued to civil service personnel only. A delegation of procurement 
authority shall be set forth in a memorandum that describes the spending 
limits and authority. Changes to appointments shall be made by issuing a 
new appointment document. Each appointment document shall be prepared 
and maintained in accordance with FAR 1.603-1 and shall state the limits 
of the individual's authority.
    (c) An individual must be certified at the appropriate level as a 
prerequisite to being appointed as a Contracting Officer with authority 
to obligate funds in excess of the micro-purchase threshold (see 
301.603-72). The HCA will determine and require training for individuals 
appointed as Contracting Officers/Contract Specialists at dollar levels 
below the micropurchase threshold. Individuals selected for Contracting 
Officer warrant authority must meet the education, training, and 
experience requirements that are established for the warrant level. An 
individual shall be appointed as a Contracting Officer only in instances 
where a valid organizational need is demonstrated. Factors to be 
considered in assessing the need for an appointment of a Contracting 
Officer include volume of actions, complexity of work, and structure of 
the organization.
    (d) Contracting Officers (GS-1102's) shall not sign contracts or 
modifications to contracts which will result in the total amount of the 
contract exceeding their delegated warrant authority (as specified on 
the SF-1402). This includes Indefinite Delivery Indefinite Quantity 
(IDIQ) contracts. However, orders placed against an IDIQ may be issued 
by Contracting Officers up to their delegated authority provided that 
each order is separate and distinct.
    (e) Employees delegated warrant authority are the only individuals 
legally authorized to bind the Government by executing contracts or 
signing determinations and findings required by the FAR. The amount 
specified on the warrant shall cover the estimated maximum contract 
amount, including all option periods. For example, an employee with a 
$500,000 Contracting Officer Certificate of Appointment may not award a 
contract for a base year of $300,000 if the contract includes a one-year 
option for an additional $300,000. In this case, the total contract 
amount, including options, exceeds the amount stipulated in the warrant. 
If a warrant is limited to $500,000 (for example), the holder may not 
sign a contract for more than that amount, even if the additional amount 
is subject to the availability of funds. Contracting Officers with 
higher warrant levels may sign the action when modifications to orders 
and contracts make the total amount of the contract exceed the 
Contracting Officer's warrant limitation.

[71 FR 76489, Dec. 20, 2006]



301.603-2  Selection of Contracting Officers.

    When it has been determined that the appointment is in the best 
interest of the OPDIV and/or Department and there is a demonstrated need 
for the procurement authority requested, nominations for appointment of 
Contracting Officers shall be submitted to the HCA through appropriate 
organizational channels for review. The HCA is responsible for 
appointing Contracting Officers in accordance with FAR 1.603. This 
authority is not delegable. The HCA will determine the documentation 
required, consistent with FAR 1.603-2, when the resulting appointment 
and authority will not exceed the micropurchase threshold.

[71 FR 76490, Dec. 20, 2006]



301.603-3  Appointment of Contracting Officers.

    (a) Appointing officials must ensure that a warrant candidate meets 
the experience and education/training requirements listed in 301.603-72.
    (b) If it is essential to appoint an individual who does not fully 
meet the certification requirements for the Contracting Officer 
authority sought, an interim appointment may be granted by the HCA. HCAs 
are responsible for ensuring that training requirements are met within 
the specified time frame. Interim appointments may not

[[Page 9]]

exceed one year in total, and shall not be granted unless the individual 
can meet the certification requirements within one year from the date of 
appointment. The HCA may extend an interim appointment by granting 
additional time to complete the requirements of a permanent appointment. 
If the certification requirements are not completed by the extended 
date, the appointment will automatically terminate.

[71 FR 76490, Dec. 20, 2006]



301.603-4  Termination or revocation of a Contracting Officer's appointment.

    Termination or revocation of Contracting Officer appointments shall 
be accomplished in accordance with FAR 1.603-4.

[71 FR 76490, Dec. 20, 2006]



301.603-70  Delegation of Contracting Officer responsibilities.

    (a) Contracting Officer responsibilities which do not involve the 
obligation or deobligation of funds or result in establishing or 
modifying contractual provisions may be delegated by the Contracting 
Officer by means of a written memorandum that clearly delineates the 
delegation and its limits.
    (b) Contracting Officers may designate individuals as ordering 
officials to make purchases or place orders under blanket purchase 
agreements, indefinite delivery contracts, or other preestablished 
mechanisms. Ordering officials, including those under the National 
Institutes of Health's (NIH) Delegated Acquisition Program (DELPRO), are 
not Contracting Officers.

[71 FR 76490, Dec. 20, 2006]



301.603-71  Waivers to warrant standards.

    There may be an unusual circumstance that requires delegation of a 
warrant to an employee who does not meet the warrant standards in of the 
HHS Contracting Officer Warrant Program. Any requests for waivers 
requesting deviations from the requirements and policies of the HHS 
Contracting Officer Warrant Program shall be sent in writing to the SPE 
for approval. The SPE will either approve or disapprove in writing the 
request for a waiver to the warrant standards. The SPE may grant waivers 
on a case-by-case basis in unique situations only.

[71 FR 76490, Dec. 20, 2006]



301.603-72  Training and certification requirements for Contracting Officers/Contract Specialists.

    (a) Federal Acquisition Certification in Contracting (FAC-C) 
certification is not mandatory for all GS-1102s; however, members of the 
workforce issued new Contracting Officer (CO) warrants on or after 
January 1, 2007, regardless of GS series, must be certified at an 
appropriate level to support their warrant obligations, pursuant to 
agency policy. New CO warrants are defined in OFPP Policy Letter 05-01 
as warrants issued to employees for the first time at a department or 
agency. FAC-C certification does not apply to:
    (1) Senior level officials responsible for delegating procurement 
authority;
    (2) Non-1102s whose warrants are generally used to procure emergency 
goods and services; or
    (3) Non-1102s whose warrants are so limited as to be outside the 
scope of this program, as determined by the Chief Acquisition Officer 
(CAO).
    (b) HHS requires a senior level FAC-C certification for any employee 
issued an unlimited Contracting Officer's warrant on or after January 1, 
2007.
    (c) Achievement of the FAC-C is based on three requirements: 
education, training, and experience, and the requirements are 
cumulative, (i.e., a person must meet the requirements of each previous 
certification level).
    (d) FAC-C training requirements are as follows:
    (1) FAC-C Level I:
    (i) CON 100 Shaping Smart Business Arrangements.
    (ii) CON 110 Mission Support Planning.
    (iii) CON 111 Mission Strategy Execution.
    (iv) CON 112 Mission Performance Assessment.
    (v) CON 120 Mission Focused Contracting.
    (vi) 1 Elective.
    (2) FAC-C Level II:
    (i) CON 202 Intermediate Contracting.

[[Page 10]]

    (ii) CON 204 Intermediate Contract Pricing.
    (iii) CON 210 Government Contract Law.
    (iv) 2 Electives.
    (3) FAC-C Level III:
    (i) CON 353 Advanced Business Solutions for Mission Support.
    (ii) 2 Electives.
    (e) Those conducting simplified acquisitions from $2,500 to $100,000 
will need to be issued an HHS Simplified Acquisition Certificate. 
Required training is as follows:
    (1) HHS Simplified Acquisition Certificate A:
    (ii) Basic Simplified Acquisition Procedures/DAU's CON 237.
    (iii) Advanced Simplified Acquisition Procedures or Appropriations 
Law.
    (2) HHS Simplified Acquisition Certificate B:
    (i) Basic Simplified Acquisition Procedures/DAU's CON 237.
    (ii) Advanced Simplified Acquisition Procedures or Appropriations 
Law.
    (iii) CON 100 (Shaping Smart Business Arrangements).
    (iv) CON 110 (Mission Support Planning).
    (f) For additional information, see http://www.knownet.hhs.gov/
acquisition/careerhandbookver.1.0.doc.

[71 FR 76490, Dec. 20, 2006]



301.603-73  Earned value training requirement for Contracting Officers/Contract Specialists who administer an IT contract.

    All GS-1102s who administer an IT contract, regardless of dollar 
threshold, are required to successfully complete the Department's 
(offered through HHS University) one-day course entitled ``Early Warning 
Project Management Systems Workshop,'' or an equivalent Earned Value 
training course. Determination of course equivalency shall be made 
jointly by the Office of Acquisition Management and Policy/ASAM and the 
HHS Office of the Chief Information Officer.

[71 FR 76490, Dec. 20, 2006]



301.603-74  Training policy exception.

    In the event there is an urgent requirement for a Contracting 
Officer/Contract Specialist to award or administer an IT contract, and 
the Earned Value training requirement has not been met, the HCA (not 
delegable) may waive the training requirement and authorize the 
individual to perform the job duties, provided that the individual 
attends the next scheduled ``Early Warning Project Management System 
Workshop'' course, or an equivalent Earned Value course.

[71 FR 76490, Dec. 20, 2006]



301.603-75  Training requirement for purchase cardholders, Approving Officials (AOs), and Agency/Organization Program Coordinators (A/OPCs).

    Training requirements for purchase cardholders, AOs, and A/OPCs are 
listed in the following table:

------------------------------------------------------------------------
                                    Program
        Authority \a\             participant      Required training \b\
------------------------------------------------------------------------
Up to $2,500.................  Prospective/newly  Basic purchase card
                                appointed          course (HHS
                                purchase           University 1-day
                                cardholders and    course) or an
                                Approving          equivalent course
                                Officials.         that has been
                                                   approved by the HHS
                                                   Acquisition Training
                                                   Coordinator prior to
                                                   appointment. Training
                                                   will include green-
                                                   purchasing and
                                                   Section 508
                                                   requirements.
                               Purchase card      Refresher purchase
                                holders and        card training,
                                Approving          including green-
                                Officials.         purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years.
$2,501 to $25,000............  Prospective/newly  
                                appointed          Basic Purchase Card
                                purchase           course.
                                cardholders and   
                                Approving          Basic Simplified
                                Officials.         Acquisition
                                                   Procedures/DAU's CON
                                                   237.
                                                  
                                                   Advanced Simplified
                                                   Acquisition
                                                   Procedures or
                                                   Appropriations Law.
                               Purchase card      Refresher purchase
                                holders and        card training,
                                Approving          including green-
                                Officials.         purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years.
$25,001 to $100,000..........  Prospective/newly  
                                appointed          Basic Purchase Card
                                purchase           course.
                                cardholders and   
                                Approving          Basic Simplified
                                Officials.         Acquisition
                                                   Procedures/DAU's CON
                                                   237.
                                                  
                                                   Advanced Simplified
                                                   Acquisition
                                                   Procedures or
                                                   Appropriations Law.
                                                   CON
                                                   100 (Shaping Smart
                                                   Business
                                                   Arrangements).
                                                   CON
                                                   110 (Mission Support
                                                   Planning).

[[Page 11]]

 
                               Purchase           Refresher purchase
                                cardholders and    card training,
                                Approving          including green-
                                Officials.         purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years.
Not applicable...............  Prospective/newly  Basic Purchase Card
                                appointed Agency/  course, Basic
                                Organization       Simplified
                                Program            Acquisition
                                Coordinators.      Procedures or DAU's
                                                   CON 237, Advanced
                                                   Simplified
                                                   Acquisition
                                                   Procedures or
                                                   Appropriations Law,
                                                   CON 100 (Shaping
                                                   Smart Business
                                                   Arrangements), and
                                                   CON 110 (Mission
                                                   Support Planning).
                               Agency/            Refresher purchase
                                Organization       card training,
                                Program            including green-
                                Coordinators.      purchasing training
                                                   and Section 508
                                                   training, every 2
                                                   years (attendance at
                                                   GSA's annual training
                                                   conference satisfies
                                                   refresher training).
------------------------------------------------------------------------
\a\ Cardholders and Approving Officials with authorized increases in DPA
  have up to 6 months to complete the training requirements for the new
  DPA.
\b\ CON 237, CON 100, and CON 110 are available at the DAU Web site at
  http://www.dau.mil/registrar/enroll.asp. CON 100 is also offered
  through HHS University (see Web site at: http://learning.hhs.gov).


[71 FR 76490, Dec. 20, 2006]



301.603-76  Requirement for certification retention and maintaining currency of acquisition knowledge and skills for Contracting Officers/Contract Specialists 
          and purchasing agents.

    To maintain a FAC-C, GS-1102s, including all warranted Contracting 
Officers regardless of series, shall earn 80 continuous learning points 
(CLPs) every two years beginning January 1, 2008. For GS-1105s and GS-
1106s, a minimum of forty (40) hours (or continuous learning points) is 
required every two years after all mandatory training requirements have 
been met. Certification will expire if the CLPs are not earned every two 
years, and may result in a loss of warrant authority.

[71 FR 76490, Dec. 20, 2006]



PART 302_DEFINITIONS OF WORDS AND TERMS--Table of Contents




                        Subpart 302.1_Definitions

Sec.
302.101 Definitions.

                    Subpart 302.2_Definitions Clause

302.201 Contract clause.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4222, Jan. 17, 2001, unless otherwise noted.



                        Subpart 302.1_Definitions



302.101  Definitions.

    Agency head or head of the Agency, unless otherwise specified, means 
the head of the Operating Division (OPDIV) for Agency for Healthcare 
Research and Quality (AHRQ), Centers for Disease Control and Prevention 
(CDC), Centers for Medicare & Medicaid Services (CMS), Food and Drug 
Administration (FDA), Health Resources and Services Administration 
(HRSA), Indian Health Service (IHS), National Institutes of Health 
(NIH), Substance Abuse and Mental Health Services (SAMHSA), and the 
Deputy Secretary for the Office of the Secretary (OS).
    Chief of the Contracting Office (CCO) is typically a mid-level 
management official, usually an office director, division director, or 
branch chief, who manages and monitors the daily contract operations of 
an OPDIV or major component of an OPDIV. The CCO is subordinate to the 
Head of Contracting Activity (HCA), except where the HCA and CCO are the 
same individual.
    Head of the contracting activity (HCA)--
    (1) Occupies designated organization positions as follows:

ASAM-OS--Deputy Assistant Secretary for Acquisition Management and 
    Policy
AHRQ--Director, Division of Contracts Management
CMS--Director, Office of Acquisition and Grants Management
PSC--Director, Division of Acquisition Management
CDC--Director, Procurement and Grants Office
FDA--Director, Office of Acquisitions & Grant Services
HRSA--Director, Division of Procurement Management
IHS--Director, Division of Acquisition Policy

[[Page 12]]

NIH--Director, Office of Acquisition Management and Policy
SAMHSA--Director, Division of Contracts Management

    (2) Each 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 and evaluated 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.
    (3) 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 absence of coverage in the HHS 
Acquisition Regulation, the Federal Acquisition Regulation. To ensure 
proper control of redelegated acquisition authorities, HCAs shall 
maintain a file containing successive delegations of HCA authority 
through and including the Contracting Officer level. 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.
    Project Officer is a Federal employee who monitors contractor 
performance and provides technical guidance to the Contract Specialist/
Contracting Officer. The Project Officer serves as the Contract 
Specialist/Contracting Officer's authorized representative to monitor 
specific aspects of the contract, thereby ensuring that the contractor's 
performance meets the standards set forth in the contract, the technical 
requirements under the contract are met by the delivery date(s) and/or 
within the period of performance, and performance is accomplished within 
the price or estimated cost stated in the contract. A Project Officer is 
required to comply with HHS Project Management Certification Program 
training requirements. The term ``Project Officer'' is synonymous with 
Contracting Officer's Representative (COR) and Contracting Officer's 
Technical Representative (COTR).

[71 FR 76491, Dec. 20, 2006]



                    Subpart 302.2_Definitions Clause



302.201  Contract clause.

    The FAR clause, Definitions, at 52.202-1 shall be used as prescribed 
in FAR 2.201, except as follows:
    (a) In accordance with 52.202-1(a)(1), paragraph (a) at 352.202-1 
shall be used in place of paragraph (a) of the FAR clause.
    (b) In accordance with 52.202-1(a)(1), paragraph (h), or its 
alternate, at 352.202-1 shall be added to the end of the FAR clause. Use 
paragraph (h) when a fixed-priced contract is anticipated; use the 
alternate to paragraph (h) when a cost-reimbursement contract is 
anticipated. This is an authorized deviation.

[71 FR 76492, Dec. 20, 2006]



PART 303_IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents




                        Subpart 303.1_Safeguards

Sec.
303.101 Standards of conduct.
303.101-3 Agency regulations.
303.104-7 Violations or possible violations of the Procurement Integrity 
          Act.

        Subpart 303.2_Contract Gratuities to Government Personnel

303.203 Reporting suspected violations of the Gratuities clause.

         Subpart 303.3_Reports of Suspected Antitrust Violations

303.303 Reporting suspected antitrust violations.

[[Page 13]]

                      Subpart 303.4_Contingent Fees

303.405 Misrepresentations or violations of the Covenant Against 
          Contingent Fees.

Subpart 303.6_Contracts With Government Employees or Organizations Owned 
                          or Controlled by Them

303.602 Exceptions.

             Subpart 303.7_Voiding and Rescinding Contracts

303.704 Policy.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4223, Jan. 17, 2001, unless otherwise noted.



                        Subpart 303.1_Safeguards



303.101  Standards of conduct.



303.101-3  Agency regulations.

    (a)(3) The Department of Health and Human Services' Standards of 
Conduct are prescribed in 45 CFR part 73.

[71 FR 76492, Dec. 20, 2006]



303.104-7  Violations or possible violations of the Procurement Integrity Act.

    (a)(1) The contracting officer's determination that a reported 
violation or possible violation of the statutory prohibitions has no 
impact on the impending award or selection of a contractor must be 
submitted through appropriate channels, along with supporting 
documentation, to the Head of Contracting Activity (HCA) for review and 
approval of the determination awarding 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 contractor must be 
referred through channels, along with all related information available, 
to the HCA (if the HCA is an SES) or to another SES official designated 
by the OpDiv. That individual will--
    (i) Refer the matter immediately to the Deputy Assistant Secretary 
for Acquisition Management and Policy (DASAMP), Assistant Secretary for 
Administration and Management, Office of the Secretary, for review, 
which may consult with the Office of General Counsel (OGC) and the 
Office of Inspector General (OIG), as appropriate; and
    (ii) Determine the action to be taken on the procurement in 
accordance with FAR 3.104-7(c) and (d). The HCA shall obtain the 
approval or concurrence of the OAMP before proceeding with the action.
    (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 
52.203-10, Price or Fee Adjustment for Illegal or Improper Authority.

[70 FR 39, Jan. 3, 2005, as amended at 71 FR 76492, Dec. 20, 2006]



       Subpart 303.2_Contractor Gratuities to Government Personnel



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 
45 CFR part 73. Refer to subpart B, Gifts from Outside Sources, (5 CFR 
2635.201) for an explanation regarding what is prohibited and what is 
permitted.



         Subpart 303.3_Reports of Suspected Antitrust Violations



303.303  Reporting suspected antitrust violations.

    (h) A copy of the agency report of suspected antitrust violations 
submitted to the Attorney General by the HCA shall also be submitted to 
the Director, Office of Acquisition Management and Policy.

[71 FR 76492, Dec. 20, 2006]



                      Subpart 303.4_Contingent Fees



303.405  Misrepresentations or violations of the Covenant Against Contingent Fees.

    (a) Reports shall be made promptly to the Contracting Officer.
    (b)(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

[[Page 14]]

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 Management and Policy.

[71 FR 76492, Dec. 20, 2006]



Subpart 303.6_Contracts With Government Employees or Organizations Owned 
                          or Controlled by Them



303.602  Exceptions.

    Approval of an exception to the policy stated in FAR 3.601 shall be 
made by the HCA (not delegable).



             Subpart 303.7_Voiding and Rescinding Contracts



303.704  Policy.

    (a) For purposes of implementing FAR subpart 3.7, the authorities 
granted to the ``agency head or designee'' shall be exercised by the HCA 
(not delegable).

[71 FR 76492, Dec. 20, 2006]



PART 304_ADMINISTRATIVE MATTERS--Table of Contents




                    Subpart 304.6_Contract Reporting

Sec.
304.602 Federal Procurement Data System--Next Generation (FPDS-NG).

                 Subpart 304.8_Government Contract Files

304.804-70 Contract closeout audits.

  Subpart 304.70_Acquisition Instrument Identification Numbering System

304.7000 Scope of subpart.
304.7001 Numbering acquisitions.

     Subpart 304.71_Review and Approval of Proposed Contract Awards

304.7100 Policy.
304.7101 Procedures.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4224, Jan. 17, 2001, unless otherwise noted.



                   Subpart 304.6_Contracting Reporting



304.602  Federal Procurement Data System--Next Generation (FPDS-NG).

    The Departmental Contracts Information System (DCIS) represents the 
Department's implementation of the FPDS-NG. All departmental contracting 
activities are required to use the DCIS and follow the procedures stated 
in the Enhanced Departmental Contracts Information System Manual, 
available at http://dcis.hhs.gov, and amendments to the manual. The HCA 
(not delegable) 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 contracts and contract modifications awarded in 
the previous month.

[71 FR 76492, Dec. 20, 2006]



                 Subpart 304.8_Government Contract Files



304.804-70  Contract closeout audits.

    (a) Contracting Officers shall rely, to the maximum extent possible, 
on single audits to close physically completed cost-reimbursement 
contracts with colleges and universities, hospitals, non-profit firms, 
and State and local governments. In addition, where appropriate, a 
sample of these contractors may be selected for audit, in accordance 
with paragraph (b) of this section.
    (b) Contracting officers shall request contract closeout audits on 
physically completed, cost-reimbursement, for-profit contracts in 
accordance with the following:
    (1) The Office of the Inspector General (OIG) and ASAM's Deputy 
Assistant Secretary for Acquisition Management and Policy in conjunction 
with the OPDIV's cost advisory/audit focal point, determine which 
contracts or contractors will be audited, which audit agency will 
perform the audit, and the type and scope of closeout audit to be 
performed. These decisions shall be based upon the needs of the 
customer, risk analysis, return on investment, and the availability of 
audit

[[Page 15]]

resources. When an audit is warranted prior to closing a contract, the 
Contracting Officer shall submit the audit request to the OIG's Office 
of Audit, via the OPDIV's cost advisory/audit focal point.
    (2) Except where a contracting officer suspects misrepresentation or 
fraud, contract closeout field audits shall not be requested if the cost 
of performance is likely to exceed the potential cost recovery. 
Contracts that are not selected for a field audit may be closed on the 
basis of a desk review, subject to any later on-site audit findings. The 
release executed by the contractor shall contain the following 
statement:

    The Contractor agrees, pursuant to the clause in this contract 
entitled ``Allowable Cost'' or ``Allowable Cost and Fixed Fee'' (as 
appropriate), that the amount of any sustained audit exceptions 
resulting from any audit made after final payment shall be refunded to 
the Government.''

[66 FR 4224, Jan. 17, 2001, as amended at 71 FR 76493, Dec. 20, 2006]



  Subpart 304.70_Acquisition Instrument Identification Numbering System



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. The HCA 
(not delegable) is responsible for establishing the numbering system 
within the OPDIV.



304.7001  Numbering acquisitions.

    (a) Acquisitions which require numbering. The following acquisitions 
shall be numbered in accordance with the system prescribed in paragraphs 
(b), (c), and (d) of this section:
    (1) 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. (The 
number assigned to a letter contract shall be assigned to the 
superseding definitized contract).
    (2) Contracts which involve the payment of $2,000 or more for 
construction (including renovation or alteration).
    (3) Contracts which involve more than one payment regardless of 
amount.
    (4) Requests for proposals and invitations for bids.
    (5) Requests for quotations.
    (6) Basic ordering agreements.
    (b) Numbering system for contracts. All contracts which require 
numbering (paragraphs (a)(1) through (3) of this section) shall be 
assigned a number consisting of the following:
    (1) The three digit identification code of the Department (HHS);
    (2) A one digit alphabetic identification code of the servicing 
agency:

O Office of the Secretary
P Program Support Center
M Centers for Medicare & Medicaid Services
F Food and Drug Administration
D Centers for Disease Control and Prevention
I Indian Health Service
S Substance Abuse and Mental Health Administration
N National Institutes of Health
H Health Resources and Services Administration
A Agency for Health Care Research & Quality

    (3) The three digit numeric identification code assigned by the 
Deputy Assistant Secretary for Acquisition Management and Policy 
(DASAMP) to the contracting office within the servicing agency;
    (4) A four digit fiscal year designation (e.g., 2005, 2006);
    (5) A five digit alphanumeric tracking number the content of which 
is determined by the contracting office within the servicing agency; and
    (6) A one digit code describing the type of contract action:

A Commercial Item Acquisition
C New Definitive Contract
P Purchase Using Simplified Acquisition
I Indefinite Delivery Contract (IDIQ)
O Basic Ordering Agreement (BOA)
B Blanket Purchase Agreement (BPA)
F Facilities Contract
U Contracts placed with or through other Government departments, GSA 
contracts, or against mandatory source contracts such as the National 
Industries for the Blind (NIB), the National Industries for the Severely 
Handicapped (NISH), and the Federal Prison Industries (UNICOR)
L Lease Agreement
W Government-wide Acquisition Contract (GWAC)

[[Page 16]]

E Letter Contract
G Federal Supply Schedule
M Micropurchase

    For example, the first contract for NIH, National Cancer Institute, 
for fiscal year 2005 may be numbered HHSN261200500001C.
    (c) Numbering system for orders. Order numbers will be assigned to 
contracts with orders. The order number shall be up to a seventeen digit 
number consisting of the following:
    (1) The three digit identification code of the Department (HHS);
    (2) A one digit numeric identification code of the servicing agency:

O Office of the Secretary
P Program Support Center
M Centers for Medicare & Medicaid Services
F Food and Drug Administration
D Centers for Disease Control and Prevention
I Indian Health Service
S Substance Abuse and Mental Health Administration
N National Institutes of Health
H Health Resources and Services Administration
A Agency for Health Care Research and Quality;

    (3) The three digit numeric identification code assigned by the 
Office of Acquisition Management and Policy (OAMP) to the contracting 
office within the servicing agency;
    (4) An alphanumeric tracking number, up to ten characters, the 
content of which is determined by the contracting office within the 
servicing agency.
    (d) Numbering system for other acquisitions. The HCA is responsible 
for developing a numbering system for the acquisitions other than 
contracts listed in paragraphs, (a)(4) through (a)(6) of this section, 
and any other types of acquisitions that may be used.
    (e) Assignment of identification codes. Each contracting office of 
the Department shall be assigned a three digit identification code by 
the ASAM/OAMP. Requests for the assignment of codes for newly 
established contracting offices shall be submitted by a headquarters 
official from the new contracting office to the OAMP. A listing of the 
contracting office identification codes currently in use is contained in 
the Enhanced Departmental Contracts Information System Manual, available 
at http://dcis.hhs.gov.

[66 FR 4224, Jan. 17, 2001, as amended at 70 FR 39, Jan. 3, 2005; 70 FR 
11583, Mar. 9, 2005; 71 FR 76493, Dec. 20, 2006]



     Subpart 304.71_Review and Approval of Proposed Contract Awards



304.7100  Policy.

    This subpart requires each HCA (not delegable) to establish review 
and approval procedures for proposed contracts 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.



304.7101  Procedures.

    (a) All contractual documents, regardless of dollar value, are to be 
reviewed by the contracting officer prior to award.
    (b) The HCA is responsible for establishing review and approval 
procedures and designating acquisition officials to serve as reviewers. 
Each HCA is responsible for determining the criterion (criteria) to be 
used in determining which contracts are to be reviewed, and that a 
sampling of proposed contracts not included in the ``to be reviewed'' 
group are reviewed and approved.
    (c) 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, at a minimum, 
possess those acquisition skills expected of a contracting officer. 
However, if any official is 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.

[[Page 17]]



            SUBCHAPTER B_COMPETITION AND ACQUISITION PLANNING





PART 305_PUBLICIZING CONTRACT ACTIONS--Table of Contents




           Subpart 305.2_Synopsis of Proposed Contract Actions

Sec.
305.202 Exceptions.

                Subpart 305.3_Synopsis of Contract Awards

305.303 Announcement of contract awards.

                    Subpart 305.5_Paid Advertisements

305.502 Authority.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4225, Jan. 17, 2001, unless otherwise noted.



           Subpart 305.2_Synopsis of Proposed Contract Actions



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 Deputy Assistant Secretary for 
Acquisition Management and Policy (DASAMP) requesting relief from 
synopsizing. The DASAMP shall review the request and decide whether an 
exception to synopsizing is appropriate or reasonable. If it is, the 
DASAMP shall take the necessary coordinating actions required by FAR 
5.202(b). Whatever the decision is on the request, the DSAMP shall 
promptly notify the contracting office when a determination has been 
made.

[71 FR 76493, Dec. 20, 2006]



                Subpart 305.3_Synopses of Contract Awards



305.303  Announcement of contract awards.

    (a) Public announcement. Awards over $3.5 million, not otherwise 
exempt under FAR 5.303, shall be reported by the Contracting Officer to 
the Office of the 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. Notification may also be 
accomplished by e-mailing a copy of the contract or award document face 
page to grantfax@hhs.gov, or faxing to (202) 205-2420.

[71 FR 76493, Dec. 20, 2006]



                    Subpart 305.5_Paid Advertisements



305.502  Authority.

    The Contracting Officer may advertise or place notices in newspapers 
and periodicals to announce that proposals are being sought.

[71 FR 76493, Dec. 20, 2006]



PART 306_COMPETITION REQUIREMENTS--Table of Contents




   Subpart 306.2_Full and Open Competition After Exclusion of Sources

Sec.
306.202 Establishing or maintaining alternative sources.

           Subpart 306.3_Other Than Full and Open Competition

306.302 Circumstances permitting other than full and open competition.
306.302-1 Only one responsible source and no other supplies or services 
          will satisfy agency requirements.
306.302-7 Public interest.
306.303 Justification.
306.303-1 Requirements
306.303-2 Content.
306.304 Approval of the justification.

                   Subpart 306.5_Competition Advocates

306.501 Requirement.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

[[Page 18]]


    Source: 66 FR 4225, Jan. 17, 2001, unless otherwise noted.



   Subpart 306.2_Full and Open Competition After Exclusion of Sources



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 is not delegable.



           Subpart 306.3_Other Than Full and Open Competition



306.302  Circumstances permitting other than full and open competition.



306.302-1  Only one responsible source and no other supplies or services will satisfy agency requirements.

    (a)(2)(iv) Follow-on contracts for the continuation of major 
research and development studies on long-term social and health 
programs, major research studies, or clinical trials 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. (5) When the head of the program office has 
determined that only specified makes and models of technical equipment 
or parts must be obtained to meet the 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.)

[71 FR 76493, Dec. 20, 2006]



306.302-7  Public interest.

    (a) Authority. (2) Agency head, in this instance, means the 
Secretary.
    (c) Limitations. An ``approval package'' must be prepared by the 
contracting officer and staffed through departmental acquisition 
channels to the Secretary. The package shall include a determination and 
findings for the Secretary to sign that contains all pertinent 
information to support justification for exercising the exemption to 
competition, and 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).



306.303  Justifications.



306.303-1  Requirements.

    (a)(1) The Program Office must provide a written justification 
whenever it requests that certain goods or services be obtained without 
full and open competition. The justification must explain why full and 
open competition is not feasible and must be submitted with the 
requisition or request for contract.
    (i) Justifications in excess of the simplified acquisition threshold 
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 
at or below the simplified acquisition threshold may be in the form of a 
paragraph or paragraphs contained in the requisition or request for 
contract.
    (ii) Justifications, whether over or under the simplified 
acquisition threshold, 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 
justification should be sufficient to permit an individual with 
technical competence in the area to follow the rationale.
    (iii) Sole source justifications using the Federal Supply Schedule 
shall include the content listed in FAR 6.303-2.

[[Page 19]]

    (b) Preliminary arrangements or agreements with the proposed 
contractor shall have no effect on the rationale used to support an 
acquisition for other than full and open competition.

[71 FR 76493, Dec. 20, 2006]



306.303-2   Content.

    (a)(1) Each justification shall include the name of the program 
office; the name, address, and phone number of the Project Officer; and 
project identification, such as the authorizing program legislation, to 
include citations or other internal program identification data such as 
title, contract number, etc.
    (2) The description 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) JOFOCs shall be signed by the Project Officer, the Project 
Officer's immediate supervisor, the Contracting Officer, and the 
approving official (if the approving official is not the Contracting 
Officer).

[71 FR 76494, Dec. 20, 2006]



306.304  Approval of the justification.

    (a)(2) The competition advocates are listed in 306.501. This 
authority is not delegable.
    (3) The competition advocate shall exercise this approval authority, 
except where the individual designated as the competition advocate does 
not meet the requirements of FAR 6.304 (a)(3)(ii). This authority is not 
delegable.
    (4) The senior procurement executive of the Department is the Deputy 
Assistant Secretary for Acquisition Management and Policy. This 
designation has been made pursuant to the OFPP Act (41 U.S.C. 
414(c)(2)(B).
    (c) A class justification shall be processed the same as an 
individual justification.

[71 FR 76494, Dec. 20, 2006]



                   Subpart 306.5_Competition Advocates



306.501  Requirement.

    The Department's competition advocate is the Director, Strategic 
Acquisition Service, Program Support Center (PSC). The competition 
advocates for each of the Department's contracting activities are as 
follows:

AHRQ--Director, Office of Performance Accountability, Resources and 
Technology
CDC--Chief Information Officer
CMS--Chief Operating Officer
FDA--Chief, Office of Shared Services
HRSA--Associate Administrator, Office of Administration and Financial 
Management
IHS--Director, Office of Management Services
NIH--Senior Scientific Advisor for Extramural Research, Office of 
Extramural Research (R&D) and Senior Advisor to the Director (Other than 
R&D)
PSC--Director, Strategic Acquisition Service
SAMHSA--Executive Officer

[71 FR 76494, Dec. 20, 2006]



PART 307_ACQUISITION PLANNING--Table of Contents




                   Subpart 307.1_Acquisition Planning

Sec.
307.104 General procedures.
307.105 Contents of written acquisition plans.
307.170 Program training requirements.
307.170-1 Training policy exceptions.
307.170-2 Training course prerequisites.
307.170-3 Earned value training requirement for IT program/project 
          managers and IT CORs/COTRs.
307.170-4 Required training in HHS' portfolio management tool.
307.170-5 Maintenance/refresher training requirement for program/project 
          managers and CORs/COTRs.
307.170-6 Warranting of Other Transaction Officers for Other 
          Transactions.
307.170-7 Training requirements for Other Transaction Officers.
307.170-8 Appointment of an Other Transaction Officer Technical 
          Representative for an Other Transaction.
307.170-9 Training requirement for an Other Transaction Officer 
          Technical Representative.

     Subpart 307.70_Considerations in Selecting an Award Instrument

307.7000 Scope of subpart.

[[Page 20]]

307.7001 Distinction between acquisition and assistance.
307.7002 Procedures.

                  Subpart 307.71_Requests for Contract

307.7100 Scope of subpart.
307.7101 General.
307.7102 Procedures.
307.7103 Responsibilities.
307.7104 Transmittal.
307.7105 Format and content.
307.7106 Statement of work.
307.7107 Review.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4226, Jan. 17, 2001, unless otherwise noted.



                   Subpart 307.1_Acquisition Planning



307.104  General procedures.

    (a) Each contracting activity shall prepare an Annual Acquisition 
Plan (AAP). The AAP is a macro plan, containing a list of anticipated 
contract actions over the simplified acquisition threshold and their 
associated funding, as well as the aggregate planned dollars for 
simplified acquisitions by quarter, developed for each fiscal year. The 
AAP shall conform to reasonable budget expectations and shall be 
reviewed at least quarterly and modified as appropriate. The HCA or the 
CCO shall obtain this information from the program planning/budget 
office of the contracting activity and use the AAP to provide necessary 
reports and monitor the workload of the contracting office. For contract 
actions, the plan shall contain, at a minimum:
    (1) A brief description (descriptive title, perhaps one or two 
sentences if necessary);
    (2) Estimated award amount;
    (3) Requested award date;
    (4) Name and phone number of contact person (usually the Project 
Officer);
    (5) Other information required for OPDIV needs.
    (b) Once the AAP is obtained from the program planning/budget 
office, the Contracting Officer/Contract Specialist shall initiate 
discussions with the assigned Project Officer for each planned 
negotiated acquisition over $100,000 except for:
    (1) Acquisitions made under interagency agreements, and
    (2) Contract modifications which exercise options, make changes 
authorized by the Changes clause, or add funds to an incrementally 
funded contract. (The HCA may prescribe procedures for contract actions 
not covered by this subpart.)
    (c) The purpose of the discussions between the Contracting and 
Project Officers is to develop an individual acquisition planning 
schedule and to address areas that will need to be covered in the 
request for contract (RFC), including clearances, acquisition strategy, 
sources, etc. The Project Officer must either have a statement of work 
(SOW) ready at this time or must discuss in more detail the nature of 
the services/supplies that will be required.
    (d) Standard lead-times for processing various types of acquisitions 
and deadlines for submission of acceptable RFCs (that is, RFCs which 
include all required elements such as clearances, funding documents, and 
an acceptable SOW) for award in a given fiscal year shall be established 
by the HCA or designee not lower than the CCO.
    (e) The outcome of the discussions referenced in paragraph (c) of 
this section between the Project Officer and the Contracting Officer/
Contract Specialist will be an agreement concerning the dates of 
significant transaction-specific acquisition milestones, including the 
date of submission of the RFC to the Contracting Officer. This milestone 
schedule document will be prepared with those dates and will be signed 
by the Project Officer and the Contracting Officer. The milestones 
cannot be revised except by mutual agreement of these same individuals. 
If the planning schedule indicates the need to obtain approval of a 
Justification for Other than Full and Open Competition, the HCA or CCO 
must sign the milestone agreement. This document shall be retained in 
the contract file. All other considerations that will affect the 
acquisition (technical, business, management) shall be addressed in the 
RFC (see 307.71).

[71 FR 76494, Dec. 20, 2006]

[[Page 21]]



307.105  Contents of written acquisition plans.

    The written acquisition plan required by FAR 7.105 must be contained 
in the request for contract, as specified in subpart 307.71, and is the 
final product of the planning process.



307.170  Program training requirements.

    (a) HHS will maintain a program for certifying employees before they 
may be considered eligible for appointment as a program/project manager 
or COR/COTR.
    (b) All HHS program/project managers, alternate program/project 
managers, CORs/COTRs, alternate CORs/COTRs, and at least fifty percent 
of the HHS program personnel performing the function of technical 
proposal evaluator on a technical evaluation team or panel for a 
competitively solicited HHS contract, shall have successfully completed 
the Department's ``Basic Project Officer'' course, or an equivalent 
course, before assuming the duties of their designated role, or take the 
next available class. This requirement applies to the initial technical 
proposal evaluation and any subsequent technical evaluations that may be 
required. (*Peer and objective reviewers are excluded from these 
requirements). Course equivalency for the ``Basic Project Officer'' 
course will be determined by the ASAM/OAMP. The Contracting Officer is 
responsible for ensuring that the program/project manager, COR/COTR, and 
proposal evaluators have successfully completed the required training. 
Non-information technology (IT) program/project managers and non-IT 
CORs/COTRs who have successfully completed the appropriate ``Basic 
Project Officer'' course, or an equivalent course, are highly encouraged 
to take the Department's one-day course entitled ``Early Warning Project 
Management System Workshop,'' or an equivalent Earned Value course. 
Program/Project managers and CORs/COTRs are highly encouraged to take 
the Department's ``Writing Statements of Work'' course, or an equivalent 
course. Peer and objective reviewers are excluded from these 
requirements. (*The peer review process pertains specifically to NIH in 
the peer review of applications for grants and contracts. Applications 
are evaluated by a peer review group composed of scientists from the 
extramural research community.) All courses are offered through HHS 
University.

[71 FR 76495, Dec. 20, 2006]



307.170-1  Training policy exceptions.

    In the event there is an urgent requirement for a specific 
individual to serve as a program/project manager and COR/COTR (or 
alternate program/project manager and alternate COR/COTR) and that 
individual has not successfully completed the prerequisite training 
course(s), the HCA (not delegable) may waive the training requirement 
and authorize the individual to perform the project duties, provided 
that:
    (a) The individual first meets with the cognizant Contracting 
Officer to review the HHS ``Project Officer's Contracting Handbook'' to 
discuss the important aspects of the contracting-program office 
relationship as appropriate to the circumstances; and
    (b) The individual attends the next scheduled ``Basic Project 
Officer'' course, or an equivalent course, and, for those current and 
proposed IT program/project managers, as well as alternate IT program/
project managers and IT CORs/COTRs (as well as alternate CORs/COTRs) 
assigned to HHS IT projects (including those designated as major or 
tactical by HHS), the next ``Early Warning Project Management System 
Workshop.''

[71 FR 76495, Dec. 20, 2006]



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 22]]

    (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) Project Officers on HHS projects for which HHS or OMB requires 
an Exhibit 300 [under OMB Circular A-11, part 7] must successfully 
complete either HHS'' ``Early Warning Project Management System 
Workshop'' or an equivalent Earned Value Management course (see 
paragraph 307.170(c)).
    (4) 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 or its equivalent. Upon successful completion 
of the basic course, it is recommended that they take the appropriate 
``Advanced Project Officer'' course. Peer and objective reviewers are 
excluded from these requirements.

[66 FR 4226, Jan. 17, 2001, as amended at 70 FR 40, Jan. 3, 2005]



307.170-3  Earned value training requirement for IT program/project managers and IT CORs/COTRs.

    All current and proposed IT program/project managers, alternate IT 
program/project managers, IT CORs/COTRs, and alternate CORs/COTRs 
assigned to HHS IT projects (including those IT projects designated as 
major or tactical), regardless of dollar threshold, must successfully 
complete the Department's (offered through HHS University) one-day 
course entitled ``Early Warning Project Management System Workshop,'' or 
an equivalent Earned Value training course. Course equivalency will be 
determined jointly by the ASAM/OAMP and the HHS Office of the Chief 
Information Officer.

[71 FR 76495, Dec. 20, 2006]



307.170-4  Reqired training in HHS' portfolio management tool.

    All current and proposed IT program/project managers, as well as 
alternate IT program/project managers and IT CORs/COTRs (as well as 
alternate IT CORs/COTRs), regardless of dollar threshold, must 
successfully complete training in HHS' portfolio management tool 
(contact the HHS Office of the Chief Information Officer for additional 
information).

[71 FR 76495, Dec. 20, 2006]



307.170-5  Maintenance/refresher training requirement for program/project managers and CORs/COTRs.

    Program/Project Managers and CORs/COTRs who monitor one or more 
contracts are required to take 40 CLPs each year.

[71 FR 76495, Dec. 20, 2006]



307.170-6  Warranting of Other Transaction Officers for Other Transactions.

    (a) Other Transaction (OT) Officers shall possess the qualifications 
necessary to ensure that OTs are in compliance with applicable laws and 
regulations. The ASAM/OAMP will have the sole authority to warrant OT 
Officers at HHS. To receive a warrant as an HHS OT Officer, the 
individual must be a Contracting Officer, preferably with an unlimited 
warrant, with a Federal Acquisition Certification in Contracting (FAC-C) 
Level III, or a Level III or IV certified Grants Officer within HHS. 
Nominations for appointment of OT Officers shall be submitted to the 
Head of Contracting Activity in writing through appropriate 
organizational channels for review. The nomination package shall include 
the following:
    (1) A completed Appendix A (``OT Officer's Warrant Application 
Form'') of HHS Other Transaction Authority Guidebook;
    (2) A recommendation from the employee's immediate supervisor 
providing justification for the appointment of an HHS OT Officer;
    (3) Current resume/OF 612/SF 171 and/or other documentation 
describing the employee's experience, education, and training relevant 
to the position for which warrant authority is being sought;
    (4) A copy of the employee's most recent performance appraisal;
    (5) Type of work to be performed under the warrant, i.e., executing 
OTs;

[[Page 23]]

    (6) A copy of the certificate issued under the HHS Acquisition 
Certification Program indicating the employee's current certification 
level and a copy of previous warrant certificate, if applicable; or a 
copy of the certificate issued under the HHS Grants Certification 
Program, if applicable; and
    (7) Proof of successful completion of the ``Cooperative Agreements, 
CRADAs & Other Transactions'' course taught by Federal Publications 
Seminars, or an equivalent course.
    (b) For additional information, see http://www.knownet.hhs.gov/
acquisition/hhs--epp--postings/HHSGuidebook1-OTAMarch2005.doc.

[71 FR 76495, Dec. 20, 2006]



307.170-7  Training requirements for Other Transaction Officers.

    OT Officers must successfully complete the ``Cooperative Agreements, 
CRADAs & Other Transactions'' course, or an equivalent course, prior to 
appointment as an OT Officer. Grants Officers who serve as OT Officers 
are required to have successfully completed the following courses: CON 
110 (``Mission Support Planning''); CON 111 (``Mission Strategy 
Execution,''); CON 112 (``Mission Performance,'') or CON 120 (``Mission 
Focused Contracting.''), or equivalent courses prior to being appointed 
as an OT Officer. The HHS OTA Board will determine course equivalency.

[71 FR 76495, Dec. 20, 2006]



307.170-8  Appointment of an Other Transaction Officer Technical Representative for an Other Transaction.

    The program office nominates the Other Transaction Officer Technical 
Representative (OTR). The OT Officer prepares an OTR delegation 
memorandum that describes the OTR's authority and assigns the OTR 
specific responsibilities, with limitations of authority, in writing. 
The OTR represents the OT Officer only to the extent delegated in the 
written appointment and does not have the authority to change the terms 
and conditions of the OT.

[71 FR 76495, Dec. 20, 2006]



307.170-9  Training requirement for an Other Transaction Officer Technical Representative.

    (a) Program personnel selected to serve as an OTR or an alternate 
OTR assigned to an OT, and at least fifty percent of the technical 
evaluators that review the initial and any subsequent proposals or 
revisions thereof, shall successfully complete the Department's ``Basic 
Project Officer'' course, or an equivalent course prior to being 
appointed. Determination of course equivalency shall be made by the HHS 
OTA Board.
    (b) In addition to the Department's required ``Basic Project 
Officer'' course, the OTR or alternate OTR assigned to an OT, and at 
least fifty percent of the technical evaluators that review the initial 
and any subsequent proposals or revisions thereof, shall successfully 
complete the ``Cooperative Agreements, CRADAs & Other Transactions'' 
course, or an equivalent course, prior to being appointed and prior to 
assuming job duties associated with the OT.
    (c) Refresher training in the policies and procedures of awarding 
cooperative agreements, CRADAs and OTs is required every three years.

[71 FR 76495, Dec. 20, 2006]



     Subpart 307.70_Considerations in Selecting an Award Instrument



307.7000  Scope of subpart.

    This subpart provides guidance on the appropriate selection of award 
instruments consistent with 31 U.S.C. 6301-6308. This subpart explains 
the use of the contract as the award instrument for acquisition 
relationships, and the grant or cooperative agreement as the instrument 
for assistance relationships. This subpart provides guidance for 
determining whether to use the acquisition or assistance process to 
fulfill program needs.



307.7001  Distinction between acquisition and assistance.

    (a) 31 U.S.C. 6301-6308 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,

[[Page 24]]

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 Deputy Assistant 
Secretary for Acquisition Management and Policy (DASAMP).
    (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.
    (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.

[66 FR 4226, Jan. 17, 2001, as amended at 71 FR 76496, Dec. 20, 2006]



307.7002  Procedures.

    (a) OPDIV 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 HCA 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

[[Page 25]]

that unequivocally justifies the rationale for the shift.
    (c) OPDIVs must ensure that the choice of instrument is determined 
in accordance with 31 U.S.C. 6301-6308 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, OAMP, 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.



                  Subpart 307.71_Requests for Contract



307.7100  Scope of subpart.

    This subpart prescribes the format and contents of the request for 
contract (RFC) and provides procedures for its preparation and 
submission.



307.7101  General.

    The program office's preparation of the RFC and submission to the 
contracting office completes 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 
solicitation by the contracting office and sets the acquisition process 
in motion. It is the result of the planning by the project officer and 
contracting officer and contains much of the pertinent information 
necessary for the development of a sound, comprehensive solicitation.



307.7102  Procedures.

    The program office should submit the RFC to the contracting office 
no later than the date agreed to by the contracting officer and the 
project officer in the milestone schedule (see 307.104(h)), unless a 
revised due date has been established by mutual agreement.



307.7103  Responsibilities.

    (a) It is the responsibility of the project officer to prepare the 
RFC so that it complies with the requirements of this subpart and any 
OPDIV guidance issued in accordance with this subpart.
    (b) Prior to the submission of the RFC to the contracting office, 
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 
performance.



307.7104  Transmittal.

    The RFC must be conveyed to the contracting office by use of a cover 
memorandum. The cover memorandum must be signed by the head of the 
sponsoring program office and include both a statement attesting to the 
conclusiveness of the review described in 307.7103(b) and a list 
identifying all attachments to the RFC.

[71 FR 76496, Dec. 20, 2006]



307.7105  Format and content.

    The Department is in the process of standardizing a format for the 
RFC. In the interim, the information in paragraph (a) of this section 
must be included. Paragraph (b) contains information that must also be 
included if applicable.
    (a) The RFC must include:
    (1) Purpose of the contract. A brief, general description of the 
requirement, including the citation of the legislation which authorizes 
the program or project, and a statement as to the intended purpose/use 
of the proposed contract.

[[Page 26]]

    (2) 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, as well as the 
proposed starting date.
    (3) Estimated cost and funds citation. An estimate of the total cost 
of the proposed contract and, if applicable, the estimate for each phase 
indicated in the statement of work. The project officer must provide a 
cost breakdown of all contributing cost factors, an estimate of the 
technical staff hours, direct material, subcontracting, travel, etc., 
and may consult with contracting and cost advisory personnel in 
developing this information. This section must include the certification 
of funds availability for the proposed acquisition, along with the 
appropriation and accounting information citations. When funds for the 
proposed acquisition are not currently available for obligation but are 
anticipated, a statement of intent to commit funds from the financial 
management officer 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).
    (4) Specification, purchase description, or statement or work. A 
description of the work to be performed that may be in the form of a 
specification, purchase description, or statement of work. Guidance 
concerning the statement of work and its contents is contained in 
307.7106. 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. To the maximum extent possible, 
requirements should be defined as performance-based statements of work 
that focus on outcomes or results. If the RFC for a service contract is 
not utilizing a performance-based statement of work, with associated 
measures and a quality surveillance plan, the rationale for this 
determination must be documented. If a performance-based service 
contract is utilized, the RFC must detail the performance standards that 
must be met, the quality surveillance plan that will be implemented and 
the performance incentives to be used, if applicable.
    (5) Schedule of deliverables/reporting requirements. A description 
of what is to be delivered, including, if applicable, technical and 
financial progress reports and any final report, and the required date 
of delivery for each deliverable. Reporting requirements should be 
tailored to the instant acquisition and should not be unnecessarily 
extensive or detailed. All delivery and reporting requirements shall 
include the quantities, the place of delivery, and time of delivery.
    (6) Sources for solicitation. A list of known potential sources by 
name, size, type of ownership, and mailing address. The project officer 
is encouraged to use trade and professional journals and publications 
and conduct a thorough market research to identify new prospective 
sources to supplement the list of known sources. Efforts to identify 
set-aside possibilities, e.g., 8(a), HUBZone, veteran-owned, service-
disabled veteran-owned, and small business, and efforts to identify 
sources such as small disadvantaged and women-owned small businesses 
must be documented.
    (7) Project officer and alternate. The project officer's name, 
title, organization, mailing address, and telephone number, along with 
the same data for the project officer's alternate, and a statement that 
these individuals have completed the Department's project officer 
training course (see 307.l70)
    (b) The RFC must include, if applicable to the acquisition:
    (1) Background and need. The background, history, and necessity for 
the proposed contract. 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.
    (2) Reference materials. 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/

[[Page 27]]

or the contractor for use in performance of the contract. The project 
officer must indicate whether this material is currently available or 
when it will be available, and how it may be accessed by potential 
offerors.
    (3) Technical evaluation criteria and instructions. 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. 
Evaluation factors may include understanding of the problem, technical 
approach, experience, personnel, facilities, etc. Criteria areas 
discussed in the statement of work and the relative order of importance 
or weights assigned to each of these areas for technical evaluation 
purposes must be identified.
    (4) Special program clearances or approvals. The following special 
program clearances or approvals should be reviewed for applicability to 
each acquisition. Those which are applicable should be addressed during 
the planning discussions between the Project Officer and Contracting 
Officer/Contract Specialist (see 307.104(c)) and immediate action should 
be initiated by the Project Officer to obtain the necessary clearances 
or approvals. The Contracting Officer/Contract Specialist shall provide 
a comprehensive checklist of these and any OPDIV special approvals, 
clearances, and requirements to the program office. If the approval or 
clearance has been requested and is being processed at the time of RFC 
submission, a footnote to this effect, including all pertinent details, 
must be included in this section.
    (i) Commercial activities. (OMB Circular No. A-76). An 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 public-private cost 
comparison. (See OMB Circular No. A-76, Performance of Commercial 
Activities.)
    (ii) Printing. The acquisition of printing and high volume 
duplicating 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.
    (iii) Paperwork Reduction Act. Under the Paperwork Reduction Act of 
1995, 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 a request for Office of Management and 
Budget (OMB) review, to the OMB, and the OMB has approved the proposed 
collection of information. Procedures for the approval may be obtained 
by contacting the OPDIV reports clearance officer. (See 5 CFR part 
1320).
    (iv) Publications. All projects that will result in contracts which 
include publications development (print products, electronic bulletin 
boards, posting on the internet) require review and approval by the 
Office of the Assistant Secretary for Public Affairs (OASPA). Form HHS-
615, Publication Planning and Clearance Request, must be forwarded to 
OASPA through the OPDIV public affairs officer. Publications are defined 
in Chapter 5-00-15 of the Public Affairs Management Manual.
    (v) Public affairs services. Projects for the acquisition of public 
affairs services in excess of $5,000 must 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 Services Contract.
    (vi) Audiovisual. All projects which will result in contracts which 
include audiovisuals, regardless of the audio, video, or audiovisual 
medium employed, require review and approval by the Office of the 
Assistant Secretary for Public Affairs (OASPA). Form HHS-524A, 
Publication Planning and Clearance Request, must be forwarded to OASPA 
through the OPDIV public affairs officer. Audiovisuals are defined in 
chapter 6-00-15 of the Public Affairs Management Manual.
    (vii) Privacy Act (5 U.S.C. 552a). Whenever the Department contracts 
for the design, development, operation, or maintenance of a system of 
records on individuals on behalf of the Department to accomplish a 
departmental

[[Page 28]]

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 part 5b; FAR subpart 24.1 and subpart 
324.1.)
    (viii) Foreign research. 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.
    (5) Identification and disposition of data. Identification of the 
data expected to be generated by the acquisition and an indication of 
whether the data are to be delivered to the Department or to be retained 
by the contractor is required. 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.
    (6) Government property. If known, the type of Government property, 
individual items, and quantities of Government property to be furnished 
to, or allowed to be acquired by, the resultant contractor should be 
indicated. The project officer must specify when the Government property 
is to be made available.
    (7) Special terms and conditions. Any suggested special terms and 
conditions not already covered in the statement of work.
    (8) 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 is required.

[66 FR 4226, Jan. 17, 2001, as amended at 70 FR 40, Jan. 3, 2005; 71 FR 
76496, Dec. 20, 2006]



307.7106  Statement of work.

    (a) General. A statement of work (SOW) describes the work or 
services to be performed in reaching an end result without describing 
the method that will be used unless the method of performance is 
critical or required in order to obtain successful performance. The SOW 
should be clear and concise and must completely define the 
responsibilities of both the contractor and the Government. The SOW 
should be worded to make more than one interpretation virtually 
impossible.
    (b) Term (level of effort) vs. completion work statement. Careful 
distinctions must be drawn between term (level of effort) SOWs, which 
essentially require the furnishing of technical effort and which may 
include a report thereof, and completion type work statements, which 
require development of tangible items designed to meet specific 
performance and/or design characteristics. (See FAR 16.306(d) for 
distinction).
    (1) Term (or level of effort). A term or level of effort type SOW is 
appropriate for research where one seeks to discover the feasibility of 
later development, or to gather general information. A term or level of 
effort type SOW 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.
    (2) Completion. A completion type SOW is appropriate to development 
work where the feasibility of producing an end item is already known. A 
completion type SOW may describe what is to be achieved through the 
contracted effort, such as development of new methods, new end items, or 
other tangible results.
    (c) 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

[[Page 29]]

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 report submitted, that will 
provide, at the earliest possible time, appropriate data for making 
decisions relative to future phases. A phased contract may include 
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 SOW. When phases of work can be identified, 
the SOW 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 
phase, 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.
    (d) Elements of the SOW. The elements of the SOW will vary with the 
objective, complexity, size, and nature of the acquisition. In general, 
it should include the following:
    (1) Purpose of the project. This includes a general description of 
the objectives of the project and the desired results.
    (2) Background information. This includes a brief history of the 
project and the importance of the project to the overall program 
objectives.
    (3) A detailed description of the technical requirements. The 
statement of work should provide sufficient detail to accurately reflect 
the Government's requirement. It should state what is to be done without 
prescribing the method to be used and should include performance 
standards. The statement of work may be broken down into tasks and 
subtasks. The degree of breakout depends on the size and complexity of 
the project. The statement of work should indicate whether the tasks are 
sequential or concurrent.
    (4) Reference material. All reference material to be used in the 
conduct of the project that indicates 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.
    (5) 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.
    (6) Special requirements. (as applicable). An unusual or special 
contractual requirement, which would impact on contract performance, 
should be included as a separate section.
    (7) Deliverables reporting requirements. All deliverables and/or 
reports must be clearly and completely described. Include the timeframe 
for completion, the format, and the number of copies.

[66 FR 4226, Jan. 17, 2001, as amended at 71 FR 76496, Dec. 20, 2006]



307.7107  Review.

    Upon receipt of the RFC, the contracting officer shall review its 
contents to ensure that all pertinent information has been provided by 
the program office and that it includes an acceptable SOW. If pertinent 
information is missing or the SOW is inadequate, the contracting officer 
shall obtain or clarify the information as soon as possible so that the 
acquisition schedule can be met. If the program office delays furnishing 
the information or clarification, the contracting officer should notify 
the head of the sponsoring program office, in writing, of the possible 
slippage in the acquisition schedule and the need for an expeditious 
remedy. The contracting officer should also notify the chief of the 
contracting office. A program office's or project officer's continued 
failure to adhere to agreed on milestones should also be reported to the 
head of the contracting activity.

[[Page 30]]



PART 309_CONTRACTOR QUALIFICATIONS--Table of Contents




         Subpart 309.4_Debarment, Suspension, and Ineligibility

Sec.
309.403 Definitions.
309.404 List of parties excluded from Federal procurement and 
          nonprocurement programs.
309.405 Effect of listing.
309.406 Debarment.
309.406-3 Procedures.
309.407 Suspension.
309.407-3 Procedures.
309.470 Reporting of suspected causes for debarment, suspension, or the 
          taking of evasive actions.
309.470-1 Situations where reports are required.
309.470-2 Contents of reports.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4231, Jan. 17, 2001, unless otherwise noted.



         Subpart 309.4_Debarment, Suspension, and Ineligibility



309.403  Definitions.

    Acquiring agency's head or 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 written approval of the debarring or suspending official, 
as the case may be.
    Debarring official means the Assistant Secretary for Administration 
and Management, or his/her designee.
    Initiating official means either the contracting officer, the head 
of the contracting activity, the Deputy Assistant Secretary for 
Acquisition Management and Policy, or the Inspector General.
    Suspending official means the Assistant Secretary for Administration 
and Management, or his/her designee.

[71 FR 76497, Dec. 20, 2006]



309.404  List of parties excluded from Federal procurement and nonprocurement programs.

    (c) The Office of Acquisition Management and Policy (OAMP) shall 
perform the actions required by FAR 9.404(c).
    (4) OAMP 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 OAMP review.

[71 FR 76497, Dec. 20, 2006]



309.405  Effect of listing.

    (a) The head of the contracting activity (HCA) (not delegable) may, 
with the written 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. Compelling reasons for award of a contract 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; or
    (ii) The urgency of the requirement dictates that the Department 
conduct business with the listed contractor.
    (2) If the HCA decides to approve the requested action, he/she shall 
request the concurrence of the debarring or suspending official and, if 
given, shall inform the contracting officer in writing of the decision 
within the required time period.

[66 FR 4231, Jan. 17, 2001, as amended at 71 FR 76497, Dec. 20, 2006]

[[Page 31]]



309.406  Debarment.



309.406-3  Procedures.

    (a) Investigation and referral. When an apparent cause for debarment 
becomes known, the initiating official shall prepare a report containing 
the information required by 309.470-2, along with a written 
recommendation, and forward it through appropriate channels to the 
debarring official. Reports shall be forwarded in accordance with 
309.470-1. The debarring official, the Deputy Assistant Secretary for 
Acquisition Management and Policy, shall initiate an investigation.
    (b) Decision making 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 it is determined 
that debarment procedures shall commence, the debarring official shall 
consult with the Office of General Counsel and then 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 action specified in FAR 9.406-
3(b)(2). The debarring official shall also ensure that written findings 
of facts are prepared, and shall base the debarment decisions 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.

[71 FR 76497, Dec. 20, 2006]



309.407  Suspension.



309.407-3  Procedures.

    (a) Investigation and referral. When an apparent cause for 
suspension becomes known, the initiating official shall prepare a report 
containing the information required by 309.470-2 along with a written 
recommendation and forward it through appropriate channels to the 
suspending official. Reports shall be forwarded in accordance with 
309.470-1. The suspending official shall initiate an investigation.
    (b) Decision making 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 it is 
determined that suspension shall be imposed, the suspending official 
shall consult with the Office of General Counsel and then 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).

[71 FR 76497, Dec. 20, 2006]



309.470  Reporting of suspected causes for debarment or suspension, or the taking of evasive actions.



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 OAMP when:
    (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 subject, or 
any other comparable regulation, by changes of address, multiple 
addresses, formation of new companies, or by other devices.

[66 FR 4231, Jan. 17, 2001, as amended at 71 FR 76498, Dec. 20, 2006]

[[Page 32]]



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 the 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 the 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 the 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.



PART 311_DESCRIBING AGENCY NEEDS--Table of Contents




    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).



311.003  Defining Electronic Information Technology (EIT) requirements.

    HHS officials who are defining agency needs for EIT products and 
services and performing market research to meet those needs can use the 
Buy Accessible Wizard (http://www.buyaccessible.gov) managed by the 
General Services Administration to document EIT requirements, identify 
the applicable Section 508 standards, and document the market research.

[71 FR 76498, Dec. 20, 2007]



PART 312_ACQUISITION OF COMMERCIAL ITEMS--Table of Contents




    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).



          Subpart 312.1_Acquisition of Commercial Items_General



312.101  Policy.

    (a) It is HHS policy to maximize its buying power, reduce 
acquisition administrative costs, and develop long-term, mutually 
beneficial, open partnerships with best-in-class providers of products 
and services. Accordingly, HHS has implemented a Strategic Sourcing 
Program under which Indefinite-Delivery/Indefinite-Quantity contracts 
(IDIQs) and Blanket Purchase Agreements (BPAs), known as HHS-wide 
Acquisition Contracts (HWACs), are awarded to allow for savings for 
commercial items and services across HHS and make the acquisition 
process more efficient.
    (b) If consideration is being given to soliciting or acquiring a 
product or service from a source, other than HHS Contract Closeout IDIQs 
or Strategic Sourcing BPAs, when the category of the current requirement 
(e.g. Lab Supplies, Events Management) is encompassed in the portfolio 
of existing IDIQ or BPA categories a waiver request must be prepared and 
approved in advance of a purchase or processing of a requirement.

[[Page 33]]

    (c) The instructions, including approval requirements, and waiver 
form, are available at http://dbh.ogam2000.com/HHS--Strategic--Sourcing/
Data--Collection/waiver.asp.
    The following links provide more detailed information regarding the 
supplies, equipment, and services in each of the HWACs: the HHS 
Acquisition Integration and Modernization Web site: http://
intranet.hhs.gov/hwac/index.html and the HHS Strategic Sourcing Web 
site: http://intranet.hhs.gov/ssc/.

[71 FR 76498, Dec. 20, 2007]

[[Page 34]]



           SUBCHAPTER C_CONTRACTING METHODS AND CONTRACT TYPES





PART 313_SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




              Subpart 313.3_Simplified Acquisition Methods

Sec.
313.301 Governmentwide commercial purchase card.
313.303 Blanket Purchase Agreements (BPAs).
313.303-5 Purchases under BPAs.
313.305 Imprest funds and third party drafts.
313.305-1 General.
313.306 SF 44, Purchase Order--Invoice--Voucher.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4233, Jan. 17, 2001, unless otherwise noted.



              Subpart 313.3_Simplified Acquisition Methods.



313.301  Governmentwide commercial purchase card.

    (b) The Department has issued general guidance concerning the use of 
governmentwide commercial purchase cards, and has authorized the OPDIVs 
to establish procedures for the use, administrative and management 
controls, and training necessary to comply with FAR 13.301.



313.303  Blanket Purchase Agreements (BPAs).



313.303-5  Purchases under BPAs.

    (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.



313.305  Imprest funds and third party drafts.



313.305-1  General.

    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.



313.306  SF 44, Purchase Order--Invoice--Voucher.

    (d) Since the Standard Form (SF) 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_SEALED BIDDING--Table of Contents




                   Subpart 314.2_Solicitation of Bids

Sec.
314.202 General rules for solicitation of bids.
314.202-7 Facsimile bids.

           Subpart 314.4_Opening of Bids and Award of Contract

314.404 Rejection of bids.
314.404-1 Cancellation of invitations after opening.
314.407 Mistakes in bids.
314.407-3 Other mistakes disclosed before award.
314.407-4 Mistakes after award.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4233, Jan. 17, 2001, unless otherwise noted.

[[Page 35]]



                   Subpart 314.2_Solicitation of Bids



314.202  General rules for solicitation of bids.



314.202-7  Facsimile bids.

    (c) If the HCA (not delegable) has determined that the contracting 
activity will allow use of facsimile bids and proposals, the HCA shall 
prescribe internal procedures, in accordance with the FAR, to ensure 
uniform processing and control.

[71 FR 76498, Dec. 20, 2006]



           Subpart 314.4_Opening of Bids and Award of Contract



314.404  Rejection of bids.



314.404-1  Cancellation of invitations after opening.

    (c) The HCA or CCO (not delegable) shall make the determinations 
required to be made by the agency head in FAR 14.404-1.

[71 FR 76498, Dec. 20, 2006]



314.407  Mistakes in bids.



314.407-3  Other mistakes disclosed before award.

    (e) Authority has been delegated to the Departmental Protest Control 
Officer, Office of Acquisition Management and Policy, 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, General Law Division, Office of General Counsel.
    (i) Doubtful cases shall not be submitted by the Contracting Officer 
directly to the Comptroller General, but, instead, shall be submitted to 
the Departmental Protest Control Officer.

[71 FR 76498, Dec. 20, 2006]



314.407-4  Mistakes after award.

    (c) Authority has been delegated to the Departmental Protest Control 
Officer 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, General Law Division, Office of General Counsel.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76498, Dec. 20, 2006]



PART 315_CONTRACTING BY NEGOTIATION--Table of Contents




   Subpart 315.2_Solicitation and Receipt of Proposals and Information

Sec.
315.204 Contract format.
315.204-1 Uniform contract format.
315.208 Submission, modification, revision, and withdrawal of proposals.
315.209 Solicitation provisions and contract clauses.

                     Subpart 315.3_Source Selection

315.305 Proposal evaluation.
315.306 Exchanges with offerors after receipt of proposals.
315.307 Proposal revisions.
315.370 Finalization of details with the selected source.
315.371 Contract preparation and award.
315.372 Preparation of negotiation memorandum.

                     Subpart 315.4_Contract Pricing

315.404 Proposal analysis.
315.404-2 Information to support proposal analysis.
315.404-4 Profit.

                   Subpart 315.6_Unsolicited Proposals

315.605 Content of unsolicited proposals.
315.606 Agency procedures.
315.606-1 Receipt and initial review.
315.609 Limited use of data.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4233, Jan. 17, 2001, unless otherwise noted.



   Subpart 315.2_Solicitation and Receipt of Proposals and Information



315.204  Contract format.



315.204-1  Uniform contract format.

    (a) When preparing solicitations and resulting contracts, 
Contracting Officers/Contract Specialists are strongly encouraged to use 
as a guide the HHS

[[Page 36]]

Solicitation/Contract Structure Document found at http://
www.knownet.hhs.gov/acquisition/policy.htm.

[71 FR 76498, Dec. 20, 2006]



315.208  Submission, modification, revision, and withdrawal of proposals.

    (b) When the head of the contracting activity (HCA) for a health 
agency determines that certain classes of biomedical or behavioral 
research and development acquisitions should be subject to conditions 
other than those specified in FAR 52.215-1(c)(3), the HCA may authorize 
the use of the provision at 352.215-70 in addition to the provision at 
FAR 52.215-1. This is an authorized deviation.
    (2) When the provision at 352.215-70 is included in the solicitation 
and a proposal is received after the exact time specified for receipt, 
the contracting officer, with the assistance of cost and technical 
personnel, shall make a written determination as to whether the proposal 
meets the requirements of the provision at 352.215-70 and, therefore, 
can be considered.



315.209  Solicitation provisions and contract clauses.

    (a) Paragraph (e) of the provision at 352.215-1 shall be used in 
place of that specified at FAR 52.215-1(e). This is an authorized 
deviation.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76498, Dec. 20, 2006]



                     Subpart 315.3_Source Selection



315.305  Proposal evaluation.

    (a)(1) Cost or price evaluation. (i) The Contracting Officer shall 
evaluate business proposals in accordance with the requirements set 
forth in FAR 15.404. The extent of cost or price analysis in each case 
depends on the contract type, the amount of the proposal, the technical 
complexity, and related cost or price. The Project Officer shall be 
requested to analyze the following elements, if applicable, to determine 
if they are necessary and reasonable for efficient contract performance:
    (A) The number of labor hours proposed for the various labor 
categories and the mix in relation to the technical requirements;
    (B) Types, numbers and hours/days of proposed consultants;
    (C) The kinds and quantities of material, equipment, supplies, and 
services;
    (D) Kinds and quantities of information technology;
    (E) Logic of proposed subcontracting; and
    (F) Travel proposed, including number of trips, locations, purpose, 
and travelers.
    (ii) The Project Officer shall provide written comments, including 
the rationale for any exceptions to the elements. The Project Officer's 
comments shall be used for negotiations or to support award without 
discussions. The Contracting Officer should also request assistance of a 
cost/price analyst, when necessary. The Contracting Officer's 
negotiation memorandum must include the rationale used in determining 
that the price or cost is fair and reasonable.
    (2) Past performance evaluation. When evaluating past performance, 
the contracting officer is responsible for conducting reference checks 
to obtain information concerning the performance history of offerors. 
The contracting officer may require the assistance of the project 
officer as well as other Government technical personnel in performing 
this function.
    (3) Technical evaluation. (i) 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 recommended technical evaluation panel members, their 
organizations, a list of their major consulting clients (if applicable), 
their qualifications, and curricula vitae (if applicable);
    (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);

[[Page 37]]

    (3) A statement that there is no apparent or actual conflict of 
interest regarding any recommended 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 shall be submitted to the 
Contracting Officer for review and approval before the solicitation is 
issued. The Contracting Officer shall make sure that the significant 
factors and subfactors relating to the evaluation are reflected in the 
evaluation criteria when conducting the review of the plan.
    (ii) Technical evaluation panel.
    (A) General. (1) A technical evaluation panel is required for all 
acquisitions subject to this subpart which are expected to exceed 
$500,000 and in which technical evaluation is considered a key element 
in the award decision. The contracting officer has the discretion to 
require a technical evaluation panel for acquisitions not exceeding 
$500,000 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 capable of identifying strengths and weaknesses in the 
proposals received. Government employees serving as panel members must 
be selected in accordance with the requirements set forth in 307.170.
    (3) The Project Officer shall ensure that persons possessing 
expertise and experience in addressing issues relative to sex, race, 
national origin, and handicapped discrimination are included as panel 
members for acquisitions in which such issues are applicable.
    (4) The Project Officer shall submit the list of recommended panel 
members to an official within the project office in a position at least 
one level higher. This official will review the list 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 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;
    (ii) Provide assistance to the evaluators as required; and
    (iii) Ensure that the scores adequately reflect the written 
technical report comments.
    (D) Conflict 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 Standards of Ethical Conduct for Employees of the 
Executive Branch (5 CFR part 2635), Supplemental Standards of Ethical 
Conduct for Employees of the Department of Health and Human Services (5 
CFR part 5501), and the Procurement Integrity Act. For outside 
evaluators serving on the technical evaluation panel, see paragraph 
(a)(3)(ii)(F) of this section.
    (E) Continuity of evaluation process. (1) The technical evaluation 
panel shall evaluate all original proposals, make

[[Page 38]]

recommendations to the chairperson regarding strengths and weaknesses of 
proposals, and, if required by the Contracting Officer, assist the 
Contracting Officer during communications and discussions, and review 
supplemental, revised and/or final proposal revisions. 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 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;
    (ii) Final proposal revisions 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 remove and/or replace the individual after discussing the 
situation with the contracting officer and obtaining his/her concurrence 
and the approval of the official responsible for appointing the panel 
members.
    (4) When continuity of the evaluation process is not possible, and 
either new evaluators are selected or the size of the evaluation panel 
is reduced, all proposals shall be reviewed by each panel member at the 
current stage of the acquisition (i.e., initial proposal, final proposal 
revisions, etc.). Also, guidance should be provided concerning what to 
do if an unusually large number of proposals are received, including how 
to determine what constitutes an unusually large number of proposals.
    (F) Use of outside evaluators. (1) The National Institutes of Health 
(NIH) and the Substance Abuse and Mental Health Services Administration 
(SAMHSA) are required to have a peer review of research and development 
contracts in accordance with Public Law 93-352 as amended by Public Law 
94-63; 42 U.S.C. 289 a and 42 U.S.C. 290aa-3 respectively. 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 SAMHSA are therefore exempt from 
the provisions of 315.305(a)(3)(ii) to the extent that 42 U.S.C. 289a 
and 290aa-3 apply. Conflicts of interest are addressed at 42 CFR part 
52h. Other agencies subject to statutory scientific peer review 
requirements are also exempt from the requirements of paragraph 
(a)(3)(ii) of this section to the extent that these requirements are 
inconsistent with their legislative requirements.
    (2) Decisions to disclose proposals to evaluators outside of the 
Government shall be made by the official responsible for appointing 
panel members in accordance with operating division procedures. The 
avoidance of organization conflict of interest and competitive 
relationships must be taken into consideration when making the decision 
to use outside evaluators.
    (3) 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 evaluator(s) 
prior to disclosure:

                   Conditions for Evaluating Proposals

    The evaluator agrees to use the data (trade secrets, business data, 
and technical data) contained in the proposal for evaluation purposes 
only.
    The foregoing requirement does not apply to data obtained from 
another source without restriction.
    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 to the 
Government the furnished copy of the proposal or abstract, and

[[Page 39]]

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 
aspects of its contents.
    The evaluator's employees and subcontractors shall abide by these 
conditions.

    (iii) 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.
    (B) The transmittal memorandum shall include at least the following:
    (1) A list of the names of the organizations submitting proposals;
    (2) A reference to the need to preserve the integrity of the source 
selection process;
    (3) A statement that only the contracting officer is to conduct 
discussions.
    (4) A requirement for a technical evaluation report in accordance 
with paragraph (a)(3)(vi) of this section; and
    (5) The establishment of a date for receipt of the technical 
evaluation report.
    (iv) 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 prior to 
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 by the chairperson.
    (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) Explanation of conflicts of interest;
    (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.
    (v) Rating and ranking of proposals. The evaluators will 
individually read each proposal, describe tentative strengths and 
weaknesses, and independently develop preliminary scores in relation to 
each evaluation factor set forth in the solicitation. After this has 
been accomplished, the evaluators shall discuss in detail the individual 
strengths and weakness 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

[[Page 40]]

the numerical scores assigned to the evaluation factors 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.
    (vi) 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. The report must also include a 
narrative evaluation specifying the strengths and weaknesses of each 
proposal, a copy of each signed 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.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76498, Dec. 20, 2006]



315.306  Exchanges with offerors after receipt of proposals.

    (d) Exchanges with offerors after establishment of the competitive 
range. 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, past performance 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 should be developed so as to disclose the 
ambiguities, uncertainties, and deficiencies of the offeror.



315.307  Proposal revisions.

    (b) Final proposal revisions 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. A final evaluation of 
past performance will be made by the contracting officer and project 
officer. The technical evaluation panel may be involved in the final 
evaluation of past performance if the panel is comprised solely of 
Government personnel.



315.370  Finalization of details with the selected source.

    (a) After selection of the successful proposal, finalization of 
details 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 after the common cutoff date for receipt of final 
proposal revisions. The finalization process shall not in any way 
prejudice the competitive interest or rights of the unsuccessful 
offerors. Finalization of details with the selected offeror shall be 
restricted to definitizing the final agreement on terms and conditions, 
assuming none of these factors were involved in the selection process.
    (b) Caution must be exercised by the contracting officer to insure 
that the finalization process is not used to change the requirements 
contained in the solicitation, nor to make any other changes which would 
impact on the source selection decision. Whenever a

[[Page 41]]

material change occurs in the requirements, the competition must be 
reopened and all offerors submitting final proposal revisions 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 the changes alter the factors involved in 
the original selection process.
    (c) Should finalization details beyond those specified in paragraph 
(a) of this section be required for any reason, discussions must be 
reopened with all offerors submitting final proposal revisions.
    (d) Upon finalization of details, the contracting officer should 
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.



315.371  Contract preparation and award.

    (a) After details have been finalized with the selected offeror, the 
Contracting Officer shall:
    (1) Prepare the negotiation memorandum in accordance with 315.372;
    (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 the proposed contract 
award(s) 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.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76499, Dec. 20, 2006]



315.372  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 Contracting Officer/Contract Specialist to support the source 
selection decision discussed in FAR 15.308. 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. The 
negotiation memorandum shall address each item listed below. If an item 
is not applicable, it shall be so stated in the memorandum. Information 
already contained in the contract file may be referenced rather than 
reiterated.
    (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.
    (b) Acquisition planning. Summarize or reference any acquisition 
planning activities that have taken place.
    (c) Synopsis of 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 
contractual instrument recommended for the acquisition. 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.
    (f) Technical evaluation. Summarize or reference the results 
presented in the technical evaluation report.

[[Page 42]]

    (g) Business evaluation. Summarize or reference results presented in 
the business report.
    (h) Past performance. Summarize or reference results of past 
performance evaluation and reference checks.
    (i) Competitive range (if applicable). Describe how the competitive 
range was determined and state the offerors who were included in the 
competitive range and the ones who were not.
    (j) 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 
information such as:
    (1) A comparison of cost factors proposed in the instant case with 
actual factors used in earlier contracts, using the same cost centers of 
the same supplier or cost centers of other sources having recent 
contracts for the same or similar item.
    (2) Any pertinent Government-conducted audit of the proposed 
contractor's record of any pertinent cost advisory report.
    (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 all elements of 
profit and fee structure.
    (6) A justification of the reasonableness of the proposed 
contractor's estimated profit or fixed fee, considering the requirements 
of FAR 15.404-4 and HHSAR 315.404-4.
    (k) Cost realism. Describe the cost realism analysis performed on 
proposals.
    (l) Government-furnished property and Government-provided 
facilities. With respect to Government-furnished or Government-provided 
facilities, equipment, tooling, or other property, include the 
following:
    (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.
    (m) 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 
15.406-3. In addition, if cost or pricing data was required to be 
submitted, 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.
    (n) 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, 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.
    (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

[[Page 43]]

with FAR 37.103, that the services to be acquired are nonpersonal in 
nature.
    (o) Terms and conditions. Identify the general and special clauses 
and conditions that are contained in the contract, such as option 
arrangements, incremental funding, anticipatory costs, deviations from 
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.
    (p) Recommendation. A brief statement setting forth the 
recommendations for award.
    (q) Signature. The memorandum must be signed by the contract 
negotiator who prepared the memorandum.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76499, Dec. 20, 2006]



                     Subpart 315.4_Contract Pricing



315.404  Proposal analysis.



315.404-2  Information to support proposal analysis.

    (a)(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.
    (3) 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 
solicitation, 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;
    (v) Identify the office having audit responsibility if other than 
the 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.) 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. 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.



315.404-4  Profit.

    (b) Policy. (1) The structured approach for determining profit or 
fee (hereafter called profit) provides a technique for establishing a 
profit objective for negotiation. 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 technique allows for 
consideration of the profit factors described in paragraph (d) of this 
section. The Contracting Officer's analysis of these factors is based on 
available information such as proposals, audit data, assessment reports, 
preaward surveys, etc. The structured approach provides a basis for 
documenting the profit objective. Any significant departure from this 
objective shall be explained. The amount of documentation depends on the 
dollar value and complexity of the proposed acquisition. The profit 
objective is a part of the overall negotiation objective and is directly 
related to

[[Page 44]]

the cost objective and any proposed sharing arrangement. The profit 
objective should be negotiated at the same time as the other cost items. 
The profit objective should be negotiated as a whole and not as 
individual profit factors.
    (ii) The profit analysis factors in FAR 15.404-4(d) shall be used in 
lieu of the structured approach in the following circumstances. Factors 
considered inapplicable to the acquisition shall be excluded from the 
profit objective. Documentation shall be provided which includes the 
profit factor breakdown.
    (A) Contracts not expected to exceed $100,000;
    (B) Architect-engineer contracts;
    (C) Management contracts for operations and/or maintenance of 
Government facilities;
    (D) Construction contracts;
    (E) Contracts primarily requiring delivery of material supplies by 
subcontractors;
    (F) Termination settlements; and
    (G) 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). Other exceptions may be 
made in the negotiation of contracts having unusual pricing situations, 
but shall be justified in writing by the contracting officer in 
situations where the structured approach is determined to be unsuitable.
    (c) Contracting Officer responsibilities. The Contracting Officer 
shall develop the profit objective. This objective shall realistically 
reflect the total overall task to be performed and the requirements 
placed on the contractor. The Contracting Officer shall not begin to 
develop the profit objective until a thorough review of proposed 
contract work has been made; 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, 
has been conducted; and an analysis of the contractor's cost estimate 
and comparison with the Government's estimate or projection of cost has 
been made.
    (d) Profit--analysis factors--(1) Common factors. 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.

------------------------------------------------------------------------
             Profit factors                 Weight ranges (in 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...................
------------------------------------------------------------------------

    (i) The Contracting Officer shall measure ``Contractor Effort'' by 
assigning a profit percentage within the designated weight range to each 
element of contract cost. The categories listed are for reference 
purposes only, but are broad and basic enough to provide guidance to 
other elements of cost. Facilities capital cost of money is not to be 
included. A total dollar profit shall be computed for ``Contractor 
Effort.''
    (ii) The Contracting Officer shall use the total dollar profit for 
the ``Contractor Effort'' to calculate specific profit dollars for 
``Other Factors''--cost risk, investment, performance, socioeconomic 
programs, and special situations. The Contracting Officer shall multiply 
the total dollar profit for the ``Contractor Effort'' by the weight 
assigned to each of the elements in the ``Other Factors'' category. 
Facilities capital cost of money is not included. Form HHS-674, 
Structured Approach Profit/Fee Objective, should be used. Form HHS-674 
is illustrated in 353.370-674.
    (iii) 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.
    (iv) The structured approach was designed for arriving at profit 
objectives for other than nonprofit organizations. However, the 
structured approach can be used for nonprofit organizations if

[[Page 45]]

appropriate adjustments are made. The Contracting Officer shall use the 
modified structured approach in paragraph (d)(1)(iv)(B) of this section 
to establish profit objectives for nonprofit organizations.
    (A) 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.
    (B) 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;
    (1) Tax position benefits;
    (2) Granting of financing through advance payments; and
    (3) Other pertinent factors which may work to either the advantage 
or disadvantage of the contractor in its position as a nonprofit 
organization.
    (2) Contractor effort. 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:
    (i) 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.
    (ii) 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 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

[[Page 46]]

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 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 in 
this paragraph will be applied.
    (iii) Overhead and general management (G&A). (A) 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 should 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.
    (B) 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 these 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.
    (C) 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.
    (D) 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 pool or the contract circumstances, or 
the factors discussed in paragraph (d)(2)(iii)(C) of this section are 
involved.
    (iv) Other costs. Analysis of this factor should include all other 
direct costs associated with contractor performance (e.g., travel and 
relocation, direct

[[Page 47]]

support, and consultants). Analysis of these items of cost should 
include, the significance of the cost of contract performance, nature of 
the cost, and 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%. 
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 fields 
such as medicine or human services. In these instances, the contractor 
will be required to expend greater managerial and technical effort to 
obtain these services and, consequently, the costs should receive a much 
greater weight.
    (3) Other factors (i) 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.
    (A) 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 objective. Evaluation of this risk requires a determination of 
the degree of cost responsibility the contractor assumes; the 
reliability of the cost estimates in relation to the task assumed; and 
the complexity of the task assumed by the contractor. This factor is 
specifically limited to the risk of contract costs. Thus, risks on the 
part of the contractor such 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.
    (B) 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
------------------------------------------------------------------------

    (C) 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.
    (D) The third determination is that of the difficulty of the 
contractor's task. The contractor's task can be difficult or easy, 
regardless of the type of contract.
    (E) 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

[[Page 48]]

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:
    (1) Type of contract and percentage ranges for profit objectives 
developed by using the structured approach for research and development 
and manufacturing contracts:

------------------------------------------------------------------------
                                                       Percent
------------------------------------------------------------------------
Cost-Plus-fixed fee.......................  0 to 0.5
Cost-plus-incentive fee:
  With cost incentive only................  1 to 2
  With multiple incentives................  1.5 to 3
Fixed-price-incentive:
  With cost incentive only................  2 to 4
  With multiple incentives................  3 to 5
  Prospective price redetermination.......  3 to 5
  Firm fixed-price........................  5 to 7
------------------------------------------------------------------------

    (2) Type of contract and percentage ranges for profit objectives 
developed by using the structured approach for service contracts:

------------------------------------------------------------------------
                                                       Percent
------------------------------------------------------------------------
Cost-plus-fixed-fee.......................  0 to 0.5
Cost-plus-incentive fee...................  1 to 2
Fixed-price incentive.....................  2 to 3
Firm fixed-price..........................  3 to 4
------------------------------------------------------------------------

    (F) 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.
    (G) The contractor's subcontracting program may have a significant 
impact on the contractor's acceptance or 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.
    (H) 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 basic ordering agreements, 
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 of work completed prior to definitization.
    (I) 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 paragraph (b)(1)(ii) of 
this section in the evaluation of the contractor's assumption of 
contract cost risk.

[[Page 49]]

    (ii) 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:
    (A) 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 these 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 purposed under CAS 414 can 
help the contracting officer identify the level of facilities investment 
to be employed in contract performance.
    (B) 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.
    (iii) 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 these areas in comparison 
with other contractors in similar circumstances, this 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.
    (iv) 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 Government sponsored 
programs such as small business, small disadvantaged business, women-
owned small business, service-disabled veterans, handicapped sheltered 
workshops, 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.
    (v) Special situations (A) Inventive and developmental 
contributions. The extent 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 the effort will benefit the

[[Page 50]]

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.
    (B) 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 these circumstances, the 
contractor should receive favorable consideration in developing the 
profit objective.
    (C) 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).
    (4) 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.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76499, Dec. 20, 2006]



                   Subpart 315.6_Unsolicited Proposals



315.605  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 15.604 resulting in an 
unfair advantage to an offeror, the contracting officer 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 15.604.
    (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.)



315.606  Agency procedures.

    (a) The HCA is responsible for establishing procedures to comply 
with FAR 15.606(a).
    (b) The HCA or the HCA's designee shall be the point of contact for 
coordinating the receipt and handling of unsolicited proposals.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76500, Dec. 20, 2006]



315.606-1  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 grounds that 
they lack scientific merit.



315.609  Limited use of data.

    The legend, Use and Disclosure of Data, prescribed in FAR 15.609(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

[[Page 51]]

Information Act. Because of this possibility, the following notice shall 
be provided to all prospective offerors of unsolicited proposals:

    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 
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.

[66 FR 4233, Jan. 17, 2001, as amended at 71 FR 76500, Dec. 20, 2006]



PART 316_TYPES OF CONTRACTS--Table of Contents




               Subpart 316.3_Cost-Reimbursement Contracts

Sec.
316.307 Contract clauses.
316.505 Ordering.

   Subpart 316.6_Time-and-Materials, Labor-Hour, and Letter Contracts

316.603 Letter contracts.
316.603-3 Limitations.
316.603-70 Information to be furnished when requesting authority to 
          issue a letter contract.
316.603-71 Approval for modifications to letter contracts.

                        Subpart 316.7_Agreements

316.770 Unauthorized types of agreements.
316.770-2 Memorandums of understanding.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4243, Jan. 17, 2001, unless otherwise noted.



               Subpart 316.3_Cost-Reimbursement Contracts



316.307  Contract clauses.

    (a) If the contract is with a hospital (profit or nonprofit) for 
research and development, 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 all solicitations and resultant cost-
reimbursement contracts.



316.505  Ordering.

    (b)(5) The Department's task-order and delivery-order ombudsman is 
the Director, Strategic Acquisition Service, Program Support Center 
(PSC). The task-order and delivery-order ombudsmen for each of the 
Department's contracting activities are as follows:

AHRQ--Director, Office of Performance Accountability, Resources and 
    Technology
CDC--Chief Information Officer
CMS--Chief Operating Officer
FDA--Director, Office of Acquisitions and Grants Services
HRSA--Associate Administrator, Office of Administration and Financial 
    Management
Indian Health Service--Director, Office of Management Services
NIH--Senior Scientific Advisor for Extramural Research, Office of 
    Extramural Research (R&D) and Senior Advisor to the Director (Other 
    than R&D)
PSC--Director, Strategic Acquisition Service
SAMHSA--Executive Officer

[71 FR 76500, Dec. 20, 2006]



   Subpart 316.6_Time-and-Materials, Labor-Hour, and Letter Contracts



316.603  Letter contracts.



316.603-3  Limitations.

    An official one level above the Contracting Officer shall make the 
written determination.

[71 FR 76500, Dec. 20, 2006]

[[Page 52]]



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 a proposed letter contract. If more 
than 180 days, complete justification must be given.
    (l) Statement of any substantive matters that need to be resolved.



316.603-71  Approval for modifications to letter contracts.

    All letter contract modifications (amendments) must be approved one 
level above the contracting officer. Request 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



316.770  Unauthorized types of agreements.



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 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--Table of Contents




                          Subpart 317.2_Options

Sec.
317.201 Definition.

[[Page 53]]

317.204 Contracts.

  Subpart 317.71_Supply and Service Acquisitions Under the Government 
                         Employees Training Act.

317.7100 Scope of subpart.
317.7101 Applicable regulations.
317.7102 Acquisition of training.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4244, Jan. 17, 2001, unless otherwise noted.



                          Subpart 317.2_Options



317.201  Definitions.

    An option must:
    (a) 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;
    (b) Establish a price or specify a method of calculation which will 
make the price certain;
    (c) Be agreed to and included in the initial contract award; and
    (d) Permit the Government the right to exercise the option 
unilaterally.



317.204  Contracts.

    The total of the basic and option periods shall not exceed 10 years 
in the case of services and the total of the basic and option quantities 
shall not exceed the requirement for 5 years in the case of supplies. 
These limitations do not apply to information technology contracts. 
However, statutes applicable to various classes of contracts may place 
additional restrictions on the length of contracts.

[70 FR 11583, Mar. 9, 2005]



  Subpart 317.71_Supply and Service Acquisitions Under the Government 
                         Employees Training Act



317.7100  Scope of subpart.

    This subpart provides alternate methods for obtaining training under 
the Government Employees Training Act (GETA), 5 U.S.C. Chapter 41.



317.7101  Applicable regulations.

    Basic policy, standards, and delegations of authority to approve 
training are contained in HHS Personnel Manual Instruction 410-1.



317.7102  Acquisition of training.

    (a) Off-the-shelf training, whether for individuals or for groups of 
employees, shall be acquired under the GETA by officials delegated 
authority in HHS Transmittal 95.5, Personnel Manual (3/30/95).
    (b) 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 54]]



                   SUBCHAPTER D_SOCIOECONOMIC PROGRAMS





PART 319_SMALL BUSINESS PROGRAMS--Table of Contents




                         Subpart 319.2_Policies

Sec.
319.201 General policy.

               Subpart 319.5_Set-Asides for Small Business

319.501 General.
319.506 Withdrawing or modifying set-asides.

 Subpart 319.7_Subcontracting With Small Business, Small Disadvantaged 
            Business and Women-Owned Small Business Concerns

319.705 Responsibilities of the contracting officer under the 
          subcontracting assistance program.
319.705-5 Awards involving subcontracting plans.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4244, Jan. 17, 2001, unless otherwise noted.



                         Subpart 319.2_Policies



319.201  General policy.

    (d) The functional management responsibilities for the Department's 
Small Business Program, (small, HUBZone, small disadvantaged, and women-
owned small business programs) are delegated to the Director of the 
Office of Small and Disadvantaged Business Utilization (OSDBU).
    (e)(1) The Department's Small Business Program shall be carried out 
by appointed small business specialists (SBS) co-located within the 
OPDIVs. Appointments, and termination of appointments, shall be made in 
writing by the Director, Office of Small and Disadvantaged Business 
Utilization (OSDBU). The Director, OSDBU, will exercise full management 
authority over small business specialists.
    (2) One or more qualified SBS shall be appointed in the following 
activities: Agency for Healthcare Research and Quality (AHRQ), Centers 
for Medicare & Medicaid Services (CMS), Substance Abuse and Mental 
Health Services Administration (SAMHSA), Food and Drug Administration 
(FDA), Health Resources and Services Administration (HRSA), Indian 
Health Service (IHS), National Institutes of Health (NIH), Centers for 
Disease Control (CDC), Program Support Center (PSC), and the Office of 
the Secretary (OS).

[66 FR 4244, Jan. 17, 2001, as amended at 71 FR 76500, Dec. 20, 2006]



               Subpart 319.5_Set-Asides For Small Business



319.501  General.

    (e) Subsequent to the Contracting Officer's recommendation on Form 
HHS-653, Small Business Set-Aside Review Form, the SBS shall review each 
proposed acquisition strategy and either concur or non-concur with the 
Contracting Officer's recommendation. The Small Business 
Administration's Procurement Center Representative (SBA/PCR) shall also 
review the acquisition strategy and either concur or non-concur with the 
Contracting Officer's recommendation. If the Contracting Officer 
disapproves the SBS's and/or the SBA PCR's set-aside recommendation, the 
reasons must be documented on the Form HHS-653, and the form placed in 
the contract file. The Contracting Officer will make the final 
determination as to whether the proposed acquisition will be set-aside 
or not.

[71 FR 76501, Dec. 20, 2006]



319.506  Withdrawing or modifying set-asides.

    (d) Immediately upon notice from the contracting officer, the SBS 
shall provide telephone notification regarding all set-aside withdrawals 
to the OSDBU Director.

[[Page 55]]



 Subpart 319.7_Subcontracting With Small Business, Small Disadvantaged 
            Business and Women-Owned Small Business Concerns



319.705  Responsibilities of the contracting officer under the subcontracting assistance program.



319.705-5  Awards involving subcontracting plans.

    (a)(3) The SBA PCR shall be allowed a period of one to five working 
days to review the contract award package, depending upon the 
circumstances and complexity of the individual acquisition.



PART 323_ENVIRONMENT, ENERGY AND WATER EFFICIENCY, RENEWABLE ENERGY TECHNOLOGIES, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE--Table of Contents




                    Subpart 323.70_Safety and Health

Sec.
323.7000 Scope of subpart.
323.7001 Policy.
323.7002 Actions required.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4245, Jan. 17, 2001, unless otherwise noted.



                    Subpart 323.70_Safety and Health



323.7000  Scope of subpart.

    This subpart prescribes the use of a safety and health clause in 
contracts involving hazardous materials or operations, and provides 
procedures for administering safety and health provisions.



323.7001  Policy.

    Various statutes and regulations (e.g. Walsh-Healy Act; Service 
Contract Act) require adherence to minimum safety and health standards 
by contractors engaged in potentially hazardous work. The guidance 
contained in FAR subpart 23.3 shall be used for hazardous materials as 
the primary reference. When the guidance is judged insufficient or does 
not meet the safety and health situation in the instant acquisition, 
this subpart shall be followed.



323.7002  Actions required.

    (a) Contracting activities. Contracting activities shall use the 
clause set forth in 352.223-70, or a clause reading substantially the 
same, in prospective contracts and subcontracts involving hazardous 
materials or operations for the following:
    (1) Services or products;
    (2) Research, development, or test projects;
    (3) Transportation of hazardous materials; and
    (4) Construction, including construction of facilities on the 
contractor's premises.
    (b) Safety officers. OPDIV safety officers shall advise and assist 
initiators of acquisition requests and contracting officers in:
    (1) Determining whether safety and health provisions should be 
included in a prospective contract;
    (2) Evaluating a prospective contractor's safety and health 
programs; and
    (3) Conducting post-award reviews and surveillance to the extent 
deemed necessary.
    (c) Initiators. Initiators of acquisition requests for items 
described in paragraph (a) of this section shall:
    (1) During the preparation of a request for contract, and in the 
solicitation, ensure that hazardous materials and operations to be used 
in the performance of the contract are clearly identified; and
    (2) During the period of performance:
    (i) Apprise the contracting office of any noncompliance with safety 
and health provisions identified in the contract; and
    (ii) Cooperate with the safety officer in conducting review and 
surveillance activities.



PART 324_PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION--Table of Contents




             Subpart 324.1_Protection of Individual Privacy

Sec.
324.000 Scope of subpart.
324.102 General.
324.103 Procedures.

[[Page 56]]

                Subpart 324.2_Freedom of Information Act

324.203 Policy.

              Subpart 324.70_Confidentiality of Information

324.7001 General.
324.7002 Policy.
324.7003 Applicability.
324.7004 Required clause.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4245, Jan. 17, 2001, unless otherwise noted.



             Subpart 324.1_Protection of Individual Privacy



324.000  Scope of subpart.

    This part prescribes policies and procedures that apply requirements 
of the Privacy Act of 1974 (5 U.S.C. 552a) (the Act) and OMB Circular A-
130, Revised, November 30, 2000, to Government contracts and cites the 
Freedom of Information Act (5 U.S.C. 552, as amended).

[70 FR 40, Jan. 3, 2005]



324.102  General.

    (a) It is the Department's policy to protect the privacy of 
individuals to the maximum possible extent while permitting the exchange 
of records required to fulfill the Department's administrative and 
program responsibilities and its responsibilities for disclosing records 
to which the general public is entitled under the Freedom of Information 
Act (5 U.S.C. 552). The Privacy Act of 1974 and the Department's 
implementation under 45 CFR part 5b apply ``when an agency provides by a 
contract for the operation by or on behalf of the agency of a system of 
records to accomplish any agency function* * *'' The key factor is 
whether a departmental function is involved. Therefore, the Privacy Act 
requirements apply to a departmental contract when, under the contract, 
the contractor must maintain or operate a system of records to 
accomplish a departmental function.
    (e) The program official, and, as necessary, the official designated 
as the activity's Privacy Act Coordinator and the Office of General 
Counsel, shall determine the applicability of the Act to each proposed 
acquisition. The program official is required to include a statement in 
the request for contract indicating whether the Privacy Act is or is not 
applicable to the proposed acquisition.
    (f) Whenever the contracting officer is informed that the Privacy 
Act is not applicable, but the resultant contract will involve the 
collection of individually identifiable personal data by the contractor, 
the contracting officer shall include provisions to protect the 
confidentiality of the records and the privacy of individuals identified 
in the records (see subpart 324.70).



324.103  Procedures.

    (a) All requests for contract shall be reviewed by the contracting 
officer to determine whether the Privacy Act requirements are 
applicable. The Privacy Act requirements are applicable when the 
contract will require the contractor to design, develop, or operate any 
Privacy Act system of records on individuals to accomplish an agency 
function. When applicable, the contracting officer shall include the 
solicitation notification and contract clause required by FAR 24.104 in 
the solicitation, and the contract clause in the resultant contract. In 
addition, the contracting officer shall ensure that the solicitation 
notification, contract clause, and other pertinent information specified 
in this subpart are included in any contract modification which results 
in the Privacy Act requirements becoming applicable to a contract.
    (b)(1) The Contracting Officer shall identify in the contract work 
statement the system(s) of records to which the Privacy Act and the 
implementing regulations are applicable.
    (2) The Contracting Officer shall include the clause specified in 
352.270-11 in Section H of any RFP or resulting contract to notify the 
contractor that it and its employees are subject to criminal penalties 
for violations of the Act (5 U.S.C. 552a(i)) to the same extent as HHS 
employees. The clause also requires that the contractor ensure that each 
of its employees knows the prescribed rules of conduct and each 
contractor employee is aware that he/she is subject to criminal 
penalties for violations of the Act. These provisions

[[Page 57]]

also apply to all subcontracts awarded under the contract which require 
the design, development or operation of a system of records. The 
Contracting Officer shall send the contractor a copy of 45 CFR part 5b, 
which includes the rules of conduct and other Privacy Act requirements.
    (c) The Contracting Officer shall specify in the contract work 
statement and award the disposition to be made of the system(s) of 
records upon completion of contract performance. The contract work 
statement may require the contractor to destroy the records, remove 
personal identifiers, or turn the records over to the Contracting 
Officer. If there is a legitimate need for a contractor to keep copies 
of the records after completion of a contract, the contractor must take 
measures, as approved by the Contracting Officer, to keep the records 
confidential and protect the individuals' privacy.
    (d) Whenever an acquisition is determined to be subject to the 
Privacy Act requirements, a ``system notice,'' prepared by the program 
official and describing the Department's intent to establish a new 
system of records on individuals, to make modifications to an existing 
system, or to disclose information in regard to an existing system, is 
required to be published in the Federal Register. A copy of the ``system 
notice'' shall be attached to the request for contract or purchase 
request. If a ``system notice'' is not attached, the contracting officer 
shall inquire about its status and shall obtain a copy from the program 
official for inclusion in the contract file. If a ``system notice'' has 
not been published in the Federal Register, the contracting officer may 
proceed with the acquisition but shall not award the contract until the 
``system notice'' is published, and publication is verified by the 
contracting officer.

[66 FR 4245, Jan. 17, 2001, as amended at 71 FR 76501, Dec. 20, 2006]



                Subpart 324.2_Freedom of Information Act



324.203  Policy.

    (a) The Department's regulation implementing the Freedom of 
Information Act (FOIA), 5 U.S.C. 552, as amended, is set forth in 45 CFR 
part 5.
    (b) The Contracting Officer, upon receiving a Freedom of Information 
Act (FOIA) request, shall follow Department and OPDIV procedures. As 
necessary, actions should be coordinated with the cognizant Freedom of 
Information (FOI) Officer and the General Law Division of the Office of 
General Counsel. The Contracting Officer must remember that only the FOI 
Officer has the authority to release or deny release of records. While 
the Contracting Officer should be familiar with the entire FOIA 
regulation in 45 CFR part 5, particular attention should be focused on 
Sec. Sec.  5.65 and 5.66; also of interest are Sec. Sec.  5.32, 5.33, 
and 5.35.

[66 FR 4245, Jan. 17, 2001. Redesignated and amended at 71 FR 76501, 
Dec. 20, 2006]



              Subpart 324.70_Confidentiality of Information



324.7001  General.

    In performance of certain HHS contracts, it is necessary for the 
contractor to generate data, or be furnished data by the Government, 
which is about individuals, organizations, or Federal programs. This 
subpart and the accompanying contract clause require contractors to 
prudently handle disclosure of certain types of information not subject 
to the Privacy Act or the HHS human subject regulations set forth in 45 
CFR part 46. This subpart and contract clause address the kinds of data 
to be generated by the contractor and/or data to be furnished by the 
Government that are considered confidential and how it should be 
treated.



324.7002  Policy.

    It is the policy of HHS to protect personal interests of 
individuals, corporate interests of non-governmental organizations, and 
the capacity of the Government to provide public services when 
information from or about individuals, organizations, or Federal 
agencies is provided to or obtained by contractors in performance of HHS 
contracts. This protection depends on the contractor's recognition and 
proper

[[Page 58]]

handling of the information. As a result, the ``Confidentiality of 
Information'' contract clause was developed.



324.7003  Applicability.

    (a) The ``Confidentiality of Information'' clause, set forth in 
352.224-70, should be used in solicitations and resultant contracts 
whenever the need exists to keep information confidential. Examples of 
situations where the clause may be appropriate include:
    (1) Studies performed by the contractor which generate information 
or involve Government-furnished information that is personally 
identifiable, such as medical records, vital statistics, surveys, and 
questionnaires;
    (2) Contracts which involve the use of salary structures, wage 
schedules, proprietary plans or processes, or confidential financial 
information of organizations other than the contractor's; and
    (3) Studies or research which may result in preliminary or 
invalidated findings which, upon disclosure to the public, might create 
erroneous conclusions which, if acted upon, could threaten public health 
or safety.
    (b) With regard to protecting individuals, this subpart and contract 
clause are not meant to regulate or control the method of selecting 
subjects and performing studies or experiments involving them. These 
matters are dealt with in the HHS regulation entitled ``Protection of 
Human Subjects,'' 45 CFR Part 46. If a system of records under contract, 
or portions thereof, is determined to be subject to the requirements of 
the Privacy Act, in accordance with FAR 24.1 and 324.1 and Title 45 CFR 
part 5b, the procedures cited in those references are applicable and the 
Privacy Act contract clause shall be included in the contract. If the 
contract also involves confidential information, as described in this 
section, which is not subject to the Privacy Act, the contract shall 
include the ``Confidentiality of Information'' clause in addition to the 
Privacy Act clause.



324.7004  Required clause.

    The clause set forth in 352.224-70 shall be included in any RFP and 
resultant contract(s) where it has been determined that confidentiality 
of information provisions may apply. Any RFP announcing the intent to 
include this clause in any resultant contract(s) shall indicate, as 
specifically as possible, the types of data which would be covered and 
requirements for handling the data.

[[Page 59]]



              SUBCHAPTER E_GENERAL CONTRACTING REQUIREMENTS





PART 328_BONDS AND INSURANCE--Table of Contents




                         Subpart 328.3_Insurance

Sec.
328.301 Policy.
328.311 Solicitation provision and contract clause on liability 
          insurance under cost-reimbursement contracts.
328.311-2 Agency solicitation provisions and contract clauses.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4247, Jan. 17, 2001, unless otherwise noted.



                         Subpart 328.3_Insurance



328.301  Policy.

    It is Department policy to limit the Government's reimbursement of 
its contractors' liability to third persons for claims not covered by 
insurance in cost-reimbursement contracts to the Limitation of Funds or 
Limitation of Cost clause of the contract. In addition, the amount of 
the Government's reimbursement will be limited to final judgments or 
settlements approved in writing by the Government.



328.311  Solicitation provision and contract clause on liability insurance under cost-reimbursement contracts.



328.311-2  Agency solicitation provisions and contract clauses.

    The contracting officer shall insert the clause at 352.228-7, 
Insurance--Liability to Third Persons, in all solicitations and 
resulting cost-reimbursement contracts, in lieu of the clause at FAR 
52.228-7 required by FAR 28.311-1. This is an authorized deviation.



PART 330_COST ACCOUNTING STANDARDS--Table of Contents




                 Subpart 330.2_CAS Program Requirements

Sec.
330.201 Contract requirements.
330.201-5 Waiver.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4247, Jan. 17, 2001, unless otherwise noted.



                 Subpart 330.2_CAS Program Requirements



330.201  Contract requirements.



330.201-5  Waiver.

    (c) The requirements of FAR 30.201-5 shall be exercised by the 
Director, Division of Acquisition Policy (DAP). Requests shall be 
forwarded through normal acquisition channels to the DAP.

[71 FR 76501, Dec. 20, 2006]



PART 332_CONTRACT FINANCING--Table of Contents




         Subpart 332.4_Advance Payments for Non-Commercial Items

Sec.
332.402 General.
332.403 Applicability.
332.407 Interest.
332.409 Contracting officer action.
332.409-1 Recommendation for approval.

             Subpart 332.5_Progress Payments Based on Costs

332.501 General.
332.501-2 Unusual progress payments.

                     Subpart 332.7_Contract Funding

332.702 Policy.
332.703 Contract funding requirements.
332.703-1 General.
332.704 Limitations of cost or funds.
332.705-2 Clauses for limitation of costs or funds.

Subpart 332.9--Prompt Payment [Reserved]

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4247, Jan. 17, 2001, unless otherwise noted.



         Subpart 332.4_Advance Payments for Non-Commercial Items



332.402  General.

    (e) The HCA shall determine whether an advance payment is in the 
public interest in accordance with FAR

[[Page 60]]

32.402(c)(1)(iii)(A). This authority is non delegable.

[71 FR 76501, Dec. 20, 2006]



332.403  Applicability.

    All contracts for research work with educational institutions 
located in the United States shall provide for financing by use of 
advance payments, in reasonable amounts, unless otherwise prohibited by 
law.



332.407  Interest.

    (d) The HCA (not delegable) is authorized to make the determinations 
in FAR 32.407(d) and as follows. Interest-free advance payments may also 
be approved for educational institutions and other nonprofit 
organizations, whether public or private, performing work under 
nonprofit contracts (without fee) involving health services, educational 
programs, or social service programs, such as:
    (1) Community health representative services for an Indian Tribe or 
Band;
    (2) Narcotic addict rehabilitative services;
    (3) Comprehensive health care service program for Model Neighborhood 
programs;
    (4) Planning and development of health maintenance organizations;
    (5) Dissemination of information derived from educational research;
    (6) Surveys or demonstrations in the field of education;
    (7) Producing or distributing educational media for handicapped 
persons including captioned films for the hearing impaired;
    (8) Operation of language or area centers;
    (9) Conduct of biomedical research and support services;
    (10) Research surveys or demonstrations involving the training and 
placement of health manpower and health professionals, and dissemination 
of related information; and
    (11) Surveys or demonstrations in the field of social service.

[66 FR 4247, Jan. 17, 2001, as amended at 71 FR 76501, Dec. 20, 2006]



332.409  Contracting officer action.



332.409-1  Recommendation for approval.

    The information in FAR 32.409-1 (or FAR 32.409-2) shall be 
transmitted to the HCA in the form of a briefing memorandum.



              Subpart 332.5_Progress Payments Based on Cost



332.501  General.



332.501-2  Unusual progress payments.

    (a)(3) The approval of an unusual progress payment shall be made by 
the HCA (not delegable).

[71 FR 76501, Dec. 20, 2006]



                     Subpart 332.7_Contract Funding



332.702  Policy.

    An incrementally funded contract is a multiple year contract in 
which funds are allocated to cover specific phases or increments of 
performance.
    (a) Incremental funding may be used in cost-reimbursement type 
contracts for the acquisition of severable services. It shall not be 
used in contracts for construction or architect-engineer services. 
Incremental funding allows severable cost-reimbursement type contracts 
awarded for more than one year to be funded from succeeding fiscal 
years.
    (b) It is Departmental policy that multiple year contracts be fully 
funded whenever possible. However, incrementally funded contracts may be 
used when:
    (1) A project, which is part of an approved program, is anticipated 
to be of multiple year duration, but funds are not currently available 
to cover the entire project;
    (2) The project represents a valid need for the fiscal year in which 
the contract is awarded and for the succeeding fiscal years of the 
project's duration;
    (3) The project is so significant to the approved program that there 
is reasonable assurance that it will command a high priority for 
proposed appropriations to cover the entire multiple year duration; and

[[Page 61]]

    (4) The statement of work is specific and is defined by separate 
phases or increments so that, at the completion of each, progress can be 
effectively measured.

[71 FR 76501, Dec. 20, 2006]



332.703  Contract funding requirements.



332.703-1  General.

    (b) The following general guidelines are applicable to incrementally 
funded contracts:
    (1) The estimated total cost of the project (all planned phases or 
increments) is to be taken into consideration when determining the 
requirements which must be met before entering into the contract; i.e., 
justification for noncompetitive acquisition, approval of award, etc.
    (2) The RFP and resultant contract are to include a statement of 
work which describes the total project covering the proposed multiple 
year period of performance and indicating timetables consistent with 
planned phases or increments and corresponding allotments of funds.
    (3) Offerors' technical and cost proposals must include the entire 
project and shall show distinct phases or increments and the multiple 
year period of performance.
    (4) Negotiations will be conducted based upon the total project, 
including all planned phases or increments, and the multiple year period 
of performance.
    (5) Sufficient funds must be obligated under the basic contract to 
cover no less than the first year of performance, unless the Contracting 
Officer determines it is advantageous to the Government to fund the 
contract for a lesser period. In that event, the Contracting Officer 
shall ensure that the obligated funds are sufficient to cover a complete 
phase or increment of performance representing a material and measurable 
part of the total project and the period of time that the funds cover 
shall be stated in the contract.
    (6) An incrementally funded contract must contain precise 
requirements for progress reports to be sent to the Project and 
Contracting Officers. These reports will enable the contract to be 
effectively monitored. The Project Officer shall prepare periodic 
performance evaluation reports and provide them to the Contracting 
Officer.

[71 FR 76502, Dec. 20, 2006]



332.704  Limitation of cost or funds.

    See subpart 342.71, ``Administrative Actions for Cost Overruns,'' 
for procedures for handling anticipated cost overruns.

[71 FR 76502, Dec. 20, 2006]



332.705-2  Clauses for limitation of costs or funds.

    (c)(1) When using the Limitation of Funds clause (FAR 52.232-22) in 
the solicitation and resultant incrementally funded contract, the 
contracting officer shall insert the following legend between the clause 
title and the clause text:

(This clause supersedes the Limitation of Cost clause found in the 
General Provisions of this contract.)

    (2) The contracting officer shall also include a clause reading 
substantially as that shown in 352.232-74 in the Special Provisions of 
the resultant incrementally funded contract.
    (3) The request for proposals must inform prospective offerors of 
the Department's intention to enter into an incrementally funded 
contract. Therefore, the contracting officer shall include the provision 
at 352.232-75 in the request for proposals whenever the use of 
incremental funding is contemplated.

Subpart 332.9--Prompt Payment [Reserved]



PART 333_PROTESTS, DISPUTES, AND APPEALS--Table of Contents




                         Subpart 333.1_Protests

Sec.
333.102 General.
333.103 Protests to the agency.
333.104 Protests to GAO.

                   Subpart 333.2_Disputes and Appeals

333.203 Applicability.
333.209 Suspected fraudulent claims.
333.211 Contracting officer's decision.

[[Page 62]]

333.212 Contracting officer's duties upon appeal.
333.212-70 Formats.
333.213 Obligation to continue performance.
333.215-70 Additional contract clause.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4249, Jan. 17, 2001, unless otherwise noted.



                         Subpart 333.1_Protests



333.102  General.

    (g)(1) The Office of Acquisition Management (Division of Acquisition 
Policy (DAP)) has been designated as the headquarters office to serve as 
the liaison for protests lodged with GAO. Within the Division of 
Acquisition Policy (DAP), the Departmental Protest Control Officer 
(DPCO) has been designated as the individual to be contacted by GAO.
    (2) Each contracting activity shall designate a protest control 
officer to serve as an advisor to the contracting officer and to monitor 
protests from the time of initial notification until the protest has 
been resolved. The protest control officer should be a senior 
acquisition specialist in the headquarters acquisition staff office. In 
addition, contracting activities should designate similar officials 
within their principal components to the extent practicable and 
feasible. A copy of each appointment and termination of appointment of 
protest control officers shall be forwarded to the Director, Division of 
Acquisition Policy (DAP).

[66 FR 4249, Jan. 17, 2001, as amended at 71 FR 76502, Dec. 20, 2006]



333.103  Protests to the agency.

    (f)(1) The contracting officer is authorized to make the 
determination, using the criteria in FAR 33.104(b), to award a contract 
notwithstanding the protest after obtaining the concurrence of the 
contracting activity's protest control officer and the Office of General 
Counsel--Business and Administrative Law Division (OGC-BAL). If the 
protest has been lodged with the Secretary, is addressed to the 
Secretary, or requests referral to the Secretary, approval shall also be 
obtained from the Director, Division of Acquisition Policy (DAP) before 
making the award.
    (2) The contracting officer shall require written confirmation of 
any oral protest. To be considered timely, the written confirmation must 
be filed in accordance with the applicable provisions in 333.102(a). In 
the following cases, written protests received by the contracting 
officer before award shall be forwarded, through acquisition channels, 
to the DPCO for processing. Files concerning these protests shall be 
submitted in duplicate, or as otherwise specified by the DPCO and sent 
in the most expeditious manner, marked ``IMMEDIATE ACTION--PROTEST 
BEFORE AWARD'', and contain the documentation referenced in 
333.104(a)(3).
    (i) The protestant requests referral to the Secretary of Health and 
Human Services;
    (ii) The protest is known to have been lodged with the Comptroller 
General or the Secretary, or is addressed to either; or
    (iii) The contracting officer entertains some doubt as to the proper 
action regarding the protest or believes it to be in the best interest 
of the Government that the protest be considered by the Secretary or the 
Comptroller General. Otherwise, protests addressed to the contracting 
officer may be answered by the contracting officer, with the concurrence 
of the contracting activity's protest control officer and OGC-BAL.
    (3) Protests received after award shall be treated as indicated in 
FAR 33.103(f)(3).

[66 FR 4249, Jan. 17, 2001, as amended at 71 FR 76502, Dec. 20, 2006]



333.104  Protests to GAO.

    (a) General procedures. (3)(ii) The DPCO shall process protests 
filed with GAO, whether pre- or post award. Protest files shall be 
prepared by the contracting office and distributed as follows: Two 
copies to the DPCO, one copy to the contracting activity's protest 
control officer, and one copy to OGC-GLD. In addition to the items 
listed in 33.104(a)(3)(ii)(A) through (G), the protest file shall 
include the following documents:
    (H) The current status of award. When award has been made, this 
shall

[[Page 63]]

include whether performance has commenced, shipment or delivery has been 
made, or a stop work order has been issued.
    (I) A copy of any mutual agreement to suspend work on a no-cost 
basis, when appropriate (see FAR 33.104(c)(4)).
    (J) Copies of the notice of protest given offerors and other parties 
when the notice is appropriate (see FAR 33.104(a)(2)).
    (K) A copy of the negotiation memorandum, when applicable.
    (L) The name and telephone number of the person in the contracting 
office who may be contacted for information relevant to the protest.
    (M) A copy of the competitive range memorandum.
    (N) The contracting officer's statement of facts and circumstances, 
including a discussion of the merits of the protest, and conclusions and 
recommendations, including documentary evidence on which they are based. 
The files shall be assembled in an orderly manner and shall have an 
index of enclosures and any document referred to therein.
    (4) The DPCO is responsible for making the necessary distributions 
referenced in FAR 33.104(a)(4).
    (5) The Contracting Officer shall furnish the protest file 
containing the documentation specified in paragraph (a)(3)(ii) of this 
section (with the exception of the contracting officer statement of 
facts and circumstances) and FAR 33.104(a)(3)(ii)(A) through (G) to the 
DPCO within fourteen (14) calendar days from receipt of the protest. The 
contracting officer shall submit the contracting officer's statement of 
facts and circumstances within twenty-one (21) calendar days from 
receipt of the protest. Since the statute allows only a short time 
period in which to respond to protests lodged with GAO, the Contracting 
Officer shall handle each protest on a priority basis. The DPCO shall 
submit copies of the protest file to GAO, the protestor, and any 
intervenors in accordance with FAR 33.104(a)(4)(i).
    (6) Since the DPCO will furnish the protest file to GAO, the 
protestor, and any intervenors, comments on the file from the protestor 
and any intervenors will be sent to the DPCO.
    (7) The DPCO, Division of Acquisition Policy (DAP), shall serve as 
the GAO point of contact for protests lodged with GAO.
    (b) Protests before award. (1) To make an award notwithstanding a 
protest, the Contracting Officer shall prepare a finding using the 
criteria in FAR 33.104(b)(1), have it executed by the HCA (not 
delegable), and forward it, along with a written request for approval to 
make the award, to the Deputy Assistant Secretary for Acquisition 
Management and Policy (DASAMP).
    (2) If the request to make an award notwithstanding the protest is 
approved by the Deputy Assistant Secretary for Acquisition Management 
and Policy (DASAMP), the DPCO shall notify GAO. Whether the request is 
approved or not, the DPCO shall telephonically notify the contracting 
activity's protest control officer of the decision of the Deputy 
Assistant Secretary for Acquisition Management and Policy (DASAMP), and 
the contracting activity's protest control officer shall immediately 
notify the Contracting Officer. The DPCO shall confirm the decision by 
memorandum to the contracting activity's protest control officer.
    (c) Protests after award. (2) If the Contracting Officer believes 
performance should be allowed to continue notwithstanding the protest, a 
finding shall be prepared by the Contracting Officer using the criteria 
in FAR 33.104(c)(2), executed by the HCA (not delegable), and forwarded, 
along with a written request for approval, to the Deputy Assistant 
Secretary for Acquisition Management and Policy (DASAMP). The same 
procedures for notification stated in paragraph (b)(2) of this section 
shall be followed.
    (d) Findings and notice. The written notice required by FAR 
33.104(d) shall be provided to the protestor and any intervenors by the 
DPCO.
    (g) Notice to GAO. The Deputy Assistant Secretary for Acquisition 
Management and Policy (DASAMP) shall be the official to comply with the 
requirements of FAR 33.104(g).

[71 FR 76502, Dec. 20, 2006]

[[Page 64]]



                   Subpart 333.2_Disputes and Appeals



333.203  Applicability.

    (c) The Secretary has designated the Armed Services Board of 
Contract Appeals (ASBCA) as the authorized ``Board'' to hear and 
determine disputes for the Department.

[71 FR 76503, Dec. 20, 2006]



333.209  Suspected fraudulent claims.

    The contracting officer shall submit any instance of a contractor's 
suspected fraudulent claim to the Office of the Inspector General for 
investigation.



333.211  Contracting officer's decision.

    (a)(2) The contracting officer shall refer a proposed final decision 
to the Office of General Counsel-General Law Division (OGC-GLD), for 
advice as to the legal sufficiency and format before sending the final 
decision to the contractor. The contracting officer shall provide OGC-
GLD with the pertinent documents with the submission of each proposed 
final decision.
    (a)(4)(v) When using the paragraph in FAR 33.211 (a)(4)(v), the 
contracting officer shall insert the words ``Armed Services'' before 
each mention of the term ``Board of Contract Appeals''.
    (h) At any time within the period of appeal, the contracting officer 
may modify or withdraw his/her final decision. If an appeal from the 
final decision has been taken to the ASBCA, the contracting officer will 
forward his/her recommended action to OGC-GLD with the supplement to the 
contract file which supports the recommended correction or amendment.

[71 FR 76503, Dec. 20, 2006]



333.212  Contracting officer's duties upon appeal.

    (a) Appeals shall be governed by the rules set forth in the ``Rules 
of the Armed Services Board of Contract Appeals,'' or by the rules 
established by the U.S. Court of Federal Claims, as appropriate.
    (b) The Office of General Counsel-General Law Division (OGC-GLD) is 
designated as the Government Trial Attorney to represent the Government 
in the defense of appeals before the ASBCA. A decision by the ASBCA will 
be transmitted by the Government Trial Attorney to the appropriate 
contracting officer for compliance in accordance with the ASBCA's 
decision.
    (c) If an appeal is filed with the ASBCA, the contracting officer 
shall assemble a file within 30 days of receipt of an appeal, or advice 
that an appeal has been filed, that consists of all documents pertinent 
to the appeal, including:
    (1) The decision and findings of fact from which the appeal is 
taken;
    (2) The contract, including specifications and pertinent 
modifications, plans and drawings;
    (3) All correspondence between the parties pertinent to the appeal, 
including the letter or letters of claim in response to which the 
decision was issued;
    (4) Transcripts of any testimony taken during the course of 
proceedings, and affidavits or statements of any witness on the matter 
in dispute made prior to the filing of the notice of appeal with the 
Board; and
    (5) Any additional information considered pertinent. The contracting 
officer shall furnish the appeal file to the Government Trial Attorney 
for review and approval. After approval, the contracting officer shall 
prepare four copies of the file, one for the ASBCA, one for the 
appellant, one for the Government Trial Attorney, and one for the 
contracting office.
    (d) At all times after the filing of an appeal, the contracting 
officer shall render whatever assistance is requested by the Government 
Trial Attorney. When an appeal is set for hearing, the concerned 
contracting officer shall be responsible for providing Government 
witnesses and specified physical and documentary evidence to the Trial 
Attorney. The Trial Attorney shall ensure the presence of all witnesses 
and documentary evidence at both the pre-hearing conference and hearing.
    (e) If a contractor which has filed an appeal with the ASBCA elects 
to accept fully the decision from which the appeal was taken, or any 
modification to it, and gives written notification of acceptance to the 
Government Trial Attorney or the concerned contracting

[[Page 65]]

officer, the Government Trial Attorney will notify the ASBCA of the 
disposition of the dispute in accordance with Rule 27 of the ASBCA.
    (f) If the contractor has elected to appeal to the U.S. Court of 
Federal Claims, the U.S. Department of Justice will represent the 
Department. However, the contracting officer shall still coordinate all 
actions through OGC-GLD.

[71 FR 76503, Dec. 20, 2006]



333.212-70  Formats.

    (a) The following format is suggested for use in transmitting appeal 
files to the ASBCA:

Your reference:
(Docket No.)
(Name)
Recorder, Armed Services Board of Contract Appeals
Skyline Six 5109 Leesburg Pike
Falls Church, Virginia 22041

Dear (Name):
Transmitted herewith are documents relative to the appeal under Contract 
No. ---- with the ------------
(Name of contractor)
in accordance with the procedures under Rule 4. The Government Trial 
Attorney for this case is
(Insert General Law Division, Office of General Counsel, Department of 
Health and Human Services, 330 Independence Avenue, SW., Washington, DC 
20201).
The request for payment of charges resulting from the processing of this 
appeal should be addressed to:
(Insert name and address of cognizant finance office.)

Sincerely yours,

Contracting Officer
Enclosures

    (b) The following format is suggested for use in notifying the 
appellant that the appeal file was submitted to the ASBCA:

(Contractor Address)
________________________________________________________________________

________________________________________________________________________

Dear ------:
    An appeal file has been compiled relative to the appeal under 
Contract No. ------, and has been submitted to the Armed Services Board 
of Contract Appeals (ASBCA). The enclosed duplicate of the appeal file 
is identical to that submitted to the Board, except that contract 
documents which you already have been excluded. You may furnish or 
suggest any additional information deemed pertinent to the appeal to the 
Armed Services Board of Contract Appeals according to their rules.
    The ASBCA will provide you with further information concerning this 
appeal.
Sincerely yours,

Contracting Officer
Enclosure

[66 FR 4249, Jan. 17, 2001, as amended at 71 FR 76503, Dec. 20, 2006]



333.213  Obligation to continue performance.

    (a) The Disputes clause at FAR 52.233-1 shall be used without the 
use of Alternate I. However, if the contracting officer determines that 
the Government's interest would be better served by use of paragraph (i) 
in Alternate I, he/she must request approval for its use from the chief 
of the contracting office.



333.215-70  Additional contract clause.

    Use the clause at 352.333-7001, Choice of Law (Overseas), in 
solicitations and contracts when contract performance will be outside 
the United States, its possessions, and Puerto Rico, except as otherwise 
provided for in a government-to-government agreement.

[70 FR 40, Jan. 3, 2005]

[[Page 66]]



             SUBCHAPTER F_SPECIAL CATEGORIES OF CONTRACTING





PART 335_RESEARCH AND DEVELOPMENT CONTRACTING--Table of Contents




Sec.
335.070 Cost-sharing.
335.070-1 Policy.
335.070-2 Amount of cost-sharing.
335.070-3 Method of cost-sharing.
335.070-4 Contract award.
335.071 Special determinations and findings affecting research and 
          development contracting.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4251, Jan. 17, 2001, unless otherwise noted.



335.070  Cost-sharing.



335.070-1  Policy.

    (a) The use of cost-sharing type contracts should be encouraged to 
contribute to the cost of performing research where there is a 
probability that the contractor will receive present or future benefits 
from participation, such as, increased technical know-how, training to 
employees, acquisition of equipment, use of background knowledge in 
future contracts, etc. Cost-sharing is intended to serve the mutual 
interests of the Government and the performing organization by helping 
to assure efficient utilization of the resources available for the 
conduct of research projects and by promoting sound planning and prudent 
fiscal policies by the performing organization. Encouragement should be 
given to organizations to contribute to the cost of performing research 
under contracts unless the contracting officer determines that a request 
for cost-sharing would not be appropriate because of the following 
circumstances:
    (1) The particular research objective or scope of effort for the 
project is specified by the Government rather than proposed by the 
performing organization. This would usually include any formal 
Government request for proposals for a specific project.
    (2) The research effort has only minor relevance to the non-Federal 
activities of the performing organization, and the organization is 
proposing to undertake the research primarily as a service to the 
Government.
    (3) The organization has little or no non-Federal sources or funds 
from which to make a cost contribution. Cost-sharing should generally 
not be requested if cost-sharing would require the Government to provide 
funds through some other means (such as fees) to enable the organization 
to cost-share. It should be recognized that those organizations which 
are predominantly engaged in research and development and have little or 
no production or other service activities may not be in a favorable 
position to make a cost contribution.
    (b) The responsibility for negotiating cost-sharing is that of the 
contracting office. Each research contract file should show whether the 
contracting officer considered cost-sharing appropriate for that 
particular contract and in what amount. If cost-sharing was not 
considered appropriate, the file must indicate the factual basis for 
that decision, e.g., ``Because the contractor will derive no benefits 
from this award that can be applied to its commercial activities, cost-
sharing is not considered appropriate.'' The contracting officer may 
wish to coordinate with the project officer before documenting this 
decision.
    (c) If the contracting officer considers cost-sharing to be 
appropriate for a research contract and the contractor refuses to accept 
this type of contract, the award may be made without cost-sharing, if 
the contracting officer concludes that payment of the full cost of the 
research effort is necessary in order to obtain the services of that 
particular contractor.



335.070-2  Amount of cost-sharing.

    When cost-sharing is appropriate, use the following guidelines to 
determine the amount of cost participation by the contractor:
    (a) The amount of cost participation should depend on the extent to 
which the research effort or results are likely

[[Page 67]]

to enhance the performing organization's capability, expertise, or 
competitive position, and the value of this enhancement to the 
performing organization. It should be recognized that those 
organizations which are predominantly engaged in research and 
development have little or no production or other service activities and 
may not be in a favorable position to derive a monetary benefit from 
their research under Federal agreements. Therefore, contractor cost 
participation could reasonably range from as little as 1 percent or less 
of the total project cost, to more than 50 percent of the total project 
cost. Ultimately, the Contracting Officer should bear in mind that cost-
sharing is a negotiable item. As such, the amount of cost-sharing should 
be proportional to the anticipated value of the contractor's gain.
    (b) If the performing organization will not acquire title or the 
right to use inventions, patents, or technical information resulting 
from the research project, it would generally be appropriate to obtain 
less cost-sharing than in cases in which the performer acquires these 
rights.
    (c) A fee or profit will usually not be paid to the performing 
organization if the organization is to contribute to the cost of the 
research effort, but the amount of cost-sharing may be reduced to 
reflect the fact that the organization is foregoing its normal fee or 
profit in the research. However, if the research is expected to be of 
only minor value to the performing organization and if cost-sharing is 
not required by statute, it may be appropriate for the performer to make 
a contribution in the form of a reduced fee or profit rather than 
sharing costs of the project.
    (d) The organization's participation may be considered over the 
total term of the project so that a relatively high contribution in one 
year may be offset by a relatively low contribution in another.
    (e) A relatively low degree of cost-sharing may be appropriate if, 
in the view of the operating divisions or their subordinate elements, an 
area of research requires special stimulus in the national interest.

[66 FR 4251, Jan. 17, 2001, as amended at 71 FR 76504, Dec. 20, 2006]



335.070-3  Method of cost-sharing.

    Cost-sharing on individual contracts may be accomplished either by a 
contribution of part or all of one or more elements of allowable cost of 
the work being performed, or by a fixed amount or stated percentage of 
the total allowable costs of the project. Costs so contributed may not 
be charged to the Government under any other grant or contract 
(including allocations to other grants or contracts as part of any 
independent research and development program).



335.070-4  Contract award.

    In consonance with the Department's objectives of competition and 
support of the small business program, award of contracts should not be 
made solely on the basis of ability or willingness to cost-share. Awards 
should be made primarily on the contractor's competence and only after 
adequate competition has been obtained among large and small business 
organizations whenever possible. The offeror's willingness to share 
costs should not be considered in the technical evaluation process but 
as a business consideration, which is secondary to selecting the best 
qualified source.



335.071  Special determinations and findings affecting research and development contracting.

    OPDIV heads for health agencies shall sign individual and class 
determinations and findings for:
    (a) Acquisition or construction of equipment or facilities on 
property not owned by the United States pursuant to 42 U.S.C. 241(a)(7); 
and
    (b) Use of an indemnification provision in a research contract 
pursuant to 42 U.S.C. 241(a)(7).



PART 339_ACQUISITION OF INFORMATION TECHNOLOGY--Table of Contents




Sec.
339.201-10 Clarification.
339.201-70 Required provision and contract clause.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 71 FR 76504, Dec. 20, 2006, unless otherwise noted.

[[Page 68]]



339.201-10  Clarification.

    FAR Subpart 39.2, Electronic and Information Technology, requires 
Federal agencies to ensure that, when acquiring EIT, Federal employees 
with disabilities and members of the public with disabilities have 
access to and use of information and data that is comparable to 
individuals without disabilities. This EIT access requirement does not 
apply to a contractor's internal workplaces. EIT that is not used nor 
accessed by Federal employees or members of the public is not subject to 
the Architectural and Transportation Barriers Compliance Board (Access 
Board) standards. Contractors in their professional capacity are not 
members of the public for purposes of Section 508.



339.201-70  Required provision and contract clause.

    When acquiring EIT, the Contracting Officer shall insert the 
provision at 352.270-19(a) in solicitations and the clause in 352.270-
19(b) in contracts and orders for projects that will develop, purchase, 
maintain, or use electronic and information technology (EIT), unless 
these EIT products and/or services are incidental to the project. (Note: 
Other exceptions to this requirement can be found at FAR 39.204.)

[[Page 69]]



                    SUBCHAPTER G_CONTRACT MANAGEMENT





PART 342_CONTRACT ADMINISTRATION--Table of Contents




                    Subpart 342.7_Indirect Cost Rates

Sec.
342.705 Final indirect cost rates.

                   Subpart 342.70_Contract Monitoring

342.7001 Purpose.
342.7002 Contract monitoring responsibilities.
342.7003 Withholding of contract payments.
342.7003-1 Policy.
342.7003-2 Procedures.
342.7003-3 Withholding payments.

         Subpart 342.71_Administrative Actions for Cost Overruns

342.7100 Scope of subpart.
342.7101 Contract administration.
342.7101-1 General.
342.7101-2 Procedures.
342.7102 Contract modifications.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4252, Jan. 17, 2001, unless otherwise noted.



                    Subpart 342.7_Indirect Cost Rates



342.705  Final indirect cost rates.

    (a) The Director, Division of Cost Allocation of the Program Support 
Center, within each servicing HHS regional office, has been delegated 
the authority to establish indirect cost rates, research patient care 
rates, and, as necessary, fringe benefit, computer, and other special 
costing rates for use in contracts and grants awarded to State and local 
governments, colleges and universities, hospitals, and other nonprofit 
organizations.
    (b) The Division of Financial Advisory Services of the National 
Institutes of Health has the authority to establish indirect cost rates, 
fringe benefit rates, etc., for use in contracts and grants awarded to 
commercial organizations.

[71 FR 76504, Dec. 20, 2006]



                   Subpart 342.70_Contract Monitoring



342.7001  Purpose.

    Contract monitoring is an essential element of contract 
administration and is performed jointly by the Project Officer and the 
Contracting Officer. This subpart describes the Department's operating 
concepts.

[71 FR 76504, Dec. 20, 2006]



342.7002  Contract monitoring responsibilities.

    (a) The contract establishes the obligations of both the Government 
and the contractor. The Contracting Officer is the only person 
authorized to make changes to the contract. The Contracting Officer must 
confirm all changes in writing.
    (b) The Contracting Officer is responsible for assuring compliance 
with all the terms and conditions of the contract. The Contracting 
Officer shall inform the contractor by letter (if not already stipulated 
in the contract) of the authorities and responsibilities of the 
Government personnel involved with the contract.
    (c) The Contracting Officer must depend on program, technical, and 
other personnel for assistance and advice in monitoring the contractor's 
performance, and in other areas of postaward administration. The 
Contracting Officer must assure that these individuals understand and 
carry out their assigned responsibilities. The individual roles and 
corresponding responsibilities typically involve, but are not limited 
to, the following:
    (1) The role of program and technical personnel in monitoring the 
contract is to assist and/or advise the Contracting Officer or act as 
his/her representative when so designated by the Contracting Officer. 
Activities may include:
    (i) Providing technical monitoring during contract performance, and 
issuing letters to the contractor and Contracting Officer relating to 
delivery, acceptance, or rejection in accordance with the terms of the 
contract;

[[Page 70]]

    (ii) Assessing contractor performance, including inspection and 
testing of products and evaluation of reports and data;
    (iii) Recommending necessary changes to the schedule of work and 
period of performance in order to accomplish the objectives of the 
contract. Program officials must provide the Contracting Officer a 
written request along with an appropriate justification and a funding 
document if additional funds are needed;
    (iv) Reviewing invoices/vouchers and recommending approval/
disapproval action by the Contracting Officer, to include comments 
regarding anything unusual discovered in the review;
    (v) Reviewing and recommending approval or disapproval of 
subcontractors, overtime, travel, and key personnel changes; and
    (vi) Participating, as necessary, in various phases of the contract 
closeout process.
    (2) The role of the Project Officer in monitoring the contract 
includes the applicable activities set forth in paragraph (c)(1) of this 
section. The Project Officer also shall do the following:
    (i) Submit periodic reports to the Contracting Officer that 
concisely explain the status of the contract, and include recommended 
actions for any problems reported. Provide the Contracting Officer with 
written notification of evaluation and approval/disapproval of contract 
deliverables and of completion of tasks or phases. The Contracting 
Officer or designee will provide the contractor with written 
notification of approval or disapproval and include a copy in the 
contract file;
    (ii) Monitor the technical aspects of the contract, identify 
existing and potential problems that threaten performance, and 
immediately inform the Contracting Officer of deviations from contract 
objectives or from any technical or delivery requirements;
    (iii) Immediately notify the head of the program office whenever it 
is determined that objectives are not being met and provide specific 
recommendations of actions to be taken. The Contracting Officer shall 
receive a copy of the Project Officer's report and recommendations;
    (iv) Within 120 days after contract completion, submit a final 
written assessment report to the Contracting Officer. The report should 
include analysis of the contractor's performance, including the contract 
and program objectives achieved and missed. A copy of the final 
assessment report shall be forwarded to the head of the program office 
responsible for the program for management review and follow-up, as 
necessary; and
    (v) Accompany and/or provide, when requested, technical support to 
the HHS auditor in the conduct of visual inspections.
    (3) The roles of the contract administrator, auditor, cost analyst, 
and property administrator are to assist and/or advise the Contracting 
Officer in postaward administration activities such as:
    (i) Evaluation of contractor systems and procedures, to include 
accounting policies and procedures, purchasing policies and practices, 
property accounting and control, wage and salary plans and rate 
structures, personnel policies and practices, etc.;
    (ii) Processing of disputes under the Disputes clause and any 
resultant appeals;
    (iii) Modification or termination of the contract; and
    (iv) Determination of the allowability of cost charges to incentive 
or cost-reimbursement type contracts and progress payments under fixed-
price contracts. This is especially important when award is made to new 
organizations or those with financial weaknesses.
    (d) The Contracting Officer is responsible for assuring that 
contractor performance and contract monitoring conform with contract 
terms. If performance is not satisfactory or if problems are 
anticipated, it is essential that the Contracting Officer take immediate 
action to protect the Government's rights under the contract. The 
Contracting Officer shall notify his/her immediate supervisor of 
problems that cannot be resolved within contract limitations and 
whenever contract or program objectives are not met. The notification 
shall include a statement of

[[Page 71]]

action being taken by the Contracting Officer.

[71 FR 76504, Dec. 20, 2006]



342.7003  Withholding of contract payments.



342.7003-1  Policy.

    (a) All solicitations and resultant contracts (other than awards 
made using simplified acquisition procedures) shall contain the 
withholding of contract payments clause at 352.232-9, and an excusable 
delays clause, or a clause which incorporates the definition of 
excusable delays. Use the excusable delays clause at 352.249-14 when the 
solicitation and resultant contract (other than purchase orders) does 
not contain a default or other excusable delays clause.
    (b) When appropriate, the Contracting Officer may withhold any 
contract payment when a required report is overdue, or the contractor 
fails to perform or deliver required work or services.

[71 FR 76505, Dec. 20, 2006]



342.7003-2  Procedures.

    (a) The Contracting Officer is responsible for initiating immediate 
action to protect the Government's rights whenever the contractor fails 
to comply with either the delivery or reporting terms of the contract. 
Compliance with the reporting terms includes those reports to be 
submitted directly to the payment office. The payment office shall 
notify the Contracting Officer promptly when such a report is not 
submitted on time.
    (b) When the contract contains a termination for default clause, the 
contractor's failure to submit any report, perform services, or deliver 
work when required by the contract is considered a default in 
performance. The Contracting Officer shall immediately issue a formal 
ten-day cure notice pursuant to FAR 49.607. The notice shall include a 
statement to the effect that payments will be withheld if the default is 
not cured within the time frame specified in the notice or if the 
default is not determined to be excusable.
    (1) If the default is cured or is determined to be excusable, the 
Contracting Officer shall not initiate the withholding action.
    (2) If the default is not determined to be excusable or a response 
is not received within the allotted time, the Contracting Officer shall 
initiate withholding action on all contract payments and shall determine 
whether termination for default or other action would be in the best 
interest of the Government.
    (c) When the contract does not contain a termination for default 
clause, the contractor's failure to submit any required report, perform 
services, or deliver work when required by the contract shall be 
considered a failure to perform. The Contracting Officer shall 
immediately issue a written notice to the contractor specifying the 
failure and providing a ten-day period (or longer period if the 
Contracting Officer deems it necessary) in which the contractor shall 
cure the failure or provide reasons for an excusable delay. The notice 
shall include a statement to the effect that payments will be withheld 
if the default is not cured within the time specified in the notice or 
if the default is not determined to be excusable.
    (1) If the failure is cured or is determined to be excusable, the 
Contracting Officer shall not initiate the withholding action.
    (2) If the failure is not determined to be excusable or a response 
is not received within the allotted time, the Contracting Officer shall 
initiate withholding action on all contract payments and shall determine 
whether termination for convenience or other action would be in the best 
interest of the Government.
    (d) The Contracting Officer should consult FAR subpart 49.4 for 
further guidance before taking any of the actions described in this 
section.

[71 FR 76505, Dec. 20, 2006]



342.7003-3  Withholding payments.

    (a) When making the determination that contract payments should be 
withheld in accordance with the Withholding of Contract Payments clause,

[[Page 72]]

the Contracting Officer shall immediately notify the servicing finance 
office in writing of the determination to withhold payments. The notice 
of suspension shall contain all information necessary for the finance 
office to identify the contract, i.e., contract number, task/delivery 
order number, contractor name and address, etc.
    (b) The Contracting Officer shall immediately notify the contractor 
in writing that payments have been suspended until the default or 
failure is cured.
    (c) When the contractor cures the default or failure, the 
Contracting Officer shall immediately notify, in writing, all recipients 
of the notice of suspension that the suspension is to be lifted and 
contract payments are to be resumed.
    (d) When exercising actions regarding the withholding of payment 
procedures, the Contracting Officer must be careful not to waive any of 
the Government's rights when corresponding with the contractor or when 
taking any other actions.

[71 FR 76505, Dec. 20, 2006]



         Subpart 342.71_Administrative Actions for Cost Overruns



342.7100  Scope of subpart.

    This subpart sets forth the procedures to follow when a cost overrun 
is anticipated. A cost overrun occurs when the allowable actual cost of 
performing a cost-reimbursement type contract exceeds the total 
estimated cost specified in the contract.

[71 FR 76506, Dec. 20, 2006]



342.7101  Contract administration.



342.7101-1  General.

    Upon receipt of information that a contractor's accumulated cost and 
projected expenditures will exceed the limit of funds obligated by the 
contract, the contracting officer shall coordinate immediately with the 
appropriate program office to determine whether the contract should be 
modified or terminated. If the contracting officer receives information 
from a source other than the contractor that a cost overrun is 
anticipated, the contracting officer shall verify the information with 
the contractor, and remind the contractor of the notification 
requirements of the Limitation of Cost clause.



342.7101-2  Procedures.

    (a) Upon notification that a cost overrun is anticipated, the 
Contracting Officer shall inform the contractor to submit a request for 
additional funds which shall include:
    (1) Name and address of contractor.
    (2) Contract number and expiration date.
    (3) Contract item(s) and amount(s) creating overrun.
    (4) The elements of cost which changed from the original estimate 
(i.e., labor, material, travel, overhead, etc.) to be furnished in the 
following format:
    (i) Original estimate,
    (ii) Costs incurred to date,
    (iii) Estimated cost to completion,
    (iv) Revised estimate, and
    (v) Amount of adjustment.
    (5) The factors responsible for the increase, i.e., error in 
estimate, changed conditions, etc.
    (6) The latest date by which funds must be available for commitment 
to avoid contract slippage, work stoppage, or other program impairment.
    (b) When the contractor submits a notice of an impending overrun, 
the contracting officer shall:
    (1) Immediately advise the appropriate program office and furnish a 
copy of the notice and any other data received;
    (2) Request audit or cost advisory services, and technical support, 
as necessary, for evaluation of information and data received; and
    (3) Maintain continuous follow-up with the program office to obtain 
a timely decision as to whether the work under the contract should 
continue and additional funds be provided, or the contract terminated. 
An appropriate written statement and funding authority, or a formal 
request for termination, must support the decision of the program 
office. After receiving the decision by the program office, the 
Contracting Officer shall promptly notify the contractor in writing of 
the following:

[[Page 73]]

    (i) The specified amount of additional funds allotted to the 
contract; or
    (ii) Work will be discontinued when the allotted funds are 
exhausted, and any work performed after that date is at the contractor's 
risk; or
    (iii) The Government is considering whether to allot additional 
funds to the contract and will notify the contractor as soon as 
possible, but that any work performed after the currently allotted funds 
are exhausted is at the contractor's risk. Timely, formal notification 
of the Government's intention is essential in order to preclude loss of 
contractual rights in the event of dispute, termination, or litigation.
    (c) If program requirements permit, contracting officers should 
refrain from issuing any contractual documents which will require new 
work or an extension of time, pending resolution of an overrun or 
additional fund request.

[66 FR 4252, Jan. 17, 2001, as amended at 71 FR 76506, Dec. 20, 2006]



342.7102  Contract modifications.

    (a) Modifications to contracts containing the Limitation of Cost 
clause shall include either:
    (1) A provision increasing the estimated or ceiling amount referred 
to in the Limitation of Cost clause of the contract and stating that the 
clause will thereafter apply in respect to the increased amount; or
    (2) A provision stating that the estimated or ceiling amount 
referred to in the contract is not changed by the modification and that 
the Limitation of Cost clause will continue to apply with respect to the 
amount in effect prior to the modification.
    (b) A fixed-fee provided in a contract shall not be changed when 
funding a cost overrun. Changes in fixed-fee will be made only to 
reflect changes in the scope of work which justify an increase or 
decrease in fee.

[[Page 74]]



                     SUBCHAPTER H_CLAUSES AND FORMS





PART 352_SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




              Subpart 352.2_Texts of Provisions and Clauses

Sec.
352.202-1 Definitions.
352.215-1 Instructions to offerors--Competitive acquisition.
352.215-70 Late proposals and revisions.
352.216-72 Additional cost principles.
352.223-70 Safety and health.
352.224-70 Confidentiality of information.
352.228-7 Insurance--Liability to third persons.
352.232-9 Withholding of contract payments.
352.232-75 Incremental funding.
352.233-70 Litigation and claims.
352.242-71 Final decisions on audit findings.
352.249-14 Excusable delays.
352.270-1 Accessibility of meetings, conferences, and seminars to 
          persons with disabilities.
352.270-2 Indian preference.
352.270-3 Indian preference program.
352.270-4 Pricing of adjustments.
352.270-5 Key personnel.
352.270-6 Publications and publicity.
352.270-7 Paperwork Reduction Act.
352.270-8 Protection of human subjects.
352.270-9 Care of laboratory animals.
352.270-10 Anti-lobbying.
352.270-11 Privacy Act.
352.270-12 Pro-Children Act.
352.270-13 Tobacco-free facilities.
352.270-14 Restriction on use of human subjects.
352.270-15 Salary rate limitation.
352.270-16 Native American Graves Protection and Repatriation Act.
352.270-17 Crime Control Act--Reporting of child abuse.
352.270-18 Crime Control Act--Requirement for background checks.
352.270-19 Electronic information and technology accessibility.
352.333-7001 Choice of Law (Overseas).

    Authority: 5 U.S.C. 301, 40 U.S.C. 486(c).

    Source: 66 FR 4255, Jan. 17, 2001, unless otherwise noted.



              Subpart 352.2_Texts of Provisions and Clauses



352.202-1  Definitions.

    As prescribed in 302.201, use the FAR Definitions clause at 52.202-1 
as modified:

                         Definitions (JAN 2006)

    (a) In accordance with 52.202-1(a)(1), substitute the following as 
paragraph (a):
    ``(a) The term ``Secretary'' or ``Head of the Agency'' (also called 
``Agency Head'') means the Secretary, Deputy Secretary, or any Assistant 
Secretary, Administrator or Commissioner of the Department of Health and 
Human Services; and the term ``his/her duly authorized representative'' 
means any person, persons, or board authorized to act for the 
Secretary.''
    (b) In accordance with 52.202-1(a)(1), add the following paragraph 
(h):
    ``(h) The term ``Project Officer'' means the person who monitors the 
technical aspects of contract performance. The Project Officer is not 
authorized to issue any instructions or directions which cause any 
increase or decrease in the scope of work which would result in the 
increase or decrease in the price of this contract, or changes in the 
delivery schedule or period of performance of this contract. If 
applicable, the Project Officer is not authorized to receive or act upon 
any notification or revised cost estimate provided by the Contractor in 
accordance with the Limitation of Cost or Limitation of Funds clauses of 
this contract.''

[71 FR 76506, Dec. 20, 2006]



352.215-1  Instructions to offerors--Competitive acquisition.

    Insert the following paragraph (e) in place of paragraph (e) of the 
provision at FAR 52.215-1:

    (e) Restriction on disclosure and use of data. (1) The proposal 
submitted in response to this request may contain data (trade secrets; 
business data, e.g., commercial information, financial information, and 
cost and pricing data; and technical data) which the offeror, including 
its prospective subcontractor(s), does not want used or disclosed for 
any purpose other than for evaluation of the proposal. The use and 
disclosure of any data may be so restricted; provided, that the 
Government determines that the data is not required to be disclosed 
under the Freedom of Information Act, 5 U.S.C. 552, as amended, and the 
offeror marks the cover sheet of the proposal with the following 
statements, specifying the particular portions of the proposal which are 
to be restricted: ``Unless disclosure is required by the Freedom of 
Information Act, 5 U.S.C. 552, as amended, (the Act) as determined by 
Freedom of Information (FOI) officials of the Department of Health and 
Human Services, data contained in the portions of this proposal which 
have been specifically identified by page number,

[[Page 75]]

paragraph, etc. by the offeror as containing restricted information 
shall not be used or disclosed except for evaluation purposes.
    The offeror acknowledges that the Department may not be able to 
withhold a record (data, document, etc.) nor deny access to a record 
requested pursuant to the Act and that the Department's FOI officials 
must make that determination. The offeror hereby agrees that the 
Government is not liable for disclosure if the Department has determined 
that disclosure is required by the Act.
    If a contract is awarded to the offeror as a result of, or in 
connection with, the submission of this proposal, the Government shall 
have the right to use or disclose the data to the extent provided in the 
contract. Proposals not resulting in a contract remain subject to the 
Act.
    The offeror also agrees that the Government is not liable for 
disclosure or use of unmarked data and may use or disclose the data for 
any purpose, including the release of the information pursuant to 
requests under the Act. The data subject to this restriction are 
contained in pages (insert page numbers, paragraph designations, etc. or 
other identification).''
    (2) In addition, the offeror must mark each page of data it wishes 
to restrict with the following statement:
    ``Use or disclosure of data contained on this page is subject to the 
restriction on the cover sheet of this proposal or quotation.''
    (3) Offerors are cautioned that proposals submitted with restrictive 
statements or statements differing in substance from those cited above 
may not be considered for award. The Government reserves the right to 
reject any proposal submitted with nonconforming statement(s).

[71 FR 76506, Dec. 20, 2006]



352.215-70  Late proposals and revisions.

    As prescribed in 315.208, the following provision may be included in 
the solicitation:

                 Late Proposals and Revisions (JAN 2006)

    Notwithstanding the procedures contained in FAR 52.215-1(c)(3) of 
the provision of this solicitation entitled Instructions to Offerors--
Competitive Acquisition, a proposal received after the date specified 
for receipt may be considered if it appears to offer the best value to 
the Government and it was received before proposals were distributed for 
evaluation, or within five calendar days after the exact time specified 
for receipt, whichever is earlier.

                           (End of provision)

[71 FR 76506, Dec. 20, 2006]



352.216-72  Additional cost principles.

    As prescribed in 316.307(j), insert the following clause in all 
solicitations and resultant cost-reimbursement contracts:

                  Additional Cost Principles (JAN 2006)

    (a) Bid and proposal costs. (1) Bid and proposal costs are the 
immediate costs of preparing bids, proposals, and applications for 
potential Federal and non-Federal contracts, grants, and agreements, 
including the development of scientific, cost, and other data needed to 
support the bids, proposals, and applications.
    (2) Bid and proposal costs of the current accounting period are 
allowable as indirect costs.
    (3) Bid and proposal costs of past accounting periods are 
unallowable in the current period. However, if the organization's 
established practice is to treat these costs by some other method, they 
may be accepted if they are found to be reasonable and equitable.
    (4) Bid and proposal costs do not include independent research and 
development costs covered by the following paragraph, or preaward costs 
covered by paragraph 36 of Attachment B to OMB Circular A-122.
    (b) Independent research and development costs. (1) Independent 
research and development is research and development conducted by an 
organization which is not sponsored by Federal or non-Federal contracts, 
grants, or other agreements.
    (2) Independent research and development shall be allocated its 
proportionate share of indirect costs on the same basis as the 
allocation of indirect costs to sponsored research and development.
    (3) The cost of independent research and development, including its 
proportionate share of indirect costs, are unallowable.

                             (End of clause)

[66 FR 4255, Jan. 17, 2001, as amended at 71 FR 76506, Dec. 20, 2006]



352.223-70  Safety and health.

    The following clause shall be used as prescribed in 323.7002:

                      Safety and Health (JAN 2006)

    (a) To help ensure the protection of the life and health of all 
persons, and to help prevent damage to property, the Contractor shall 
comply with all Federal, State and local laws and regulations applicable 
to the work being performed under this contract. These laws are 
implemented and/or enforced by the Environmental Protection Agency, 
Occupational Safety and Health Administration and

[[Page 76]]

other agencies at the Federal, State and local levels (Federal, State 
and local regulatory/enforcement agencies).
    (1) In addition, the following regulations must be followed when 
developing and implementing health and safety operating procedures and 
practices for both personnel and facilities involving the use or 
handling of hazardous materials and the conduct of research, 
development, or test projects:
    (i) 29 CFR 1910.1030, Bloodborne pathogens; 29 CFR 1910.1450, 
Occupational exposure to hazardous chemicals in laboratories; and other 
applicable occupational health and safety standards issued by the 
Occupational Health and Safety Administration (OSHA) and included in 29 
CFR Part 1910. These regulations are available at http://www.osha.gov/
comp-links.html.
    (ii) Nuclear Regulatory Commission Standards and Regulations, 
pursuant to the Energy Reorganization Act of 1974 (42 U.S.C. 5801 et 
seq.). Copies may be obtained from the U.S. Nuclear Regulatory 
Commission, Washington, DC 20555-0001.
    (2) The following guidelines are recommended for use in developing 
and implementing health and safety operating procedures and practices 
for both personnel and facilities:
    (i) Biosafety in Microbiological and Biomedical Laboratories, CDC 
and NIH, HHS. This publication is available at http://bmbl.od.nih.gov/
index.htm.
    (ii) Prudent Practices for Safety in Laboratories (1995), National 
Research Council, National Academy Press, 500 Fifth Street, NW., Lockbox 
285, Washington, DC 20055 (ISBN 0-309-05229-7). This publication can be 
obtained by telephoning 800-624-8373. It also is available at http://
www.nap.edu/catalog/4911.html.
    (b) Further, the Contractor shall take or cause to be taken 
additional safety measures as the Contracting Officer, in conjunction 
with the project or other appropriate officers, determines to be 
reasonably necessary. If compliance with these additional safety 
measures results in an increase or decrease in the cost or time required 
for performance of any part of work under this contract, an equitable 
adjustment will be made in accordance with the applicable ``Changes'' 
clause set forth in this contract.
    (c) The Contractor shall maintain an accurate record of, and 
promptly report to the Contracting Officer, all accidents or incidents 
resulting in the exposure of persons to toxic substances, hazardous 
materials or hazardous operations; the injury or death of any person; 
and/or damage to property incidental to work performed under the 
contract and all violations for which the Contractor has been cited by 
any Federal, State or local regulatory/enforcement agency. The report 
shall include a copy of the notice of violation and the findings of any 
inquiry or inspection, and an analysis addressing the impact these 
violations may have on the work remaining to be performed. The report 
shall also state the required action(s), if any, to be taken to correct 
any violation(s) noted by the Federal, State or local regulatory/
enforcement agency and the time frame allowed by the agency to 
accomplish the necessary corrective action.
    (d) If the Contractor fails or refuses to comply with the Federal, 
State or local regulatory/enforcement agency's directive(s) regarding 
any violation(s) and prescribed corrective action(s), the Contracting 
Officer may issue an order stopping all or part of the work until 
satisfactory corrective action (as approved by the Federal, State or 
local regulatory/enforcement agencies) has been taken and documented to 
the Contracting Officer. No part of the time lost due to any stop work 
order shall be subject to a claim for extension of time or costs or 
damages by the Contractor.
    (e) The Contractor shall insert the substance of this clause in each 
subcontract involving toxic substances, hazardous materials, or 
hazardous operations. Compliance with the provisions of this clause by 
subcontractors will be the responsibility of the Contractor.

                             (End of clause)

[71 FR 76507, Dec. 20, 2006]



352.224-70  Confidentiality of information.

    The following clause covers the policy set forth in subpart 324.70 
and is used in accordance with the instructions set forth in 324.7004.

                Confidentiality of Information (JAN 2006)

    (a) Confidential information, as used in this clause, means 
information or data of a personal nature about an individual, or 
proprietary information or data submitted by or pertaining to an 
institution or organization.
    (b) The Contracting Officer and the Contractor may, by mutual 
consent, identify elsewhere in this contract specific information and/or 
categories of information which the Government will furnish to the 
Contractor or that the Contractor is expected to generate which is 
confidential. Similarly, the Contracting Officer and the Contractor may, 
by mutual consent, identify such confidential information from time to 
time during the performance of the contract. Failure to agree will be 
settled pursuant to the ``Disputes'' clause.
    (c) If it is established elsewhere in this contract that information 
to be utilized under this contract, or a portion thereof, is subject to 
the Privacy Act, the Contractor

[[Page 77]]

will follow the rules and procedures of disclosure set forth in the 
Privacy Act of 1974, 5 U.S.C. 552a, and implementing regulations and 
policies, with respect to systems of records determined to be subject to 
the Privacy Act.
    (d) Confidential information, as defined in paragraph (a) of this 
clause, shall not be disclosed without the prior written consent of the 
individual, institution, or organization.
    (e) Whenever the Contractor is uncertain with regard to the proper 
handling of material under the contract, or if the material in question 
is subject to the Privacy Act or is confidential information subject to 
the provisions of this clause, the Contractor should obtain a written 
determination from the Contracting Officer prior to any release, 
disclosure, dissemination, or publication.
    (f) Contracting Officer determinations will reflect the result of 
internal coordination with appropriate program and legal officials.
    (g) The provisions of paragraph (d) of this clause shall not apply 
to conflicting or overlapping provisions in other Federal, State, or 
local laws.

                             (End of clause)

[71 FR 76507, Dec. 20, 2006]



352.228-7  Insurance--Liability to third persons.

    As prescribed in 328.311-2, contracting officers shall include the 
following clause in all cost-reimbursement contracts, in lieu of the 
clause at FAR 52.228-7:

            Insurance--Liability to Third Persons (DEC 1991)

    (a)(1) Except as provided in paragraph (a)(2) immediately following, 
or in paragraph (h) of this clause (if the clause has a paragraph (h)), 
the Contractor shall provide and maintain workers' compensation, 
employer's liability, comprehensive general liability (bodily injury), 
comprehensive automobile liability (bodily injury and property damage) 
insurance, and such other insurance as the Contracting Officer may 
require under this contract.
    (2) The Contractor may, with the approval of the Contracting 
Officer, maintain a self-insurance program; provided that, with respect 
to workers' compensation, the Contractor is qualified pursuant to 
statutory authority.
    (3) All insurance required by this paragraph shall be in form and 
amount and for those periods as the Contracting Officer may require or 
approve and with insurers approved by the Contracting Officer.
    (b) The Contractor agrees to submit for the Contracting Officer's 
approval, to the extent and in the manner required by the Contracting 
Officer, any other insurance that is maintained by the Contractor in 
connection with performance of this contract and for which the 
Contractor seeks reimbursement.
    (c) Except as provided in paragraph (h) of this clause (if the 
clause has a paragraph (h)), the Contractor shall be reimbursed:
    (1) For that portion of the reasonable cost of insurance allocable 
to this contract, and required or approved under this clause; and
    (2) For certain liabilities (and expenses incidental to such 
liabilities) to third persons not compensated by insurance or otherwise 
within the funds available under the Limitation of Cost or the 
Limitation of Funds clause of this contract. These liabilities must 
arise out of the performance of this contract, whether or not caused by 
the negligence of the Contractor or the Contractor's agents, servants, 
or employees, and must be represented by final judgments or settlements 
approved in writing by the Government. These liabilities are for:
    (i) Loss of or damage to property (other than property owned, 
occupied, or used by the Contractor, rented to the Contractor, or in the 
care, custody, or control of the Contractor); or
    (ii) Death or bodily injury.
    (d) The Government's liability under paragraph (c) of this clause is 
limited to the amounts reflected in final judgments, or settlements 
approved in writing by the Government, but in no event to exceed the 
funds available under the Limitation of Cost or Limitation of Funds 
clause of this contract. Nothing in this contract shall be construed as 
implying that, at a later date, the Government will request, or the 
Congress will appropriate, funds sufficient to meet any deficiencies.
    (e) The Contractor shall not be reimbursed for liabilities (and 
expenses incidental to such liabilities):
    (1) For which the Contractor is otherwise responsible under the 
express terms of any clause specified in the Schedule or elsewhere in 
the contract:
    (2) For which the Contractor has failed to insure or to maintain 
insurance as required by the Contracting Officer; or
    (3) That result from willful misconduct or lack of good faith on the 
part of the Contractor's directors, officers, managers, superintendents, 
or other representatives who have supervision or direction of:
    (i) All or substantially all of the Contractor's business;
    (ii) All or substantially all of the Contractor's operations at any 
one plant or separate location in which this contract is being 
performed; or
    (iii) A separate and complete major industrial operation in 
connection with the performance of this contract.

[[Page 78]]

    (f) The provisions of paragraph (e) of this clause shall not 
restrict the right of the Contractor to be reimbursed for the cost of 
insurance maintained by the Contractor in connection with the 
performance of this contract, other than insurance required in 
accordance with this clause; provided, that such cost is allowable under 
the Allowable Cost and Payment clause of this contract.
    (g) If any suit or action is filed or any claim is made against the 
Contractor, the cost and expense of which may be reimbursable to the 
Contractor under this contract, and the risk of which is then uninsured 
or is insured for less than the amount claimed, the Contractor shall:
    (1) Immediately notify the Contracting Officer and promptly furnish 
copies of all pertinent papers received;
    (2) Authorize Government representatives to collaborate with counsel 
for the insurance carrier in settling or defending the claim when the 
amount of the liability claimed exceeds the amount of coverage; and
    (3) Authorize Government representatives to settle or defend the 
claim and to represent the Contractor in or to take charge of any 
litigation, if required by the Government, when the liability is not 
insured or covered by the bond. The Contractor may, at its own expense, 
be associated with the Government representatives in any such claim or 
litigation.

                             (End of clause)

    Alternate I (APR 1984). If the successful offeror represents in the 
offer that the offeror is partially immune from tort liability as a 
State agency, add the following paragraph (h) to the basic clause:

    (h) Notwithstanding paragraphs (a) and (c) of this clause--
    (1) The Government does not assume any liability to third persons, 
nor will the Government reimburse the Contractor for its liability to 
third persons, with respect to loss due to death, bodily injury, or 
damage to property resulting in any way from the performance of this 
contract or any subcontract under this contract; and
    (2) The Contractor need not provide or maintain insurance coverage 
as required by paragraph (a) of this clause; provided, that the 
Contractor may obtain any insurance coverage deemed necessary, subject 
to approval by the Contracting Officer as to form, amount, and duration. 
The Contractor shall be reimbursed for the cost of such insurance and, 
to the extent provided in paragraph (c) of this clause, to liabilities 
to third persons for which the Contractor has obtained insurance 
coverage as provided in this paragraph, but for which such coverage is 
insufficient in amount.

                             (End of clause)

    Alternate II (APR 1984). If the successful offeror represents in the 
offer that the offeror is totally immune from tort liability as a State 
agency, substitute the following paragraphs (a) and (b) for paragraphs 
(a) and (b) of the basic clause:

    (a) The Government does not assume any liability to third persons, 
nor will the Government reimburse the Contractor for its liability to 
third persons, with respect to loss due to death, bodily injury, or 
damage to property resulting in any way from the performance of this 
contract or any subcontract under this contract.
    (b) If any suit or action is filed, or if any claim is made against 
the Contractor, the cost and expense of which may be reimbursable to the 
Contractor under this contract, the Contractor shall immediately notify 
the Contracting Officer and promptly furnish copies of all pertinent 
papers received by the Contractor. The Contractor shall, if required by 
the Government, authorize Government representatives to settle or defend 
the claim and to represent the Contractor in or take charge of any 
litigation. The Contractor may, at its own expense, be associated with 
the Government representatives in any such claims or litigation.

                             (End of clause)

[66 FR 4255, Jan. 17, 2001, as amended at 71 FR 76507, Dec. 20, 2006]



352.232-9  Withholding of contract payments.

    Insert the following clause in all solicitations and contracts other 
than awards made using simplified acquisition procedures:

               Withholding of Contract Payments (JAN 2006)

    Notwithstanding any other payment provisions of this contract, 
failure of the Contractor to submit required reports when due or failure 
to perform or deliver required work, supplies, or services, may result 
in the withholding of payments under this contract unless such failure 
arises out of causes beyond the control, and without the fault or 
negligence of the Contractor as defined by the clause entitled 
``Excusable Delays'' or ``Default'', as applicable. The Government shall 
immediately notify the Contractor of its intention to withhold payment 
of any invoice or voucher submitted.

[[Page 79]]

                             (End of clause)

[71 FR 76507, Dec. 20, 2006]



352.232-75  Incremental funding.

    The following provision shall be included in all requests for 
proposals whenever the use of incremental funding is contemplated:

                     Incremental Funding (JAN 2006)

    (a) It is the Government's intention to negotiate and award a 
contract using the incremental funding concepts described in the clause 
entitled Limitation of Funds, as specified in FAR 52.232-22. Under the 
clause, which will be included in the resultant contract, initial funds 
will be obligated under the contract to cover the first year of 
performance. The Government intends to allot additional funds up to and 
including the full estimated cost of the contract for the remaining 
years of performance by contract modification. However, the Government 
is not obligated to reimburse the Contractor for costs incurred in 
excess of the periodic allotments nor is the Contractor obligated to 
perform in excess of the amount allotted.
    (b) The Limitation of Funds clause to be included in the resultant 
contract, as specified in FAR 52.232-22, shall supersede the Limitation 
of Cost clause found in the Section I, Contract Clauses.

                           (End of provision)

[71 FR 76508, Dec. 20, 2006]



352.233-70  Litigation and claims.

    Insert the following clause in all solicitations and resultant cost-
reimbursement contracts:

                    Litigation and Claims (JAN 2006)

    The Contractor shall provide written notification immediately to the 
Contracting Officer of any action, including any proceeding before an 
administrative agency, filed against the Contractor arising out of the 
performance of this contract, including, but not limited to the 
performance of any subcontract hereunder; and any claim against the 
Contractor the cost and expense of which is allowable under the clause 
entitled ``Allowable Cost and Payment.'' Except as otherwise directed by 
the Contracting Officer, the Contractor shall furnish immediately to the 
Contracting Officer copies of all pertinent papers received by the 
Contractor with respect to such action or claim. To the extent not in 
conflict with any applicable policy of insurance, the Contractor may, 
with the Contracting Officer's approval, settle any such action or 
claim. If required by the Contracting Officer, the Contractor shall 
effect an assignment and subrogation in favor of the Government of all 
the Contractor's rights and claims (except those against the Government) 
arising out of any such action or claim against the Contractor; and 
authorize representatives of the Government to settle or defend any such 
action or claim and to represent the Contractor in, or to take charge 
of, any action. If the settlement or defense of an action or claim is 
undertaken by the Government, the Contractor shall furnish all 
reasonable assistance in effecting a settlement or asserting a defense. 
Where an action against the Contractor is not covered by a policy of 
insurance, the Contractor shall, with the approval of the Contracting 
Officer, proceed with the defense of the action in good faith. The 
Government shall not be liable for the expense of defending any action 
or for any costs resulting from the loss thereof to the extent that the 
Contractor would have been compensated by insurance which was required 
by law or regulation or by written direction of the Contracting Officer, 
but which the Contractor failed to secure through its own fault or 
negligence. In any event, unless otherwise expressly provided in this 
contract, the Contractor shall not be reimbursed or indemnified by the 
Government for any liability loss, cost or expense, which the Contractor 
may incur or be subject to by reason of any loss, injury or damage, to 
the person or to real or personal property of any third parties as may 
accrue during, or arise from, the performance of this contract.

                             (End of clause)

[71 FR 76508, Dec. 20, 2006]



352.242-71  Final decisions on audit findings.

    Insert the following clause in all solicitations and resultant cost-
reimbursement contracts.

              Final Decisions on Audit Findings (APR 1984)

    For the purpose of issuing final decisions under the Disputes clause 
of this contract concerning monetary audit findings, the Contracting 
Officer shall be that person with ultimate responsibility for making 
that decision in accordance with Chapter 1-105, Resolution of Audit 
Findings, of the Department's Grants Administration Manual.

                             (End of clause)



352.249-14  Excusable delays.

    Insert the following clause in all solicitations and resultant 
contracts,

[[Page 80]]

other than awards made using simplified acquisition procedures:

                       Excusable Delays (JAN 2006)

    (a) Except with respect to failures of subcontractors, the 
Contractor shall not be considered to have failed in performance of this 
contract if such failure arises out of causes beyond the control and 
without the fault or negligence of the Contractor.
    (b) Such causes may include, but are not restricted to, acts of God 
or of the public enemy, acts of the Government in either its sovereign 
or contractual capacity, fires, floods, epidemics, quarantine 
restrictions, strikes, freight embargoes, and unusually severe weather, 
but in every case the failure to perform must be beyond the control and 
without the fault or negligence of the Contractor. If the failure to 
perform is caused by the failure of a subcontractor to perform, and if 
such failure arises out of causes beyond the control of both the 
Contractor and subcontractor, and without the fault or negligence of 
either of them, the Contractor shall not be deemed to have failed in 
performance of the contract, unless: (1) The supplies or services to be 
furnished by the subcontractor were obtainable from other sources, (2) 
the Contracting Officer ordered the Contractor in writing to procure 
such supplies or services from such other sources, and (3) the 
Contractor failed to comply with such order. Upon request of the 
Contractor, the Contracting Officer shall ascertain the facts and extent 
of such failure and if the Contracting Officer determines that any 
failure to perform was caused by circumstances beyond the control and 
without the fault or negligence of the Contractor, the delivery schedule 
shall be revised accordingly, subject to the rights of the Government 
under the termination clause contained in this contract. (As used in 
this clause, the terms ``subcontractor'' and ``subcontractors'' mean 
subcontractor(s) at any tier.)

                             (End of clause)

[71 FR 76508, Dec. 20, 2006]



352.270-1  Accessibility of meetings, conferences, and seminars to persons with disabilities.

    Use the following clause in accordance with 370.102:

  Accessibility of Meetings, Conferences, and Seminars to Persons with 
                         Disabilities (JAN 2001)

    The Contractor agrees as follows:
    (a) Planning. The Contractor will develop a plan to assure that any 
meeting, conference, or seminar held pursuant to this contract will meet 
or exceed the minimum accessibility standards set forth in 28 CFR 
36.101-36.500 and Appendix A: ADA Accessibility Guidelines (ADAAG). The 
plan shall be submitted to the project officer for approval prior to 
initiating action. ( A consolidated or master plan for contracts 
requiring numerous meetings, conferences, or seminars may be submitted 
in lieu of separate plans.)
    (b) Facilities. Any facility to be utilized for meetings, 
conferences, or seminars in performance of this contract shall be in 
compliance with 28 CFR 36.101-36.500 and Appendix A. The Contractor 
shall determine, by an on-site inspection, that the facility meets these 
requirements.
    (1) Parking. Parking shall be in compliance with 28 CFR 36.101-
36.500 and Appendix A.
    (2) Entrances. Entrances shall be in compliance with 28 CFR 36.101-
36.500 and Appendix A.
    (3) Meeting Rooms. Meeting rooms, including seating arrangements, 
shall be in compliance with 28 CFR 36.101-36.500 and Appendix A. In 
addition, stages, speaker platforms, etc. which are to be used by 
persons in wheelchairs must be accessible by ramps or lifts. When used, 
the ramp may not necessarily be independently negotiable if space does 
not permit. However, any slope over 1:12 must be approved by the Project 
Officer and the Contractor must provide assistance to negotiate access 
to the stage or platform.
    (4) Restrooms. Restrooms shall be in compliance with 28 CFR 36.101-
36.500 and Appendix A.
    (5) Eating Facilities. Eating facilities in the meeting facility 
must also comply with 28 CFR 36.101-36.500 and Appendix A.
    (6) Overnight Facilities. If overnight accommodations are required, 
the facility providing the overnight accommodations shall also comply 
with 28 CFR 36.101-36.500 and Appendix A.
    (7) Water Fountains. Water fountains shall comply with 28 CFR 
36.101-36.500 and Appendix A.
    (8) Telephones. Public telephones shall comply with 28 CFR 36.101-
36.500 and Appendix A.
    (c) Provisions of Services for Attendees with Sensory Impairments. 
(1) The Contractor, in planning the meeting, conference, or seminar, 
shall include in all announcements and other materials pertaining to the 
meeting, conference, or seminar a notice indicating that services will 
be made available to persons with sensory impairments attending the 
meeting, if requested within five (5) days of the date of the meeting, 
conference, or seminar. The announcement(s) and other material(s) shall 
indicate that persons with sensory impairments may contact a specific 
person(s), at a specific address and phone number(s), to make their 
service requirements known. The phone number(s) shall include a 
telecommunication device for the deaf (TDD).

[[Page 81]]

    (2) The Contractor shall provide, at no additional cost to the 
individual, those services required by persons with sensory impairments 
to insure their complete participation in the meeting, conference, or 
seminar.
    (3) At a minimum, when requested in advance, the Contractor shall 
provide the following services:
    (i) For persons with hearing impairments, qualified interpreters. 
Also, the meeting rooms will be adequately illuminated so signing by 
interpreters can be easily seen.
    (ii) For persons with vision impairments, readers and/or cassette 
materials, as necessary, to enable full participation. Also, meeting 
rooms will be adequately illuminated.
    (iii) Agenda and other conference material(s) shall be translated 
into a usable form for persons with sensory impairments. Readers, 
Braille translations, large print text, and/or tape recordings are all 
acceptable. These materials shall be available to individuals with 
sensory impairments upon their arrival.

                             (End of clause)

[66 FR 4255, Jan. 17, 2001, as amended at 71 FR 76508, Dec. 20, 2006]



352.270-2  Indian preference.

    Use the following clause as prescribed in 370.202(a):

                      Indian Preference (APR 1984)

    (a) The Contractor agrees to give preference in employment 
opportunities under this contract to Indians who can perform required 
work, regardless of age (subject to existing laws and regulations), sex, 
religion, or tribal affiliation. To the extent feasible and consistent 
with the efficient performance of this contract, the Contractor further 
agrees to give preference in employment and training opportunities under 
this contract to Indians who are not fully qualified to perform 
regardless of age (subject to existing laws and regulations), sex, 
religion, or tribal affiliation. The Contractor also agrees to give 
preference to Indian organizations and Indian-owned economic enterprises 
in the awarding of any subcontracts to the extent feasible and 
consistent with the efficient performance of this contract. The 
Contractor shall maintain statistical records as are necessary to 
indicate compliance with this paragraph.
    (b) In connection with the Indian employment preference requirements 
of this clause, the Contractor shall provide opportunities for training 
incident to such employment. Such training shall include on-the-job, 
classroom or apprenticeship training which is designed to increase the 
vocational effectiveness of an Indian employee.
    (c) If the Contractor is unable to fill its employment and training 
opportunities after giving full consideration to Indians as required by 
this clause, those needs may be satisfied by selection of persons other 
than Indians in accordance with the clause of this contract entitled 
``Equal Opportunity.''
    (d) If no Indian organizations or Indian-owned economic enterprises 
are available under reasonable terms and conditions, including price, 
for awarding of subcontracts in connection with the work performed under 
this contract, the Contractor agrees to comply with the provisions of 
this contract involving utilization of small business concerns, small 
disadvantaged business concerns, and women-owned small business 
concerns.
    (e) As used in this clause:
    (1) ``Indian'' means a person who is a member of an Indian Tribe. If 
the Contractor has reason to doubt that a person seeking employment 
preference is an Indian, the Contractor shall grant the preference but 
shall require the individual to provide evidence within thirty (30) days 
from the Tribe concerned that the person is a member of the Tribe.
    (2) ``Indian Tribe'' means an Indian Tribe, pueblo, band, nation, or 
other organized group or community, including Alaska Native village or 
regional or village corporation as defined in or established pursuant to 
the Alaska Native Claims Settlement Act (85 Stat. 688; 43 U.S.C. 1601) 
which is recognized as eligible for the special programs and services 
provided by the United States to Indians because of their status as 
Indians.
    (3) ``Indian organization'' means the governing body of any Indian 
Tribe or entity established or recognized by such governing body in 
accordance with the Indian Financing Act of 1974 (88 Stat. 77; 25 U.S.C. 
1451); and
    (4) ``Indian-owned economic enterprise'' means any Indian-owned 
commercial, industrial, or business activity established or organized 
for the purpose of profit, provided that such Indian ownership shall 
constitute not less than 51 percent of the enterprise, and that 
ownership shall encompass active operation and control of the 
enterprise.
    (f) The Contractor agrees to include the provisions of this clause, 
including this paragraph (f) of this clause, in each subcontract awarded 
at any tier under this contract.
    (g) In the event of noncompliance with this clause, the Contracting 
Officer may terminate the contract in whole or in part or may impose any 
other sanctions authorized by law or by other provisions of the 
contract.

                             (End of clause)

[66 FR 4255, Jan. 17, 2001, as amended at 71 FR 76508, Dec. 20, 2006]

[[Page 82]]



352.270-3  Indian preference program.

    Use the following clause as prescribed in 370.202(b):

                  Indian Preference Program (JAN 2006)

    (a) In addition to the requirements of the clause of this contract 
entitled ``Indian Preference,'' the Contractor agrees to establish and 
conduct an Indian preference program which will expand opportunities for 
Indians to receive preference for employment and training in connection 
with the work to be performed under this contract, and which will expand 
the opportunities for Indian organizations and Indian-owned economic 
enterprises to receive a preference in the awarding of subcontracts. In 
this connection, the Contractor shall:
    (1) Designate a liaison officer who will maintain liaison with the 
Government and the Tribe(s) on Indian preference matters; supervise 
compliance with the provisions of this clause; and administer the 
Contractor's Indian preference program.
    (2) Advise its recruitment sources in writing and include a 
statement in all advertisements for employment that Indian applicants 
will be given preference in employment and training incident to such 
employment.
    (3) Not more than twenty (20) calendar days after award of the 
contract, post a written notice in the Tribal office of any reservations 
on which or near where the work under this contract is to be performed 
that sets forth the Contractor's employment needs and related training 
opportunities. The notice shall include the approximate numbers and 
types of employees needed; the approximate dates of employment; the 
experience or special skills required for employment, if any; training 
opportunities available; and other pertinent information necessary to 
advise prospective employees of any other employment requirements. The 
Contractor shall also request the Tribe(s) on or near whose 
reservation(s) the work is to be performed to provide assistance to the 
Contractor in filling its employment needs and training opportunities. 
The Contracting Officer will advise the Contractor of the name, 
location, and phone number of the Tribal officials to contact in regard 
to the posting of notices and requests for Tribal assistance.
    (4) Establish and conduct a subcontracting program which gives 
preference to Indian organizations and Indian-owned economic enterprises 
as subcontractors and suppliers under this contract. The Contractor 
shall give public notice of existing subcontracting opportunities and, 
to the extent feasible and consistent with the efficient performance of 
this contract, shall solicit bids or proposals only from Indian 
organizations or Indian-owned economic enterprises. The Contractor shall 
request assistance and information on Indian firms qualified as 
suppliers or subcontractors from the Tribe(s) on or near whose 
reservation(s) the work under the contract is to be performed. The 
Contracting Officer will advise the Contractor of the name, location, 
and phone number of the Tribal officials to be contacted in regard to 
the request for assistance and information. Public notices and 
solicitations for existing subcontracting opportunities shall provide an 
equitable opportunity for Indian firms to submit bids or proposals by 
including: (i) A clear description of the supplies or services required, 
including quantities, specifications, and delivery schedules which 
facilitate the participation of Indian firms; (ii) A statement 
indicating that preference will be given to Indian organizations and 
Indian-owned economic enterprises in accordance with section 7(b) of 
Public Law 93-638 (88 Stat. 2205; 25 U.S.C. 450e(b)); (iii) Definitions 
for the terms ``Indian organization'' and ``Indian-owned economic 
enterprise'' as prescribed under the ``Indian Preference'' clause of 
this contract; (iv) A statement to be completed by the bidder or offeror 
that it is an Indian organization or Indian-owned economic enterprise; 
and (v) A closing date for receipt of bids or proposals which provides 
sufficient time for preparation and submission of a bid or proposal. If 
after soliciting bids or proposals from Indian organizations and Indian-
owned economic enterprises, no responsive bid or acceptable proposal is 
received, the Contractor shall comply with the requirements of paragraph 
(d) of the ``Indian Preference'' clause of this contract. If one or more 
responsible bids or acceptable proposals are received, award shall be 
made to the low responsible bidder or acceptable offeror if the price is 
determined to be reasonable. If the low responsive bid or acceptable 
proposal is determined to be unreasonable as to price, the Contractor 
shall attempt to negotiate a reasonable price and award a subcontract. 
If a reasonable price cannot be agreed upon, the Contractor shall comply 
with the requirements of paragraph (d) of the ``Indian Preference'' 
clause of this contract.
    (5) Maintain written records under this contract which indicate: (i) 
The numbers of Indians seeking employment for each employment position 
available under this contract; (ii) The number and types of positions 
filled by Indians and non-Indians; (iii) The total number of Indians 
employed under this contract; (iv) For those positions where there are 
both Indian and non-Indian applicants, and a non-Indian is selected for 
employment, the reason(s) why the Indian applicant was not selected; (v) 
Actions taken to give preference to Indian organizations and Indian-
owned economic enterprises for subcontracting opportunities which exist

[[Page 83]]

under this contract; (vi) Reasons why preference was not given to Indian 
firms as subcontractors or suppliers for each requirement where it was 
determined by the Contractor that such preference would not be 
consistent with the efficient performance of the contract; and (vii) The 
number of Indian organizations and Indian-owned economic enterprises 
contacted, and the number receiving subcontract awards under this 
contract.
    (6) Submit to the Contracting Officer for approval a quarterly 
report which summarizes the Contractor's Indian preference program and 
indicates the number and types of available positions filled by Indians 
and non-Indians, and the dollar amounts of all subcontracts awarded to 
Indian organizations and Indian-owned economic enterprises, and to all 
other firms.
    (7) Maintain records pursuant to this clause and keep them available 
for review by the Government for one year after final payment under this 
contract, or for such longer period as may be required by any other 
clause of this contract or by applicable law or regulation.
    (b) For purposes of this clause, the following definitions of terms 
shall apply:
    (1) The terms ``Indian,'' ``Indian Tribe,'' ``Indian Organization,'' 
and ``Indian-owned economic enterprise'' are defined in the clause of 
this contract entitled ``Indian Preference.''
    (2) ``Indian reservation'' includes Indian reservations, public 
domain Indian Allotments, former Indian reservations in Oklahoma, and 
land held by incorporated Native groups, regional corporations, and 
village corporations under the provisions of the Alaska Native Claims 
Settlement Act (85 Stat. 688; 43 U.S.C. 1601 et seq.)
    (3) ``On or near an Indian Reservation'' means on a reservation or 
reservations or within that area surrounding an Indian reservation(s) 
where a person seeking employment could reasonably be expected to 
commute to and from in the course of a work day.
    (c) Nothing in the requirements of this clause shall be interpreted 
to preclude Indian Tribes from independently developing and enforcing 
their own Indian preference requirements. Such requirements must not 
conflict with any Federal statutory or regulatory requirement dealing 
with the award and administration of contracts.
    (d) The Contractor agrees to include the provisions of this clause, 
including this paragraph (d), in each subcontract awarded at any tier 
under this contract and to notify the Contracting Officer of such 
subcontracts.
    (e) In the event of noncompliance with this clause, the Contracting 
Officer may terminate the contract in whole or in part or may impose any 
other sanctions authorized by law or by other provisions of the 
contract.

                             (End of clause)

[71 FR 76508, Dec. 20, 2006]



352.270-4  Pricing of adjustments.

    Insert the following clause in all solicitations and resultant 
fixed-priced contracts other than awards made using simplified 
acquisition procedures.

                    Pricing of Adjustments (JAN 2001)

    When costs are a factor in determination of a contract price 
adjustment pursuant to the ``Changes'' clause or any provision of this 
contract, such costs shall be determined in accordance with the 
applicable cost principles and procedures set forth below:

------------------------------------------------------------------------
                Principles                     Types of organizations
------------------------------------------------------------------------
(a) Subpart 31.2 of the Federal             Commercial.
 Acquisition Regulation.
(b) Subpart 31.3 of the Federal             Educational.
 Acquisition Regulation.
(c) Subpart 31.6 of the Federal             State, local, and federally
 Acquisition Regulation.                     recognized Indian tribal
                                             governments.
(d) 45 CFR Part 74 Appendix E.............  Hospitals (performing
                                             research and development
                                             contracts only.
(e) Subpart 31.7 of the Federal             Other nonprofit
 Acquisition Regulation.                     institutions.
------------------------------------------------------------------------

                             (End of clause)

[66 FR 4255, Jan. 17, 2001, as amended at 71 FR 76509, Dec. 20, 2006]



352.270-5  Key personnel.

    Insert the following clause in all solicitations and resultant 
contracts which require Key Personnel, regardless of the type of 
contract.

                        Key Personnel (JAN 2006)

    The key personnel specified in this contract are considered to be 
essential to work performance. At least 30 days prior to diverting any 
of the specified individuals to other programs or contracts (or as soon 
as possible, if an individual must be replaced, for example, as a result 
of leaving the employ of the Contractor), the Contractor shall notify 
the Contracting Officer and shall submit comprehensive justification for 
the diversion or replacement request (including proposed substitutions 
for key personnel) to permit evaluation by the Government of the impact 
on performance under this contract. The Contractor shall not divert or 
otherwise replace any key personnel without the written consent of the 
Contracting Officer. The Government may modify the contract to add or

[[Page 84]]

delete key personnel at the request of the contractor or Government.

                             (End of clause)

[71 FR 76509, Dec. 20, 2006]



352.270-6  Publications and publicity.

    Insert the following clause in all solicitations and resultant 
contracts.

                  Publications and Publicity (JAN 2006)

    (a) Unless otherwise specified in this contract and the 
Confidentiality of Information clause is included, the Contractor is 
encouraged to publish the results of its work under this contract. A 
copy of each article submitted by the Contractor for publication shall 
be promptly sent to the Project Officer. The Contractor shall also 
inform the Project Officer when the article or other publication is 
published, and furnish a copy of it as finally published.
    (b) The Contractor shall include in any publication resulting from 
work performed under this contract a disclaimer reading as follows:
    ``The views expressed in written conference materials or 
publications and by speakers and moderators at HHS-sponsored 
conferences, do not necessarily reflect the official policies of the 
Department of Health and Human Services; nor does mention of trade 
names, commercial practices, or organizations imply endorsement by the 
U.S. Government.''
    (c) Unless authorized by the Project Officer, the contractor shall 
not display the HHS logo on any conference materials or publications.

                             (End of clause)

[71 FR 76510, Dec. 20, 2006]



352.270-7  Paperwork Reduction Act.

    Insert the following clause in all solicitations and contracts 
subject to the Paperwork Reduction Act requirements regarding the 
collection and recording of information from 10 or more persons other 
than Federal employees.

                   Paperwork Reduction Act (JAN 2006)

    (a) This contract involves a requirement to collect or record 
information calling either for answers to identical questions from 10 or 
more persons other than Federal employees, or information from Federal 
employees which is outside the scope of their employment, for use by the 
Federal government or disclosure to third parties; therefore, the 
Paperwork Reduction Act of 1995 (Pub. L. 104-13) shall apply to this 
contract. No plan, questionnaire, interview guide or other similar 
device for collecting information (whether repetitive or single-time) 
may be used without first obtaining clearance from the Office of 
Management and Budget (OMB). Contractors and Project Officers should be 
guided by the provisions of 5 CFR part 1320, Controlling Paperwork 
Burdens on the Public, and seek the advice of the HHS operating division 
or Office of the Secretary Reports Clearance Officer to determine the 
procedures for acquiring OMB clearance.
    (b) The Contractor shall not expend any funds or begin any data 
collection until OMB Clearance is received. Once OMB Clearance is 
received from the Project Officer, the Contracting Officer shall provide 
the Contractor with written notification authorizing the expenditure of 
funds and the collection of data. The Contractor must allow at least 120 
days for OMB clearance. Excessive delays caused by the Government which 
arise out of causes beyond the control and without the fault or 
negligence of the Contractor will be considered in accordance with the 
Excusable Delays or Default clause of this contract.

                             (End of clause)

[71 FR 76510, Dec. 20, 2006]



352.270-8  Protection of human subjects.

    (a) Include the following provision in solicitations expected to 
involve human subjects:

  Notice to Offerors of Requirements of 45 CFR Part 46, Protection of 
                        Human Subjects (JAN 2006)

    (a) Copies of the Department of Health and Human Services (HHS) 
regulations for the protection of human subjects, 45 CFR part 46, are 
available from the Office for Human Research Protections (OHRP), 
Bethesda, Maryland 20892. The regulations provide a systematic means, 
based on established ethical principles, to safeguard the rights and 
welfare of individuals who participate as subjects in research 
activities supported or conducted by HHS.
    (b) The regulations define a human subject as a living individual 
about whom an investigator (whether professional or student) conducting 
research obtains data through intervention or interaction with the 
individual, or identifiable private information. The regulations extend 
to the use of human organs, tissue, and body fluids from individually 
identifiable human subjects as well as to graphic, written, or recorded 
information derived from individually identifiable human subjects. The 
use of autopsy materials is governed by applicable State and local law

[[Page 85]]

and is not directly regulated by 45 CFR part 46.
    (c) Activities in which the only involvement of human subjects will 
be in one or more of the categories set forth in 45 CFR 46.101(b)(1-6) 
are exempt from coverage.
    (d) Inappropriate designations of the noninvolvement of human 
subjects or of exempt categories of research in a project may result in 
delays in the review of a proposal. The OPDIV will make a final 
determination of whether the proposed activities are covered by the 
regulations or are in an exempt category, based on the information 
provided in the proposal. In doubtful cases, prior consultation with 
OHRP, (telephone: 301-496-7014), is recommended.
    (e) In accordance with 45 CFR part 46, prospective Contractors being 
considered for award shall be required to file with OHRP an acceptable 
Assurance of Compliance with the regulations, specifying review 
procedures and assigning responsibilities for the protection of human 
subjects. The initial and continuing review of a research project by an 
institutional review board shall assure that the rights and welfare of 
the human subjects involved are adequately protected, that the risks to 
the subjects are reasonable in relation to the potential benefits, if 
any, to the subjects and the importance of the knowledge to be gained, 
and that informed consent will be obtained by methods that are adequate 
and appropriate. HHS regulations for the protection of human subjects 
(45 CFR part 46), information regarding OHRP registration and assurance 
requirements/processes, and OHRP contact information can be accessed at 
the OHRP Web site: http://www.hhs.gov/ohrp/.
    (f) It is recommended that OHRP be consulted for advice or guidance 
concerning either regulatory requirements or ethical issues pertaining 
to research involving human subjects.

                           (End of provision)

    (b) Include the following clause in solicitations and resultant 
contracts involving human subjects:

                 Protection of Human Subjects (JAN 2006)

    (a) The Contractor agrees that the rights and welfare of human 
subjects involved in research under this contract shall be protected in 
accordance with 45 CFR part 46 and with the Contractor's current 
Assurance of Compliance on file with the Office for Human Research 
Protections (OHRP), Office of Public Health and Science (OPHS). The 
Contractor further agrees to provide certification at least annually 
that the Institutional Review Board has reviewed and approved the 
procedures, which involve human subjects in accordance with 45 CFR part 
46 and the Assurance of Compliance.
    (b) The Contractor shall bear full responsibility for the 
performance of all work and services involving the use of human subjects 
under this contract and shall ensure that work is conducted in a proper 
manner and as safely as is feasible. The parties hereto agree that the 
Contractor retains the right to control and direct the performance of 
all work under this contract. Nothing in this contract shall be deemed 
to constitute the Contractor or any subcontractor, agent or employee of 
the Contractor, or any other person, organization, institution, or group 
of any kind whatsoever, as the agent or employee of the Government. The 
Contractor agrees that it has entered into this contract and will 
discharge its obligations, duties, and undertakings and the work 
pursuant thereto, whether requiring professional judgment or otherwise, 
as an independent contractor without imputing liability on the part of 
the Government for the acts of the Contractor or its employees.
    (c) If at any time during the performance of this contract, the 
Contracting Officer determines, in consultation with the OHRP, OPHS, 
ASH, that the Contractor is not in compliance with any of the 
requirements and/or standards stated in paragraphs (a) and (b) above, 
the Contracting Officer may immediately suspend, in whole or in part, 
work and further payments under this contract until the Contractor 
corrects the noncompliance. Notice of the suspension may be communicated 
by telephone and confirmed in writing. If the Contractor fails to 
complete corrective action within the period of time designated in the 
Contracting Officer's written notice of suspension, the Contracting 
Officer may, in consultation with OHRP, OPHS, ASH, terminate this 
contract in a whole or in part, and the Contractor's name may be removed 
form the list of those contractors with approved Health and Human 
Services Human Subject Assurances.

                             (End of clause)

[71 FR 76510, Dec. 20, 2006]



352.270-9  Care of laboratory animals.

    (a) Include the following provision in solicitations expected to 
involve vertebrate animals:

Notice to Offerors of Requirement for Compliance With the Public Health 
 Service Policy on Humane Care and Use of Laboratory Animals (JAN 2006)

    The PHS Policy on Humane Care and Use of Laboratory Animals by 
Awardee Institutions establishes a number of requirements

[[Page 86]]

for research activities involving animals. Before award may be made to 
an applicant organization, the organization shall file, with the Office 
of Laboratory Animal Welfare (OLAW), National Institutes of Health 
(NIH), a written Animal Welfare Assurance which commits the organization 
to comply with the provisions of the PHS Policy on Humane Care and Use 
of Laboratory Animals by Awardee Institutions, the Animal Welfare Act, 
and the Guide for the Care and Use of Laboratory Animals prepared by the 
Institute of Laboratory Animal Resources. In accordance with the PHS 
Policy on Humane Care and Use of Laboratory Animals by Awardee 
Institutions, applicant organizations must establish a committee, 
qualified through the experience and expertise of its members, to 
oversee the institution's animal program, facilities and procedures. No 
award involving the use of animals shall be made unless OLAW approves 
the Animal Welfare Assurance. Prior to award, the Contracting Officer 
will notify Contractor(s) selected for projects that involve live 
vertebrate animals that an Animal Welfare Assurance is required. The 
Contracting Officer will request that OLAW negotiate an acceptable 
Animal Welfare Assurance with those Contractor(s). For further 
information, contact OLAW at NIH, Bethesda, Maryland 20892 (301-496-
7163).

                           (End of provision)

    (b) Include the following clause in all solicitations and resultant 
contracts involving research on vertebrate animals:

             Care of Live Vertebrate Animals (January 2006)

    (a) Before undertaking performance of any contract involving animal 
related activities, the Contractor shall register with the Secretary of 
Agriculture of the United States in accordance with 7 U.S.C. 2136 and 9 
CFR 2.25 through 2.28. The Contractor shall furnish evidence of the 
registration to the Contracting Officer.
    (b) The Contractor shall acquire vertebrate animals used in research 
from a dealer licensed by the Secretary of Agriculture under 7 U.S.C. 
2133 and 9 CFR 2.1 through 2.11, or from a source that is exempt from 
licensing under those sections.
    (c) The Contractor agrees that the care and use of any live 
vertebrate animals used or intended for use in the performance of this 
contract will conform with the PHS Policy on Humane Care of Use of 
Laboratory Animals, the current Animal Welfare Assurance, the Guide for 
the Care and Use of Laboratory Animals prepared by the Institute of 
Laboratory Animal Resources and the pertinent laws and regulations of 
the United States Department of Agriculture (see 7 U.S.C. 2131 et seq. 
and 9 CFR Subchapter A, Parts 1-4). In case of conflict between 
standards, the more stringent standard shall be used.
    (d) If at any time during performance of this contract, the 
Contracting Officer determines, in consultation with the Office of 
Laboratory Animal Welfare (OLAW), National Institutes of Health (NIH), 
that the Contractor is not in compliance with any of the requirements 
and/or standards stated in paragraphs (a) through (c) above, the 
Contracting Officer may immediately suspend, in whole or in part, work 
and further payments under this contract until the Contractor corrects 
the noncompliance. Notice of the suspension may be communicated by 
telephone and confirmed in writing. If the Contractor fails to complete 
corrective action within the period of time designated in the 
Contracting Officer's written notice of suspension, the Contracting 
Officer may, in consultation with OLAW, NIH, terminate this contract in 
whole or in part, and the Contractor's name may be removed from the list 
of those contractors with approved PHS Animal Welfare Assurances.
    Note: The Contractor may request registration of its facility and a 
current listing of licensed dealers from the Regional Office of the 
Animal and Plant Health Inspection Service (APHIS), USDA, for the region 
in which its research facility is located. The location of the 
appropriate APHIS Regional Office, as well as information concerning 
this program may be obtained by contacting the Animal Care Staff, USDA/
APHIS, 4700 River Road, Riverdale, Maryland 20737.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-10  Anti-lobbying.

    Insert the following clause in all solicitations and resultant 
contracts expected to exceed $100,000:

                        Anti-Lobbying (JAN 2006)

    Pursuant to the current HHS annual appropriations act, except for 
normal and recognized executive-legislative relationships, the 
Contractor shall not use any HHS contract funds for (i) publicity or 
propaganda purposes; (ii) the preparation, distribution, or use of any 
kit, pamphlet, booklet, publication, radio, television or video 
presentation designed to support or defeat legislation pending before 
the Congress or any State legislature, except in presentation to the 
Congress or any State legislature itself; or (iii) payment of salary or 
expenses of the Contractor, or any agent acting for the Contractor, 
related to any activity designed to

[[Page 87]]

influence legislation or appropriations pending before the Congress or 
any State legislature.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-11  Privacy Act.

    The following clause shall be used as prescribed in 324.103(a):

                         Privacy Act (JAN 2006)

    This contract requires the Contractor to perform one or more of the 
following: (a) Design; (b) develop; or (c) operate a Federal agency 
system of records to accomplish an agency function in accordance with 
the Privacy Act of 1974 (Act) (5 U.S.C. 552a(m)(1)) and applicable 
agency regulations. The term ``system of records'' means a group of any 
records under the control of any agency from which information is 
retrieved by the name of the individual or by some identifying number, 
symbol, or other identifying particular assigned to the individual.
    Violations of the Act by the Contractor and/or its employees may 
result in the imposition of criminal penalties (5 U.S.C. 552a(i)). The 
Contractor shall ensure that each of its employees knows the prescribed 
rules of conduct and that each employee is aware that he/she is subject 
to criminal penalties for violation of the Act to the same extent as HHS 
employees. These provisions also apply to all subcontracts awarded under 
this contract which require the design, development or operation of the 
designated system(s) of records (5 U.S.C. 552a(m)(1)).
    The contract work statement: (a) identifies the system(s) of records 
and the design, development, or operation work to be performed by the 
Contractor; and (b) specifies the disposition to be made of such records 
upon completion of contract performance.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-12  Pro-Children Act.

    Insert the following clause in all solicitations and resultant 
contracts and orders, regardless of dollar amount, for (i) kindergarten, 
elementary, or secondary education or library services or (ii) health or 
day care services that are provided to children under the age of 18 on a 
routine or regular basis pursuant to the Pro-Children Act of 1994:

                   Pro-Children Act of 1994 (JAN 2006)

    Public Law 103-227, Title X, Part C, also known as the Pro-Children 
Act of 1994 (Act), 20 U.S.C. 7183, imposes restrictions on smoking in 
facilities where certain federally funded children's services are 
provided. The Act prohibits smoking within any indoor facility (or 
portion thereof), whether owned, leased, or contracted for, that is used 
for the routine or regular provision of (i) kindergarten, elementary, or 
secondary education or library services or (ii) health or day care 
services that are provided to children under the age of 18. The 
statutory prohibition also applies to indoor facilities that are 
constructed, operated, or maintained with Federal funds.
    By acceptance of this contract or order, the Contractor agrees to 
comply with the requirements of the Act. The Act also applies to all 
subcontracts awarded under this contract for the specified children's 
services. Accordingly, the Contractor shall ensure that each of its 
employees, and any subcontractor staff, is made aware of, understand, 
and comply with the provisions of the Act.
    Failure to comply with the Act may result in the imposition of a 
civil monetary penalty in an amount not to exceed $1,000 for each 
violation and/or the imposition of an administrative compliance order on 
the responsible entity. Each day a violation continues constitutes a 
separate violation.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-13  Tobacco-free facilities.

    Insert the following clause in all new solicitations and resultant 
contracts and orders (including construction) and all modifications 
resulting from the exercise of an option under a contract or order, 
regardless of dollar value, where some or all of the Contractor's 
performance, will take place on HHS properties. This clause is not 
required to be included if contract or order performance requires only 
that Contractor staff attend occasional meetings on HHS properties. In 
this case, Contractor employees are considered ``visitors.'' Further, 
for any proposed or existing construction contract or order, the 
Contracting Officer should coordinate any exceptions to the policy 
raised by an incumbent or potential Contractor based on union or 
collective bargaining agreements with the designated OPDIV tobacco-free 
policy contact point for final disposition.

                   Tobacco-Free Facilities (JAN 2006)

    In accordance with Department of Health and Human Services (HHS) 
policy, the Contractor and its staff are prohibited from

[[Page 88]]

using tobacco products of any kind (e.g., cigarettes, cigars, pipes, and 
smokeless tobacco) while on any HHS property, including use in personal 
or company vehicles operated by Contractor employees while on an HHS 
property. This policy also applies to all subcontracts awarded under the 
contract or order.
    The term ``HHS properties'' includes all properties owned, 
controlled and/or leased by HHS when totally occupied by HHS, including 
all indoor and outdoor areas of such properties. Where HHS only 
partially occupies such properties, it includes all HHS-occupied 
interior space. Where HHS leases space in a multi-occupant building or 
complex, the tobacco-free HHS policy will apply to the maximum area 
permitted by law and compliance with the provisions of any current lease 
agreements.
    The Contractor shall ensure that each of its employees, and any 
subcontractor staff, is made aware of, understand, and comply with this 
policy.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-14  Restriction on use of human subjects.

    If the Contractor has an approved Federal-wide assurance of 
compliance in place, but the certification that the Institutional Review 
Board (IRB) designated under the assurance has reviewed and approved the 
research cannot be completed prior to contract award because definite 
plans for involvement of human subjects are not set forth in the 
proposal (e.g., projects in which human subjects' involvement will 
depend upon completion of instruments, prior animal studies, or 
purification of compounds), the award may be made without the requisite 
certification as long as the contract is appropriately conditioned. 
Under these conditions, insert the following clause in applicable 
contracts:

             Restriction on Use of Human Subjects (JAN 2006)

    Pursuant to 45 CFR part 46, Protection of Human Research Subjects, 
the Contractor shall not expend funds under this award for research 
involving human subjects or engage in any human subjects research 
activity prior to the receipt by the Contracting Officer of a 
certification that the research has been reviewed and approved by the 
Institutional Review Board (IRB) designated under the Contractor's 
Federal-wide assurance of compliance. This restriction applies to all 
collaborating sites, whether domestic or foreign, and subcontractors. 
The Contractor must ensure compliance by collaborators and 
subcontractors.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-15  Salary rate limitation.

    Insert the following clause in all new NIH, SAMHSA, and AHRQ 
solicitations and resultant contracts and orders (except fixed-price 
completion contracts) and modifications of existing contracts for 
projects that support extramural activities. Projects that support 
extramural activities include extramural R&D, SAMHSA's mission-related 
requirements, and those activities commonly referred to as ``extramural 
R&D support.''

OR

    Insert the following clause in all new NIH, SAMHSA, and AHRQ 
solicitations and resultant contracts (except fixed-price completion 
contracts) and modifications of existing contracts for extramural R&D 
and SAMHSA's mission-related requirements. Projects that are not 
considered R&D but that support extramural R&D activities (commonly 
referred to as ``extramural R&D support'') are OR are not included.

                    Salary Rate Limitation (JAN 2006)

    Pursuant to the applicable HHS appropriations acts cited in the 
table below, the Contractor shall not use contract funds to pay the 
direct salary of an individual at a rate in excess of the salary level 
in effect on the date the expense is incurred as shown in the table 
below.
    For purposes of the salary limitation, the terms ``direct salary,'' 
``salary,'' and ``institutional base salary'' have the same meaning and 
are collectively referred to as ``direct salary'' in this clause. An 
individual's direct salary is the annual compensation that the 
Contractor pays for an individual's appointment whether that 
individual's time is spent on research, teaching, patient care, or other 
activities. Direct salary excludes any income that an individual may be 
permitted to earn outside of duties to the Contractor. Direct salary 
also excludes fringe benefits, overhead, and general and administrative 
expenses (also referred to as indirect costs or facilities and 
administrative [F&A] costs).
    The salary rate limitation also applies to individuals performing 
under subcontracts.

[[Page 89]]

However, it does not apply to fees paid to consultants. If this is a 
multiple-year contract, it may be subject to unilateral modification by 
the Contracting Officer to ensure that an individual is not paid at a 
rate that exceeds the salary rate limitation provision established in 
the HHS appropriations act in effect when the expense is incurred 
regardless of the rate initially used to establish contract funding.

------------------------------------------------------------------------
                                                                Salary
                                                              limitation
             Public law                  Period covered       (based on
                                                              Executive
                                                               Level I)
------------------------------------------------------------------------
108-447, Div F, Title II, General    10/01/05--12/31/05....     $180,100
 Provisions, Section 204.
109-149, General Provisions,         01/01/06--until            $183,500
 Section 204.                         revised.
------------------------------------------------------------------------

    Executive Level salaries for the current and prior periods can be 
found at the following Web site: http://www.opm.gov/oca/05tables/html/
ex.asp. Click on ``Salaries and Wages'' and then scroll to the bottom of 
the page to select the desired period.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-16  Native American Graves Protection and Repatriation Act.

    Insert the following clause in any solicitation and resultant 
contract or order that requires performance on tribal lands and all 
solicitations and resultant contracts or orders for construction on 
Federal or tribal lands, regardless of dollar amount:

    Native American Graves Protection and Repatriation Act (JAN 2006)

    Public Law 101-601, dated November 16, 1990, also known as the 
Native American Graves Protection and Repatriation Act (Act), imposes 
certain responsibilities on individuals and organizations when they 
discover Native American cultural items (including human remains) on 
Federal or tribal lands.
    In the event the Contractor discovers Native American cultural items 
(including human remains, associated funerary objects, unassociated 
funerary objects, sacred objects and cultural patrimony), as defined in 
the Act during contract performance, the Contractor shall: (i) 
Immediately cease activity in the area of the discovery; (ii) notify the 
Contracting Officer of the discovery; and (iii) make a reasonable effort 
to protect the items discovered before resuming such activity. Upon 
receipt of the Contractor's discovery notice, the Contracting Officer 
will notify the appropriate authorities as required by the Act.
    Unless otherwise specified by the Contracting Officer, the 
Contractor may resume activity in the area on the 31st calendar day 
following the date that the appropriate authorities certify receipt of 
the discovery notice. The date that the appropriate authorities certify 
receipt of the discovery notice and the date on which the Contractor may 
resume activities shall be provided to the Contractor by the Contracting 
Officer.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-17  Crime Control Act--Reporting of child abuse.

    Insert the following clause in all solicitations and resultant 
contracts and orders, regardless of dollar amount, where performance 
will take place on Federal land or in a federally-operated (or 
contracted) facility and that involve the professions/activities 
performed by persons specified in the Crime Control Act of 1990, 
including, but not limited to, physicians, nurses, dentists, health care 
practitioners, optometrists, psychologists, emergency medical 
technicians, alcohol or drug treatment personnel, child care workers and 
administrators, emergency medical technicians and ambulance drivers:

     Crime Control Act of 1990--Reporting of Child Abuse (JAN 2006)

    Public Law 101-647, also known as the Crime Control Act of 1990 
(Act), imposes responsibilities on certain individuals who, while 
engaged in a professional capacity or activity, as defined in the Act, 
on Federal land or in a federally-operated (or contracted) facility, 
learn of facts that give the individual reason to suspect that a child 
has suffered an incident of child abuse.
    The Act designates ``covered professionals'' as those persons 
engaged in professions and activities in eight different categories 
including, but not limited to, physicians, dentists, medical residents 
or interns, hospital personnel and administrators, nurses, health care 
practitioners, chiropractors, osteopaths,

[[Page 90]]

pharmacists, optometrists, podiatrists, emergency medical technicians, 
ambulance drivers, alcohol or drug treatment personnel, psychologists, 
psychiatrists, mental health professionals, child care workers and 
administrators, and commercial film and photo processors. The Act 
defines the term ``child abuse'' as the physical or mental injury, 
sexual abuse or exploitation, or negligent treatment of a child.
    Accordingly, any person engaged in a covered profession or activity 
under an HHS contract or subcontract, regardless of the purpose of the 
contract or subcontract, shall immediately report a suspected child 
abuse incident in accordance with the provisions of the Act. If a child 
is suspected of being harmed, the appropriate State Child Abuse Hotline, 
local child protective services (CPS), or law enforcement agency should 
be contacted. For more information about where and how to file a report, 
the Childhelp USA[supreg], National Child Abuse Hotline (1-800-4-A-
CHILD[supreg]) should be called. Any covered professional failing to 
make a timely report of such incident shall be guilty of a Class B 
misdemeanor.
    By acceptance of this contract or order, the Contractor agrees to 
comply with the requirements of the Act. The Act also applies to all 
applicable subcontracts awarded under this contract. Accordingly, the 
Contractor shall ensure that each of its employees, and any 
subcontractor staff, is made aware of, understand, and comply with the 
provisions of the Act.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-18  Crime Control Act--Requirement for background checks.

    Insert the following clause in all solicitations and resultant 
contracts and orders, regardless of dollar amount, for all child care 
services to children under the age of 18, including social services, 
health and mental health care, child (day) care, education (whether or 
not directly involved in teaching), and rehabilitative programs covered 
under the Crime Control Act of 1990 (Act):

 Crime Control Act of 1990--Requirement for Background Checks (JAN 2006)

    Public Law 101-647, also known as the Crime Control Act of 1990 
(Act), requires that all individuals involved with the provision of 
child care services to children under the age of 18 undergo a criminal 
background check. ``Child care services'' include, but are not limited 
to, social services, health and mental health care, child (day) care, 
education (whether or not directly involved in teaching), and 
rehabilitative programs. Any conviction for a sex crime, an offense 
involving a child victim, or a drug felony, may be grounds for denying 
employment or for dismissal of an employee providing any of the services 
listed above.
    The Contracting Officer will provide the necessary information to 
the Contractor regarding the process for obtaining the background check. 
The Contractor may hire a staff person provisionally prior to the 
completion of a background check, if at all times prior to the receipt 
of the background check during which children are in the care of the 
newly-hired person, the person is within the sight and under the 
supervision of a previously investigated staff person.
    By acceptance of this contract or order, the Contractor agrees to 
comply with the requirements of the Act. The Act also applies to all 
applicable subcontracts awarded under this contract. Accordingly, the 
Contractor shall ensure that each of its employees, and any 
subcontractor staff, is made aware of, understand, and comply with the 
provisions of the Act.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.270-19  Electronic information and technology accessibility.

    (a) The following clause shall be used in solicitations as provided 
in 339.201-70:

     Electronic and Information Technology Accessibility (JAN 2006)

    Section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 794d), as 
amended by Public Law 105-220 under Title IV (Rehabilitation Act 
Amendments of 1998) and the Architectural and Transportation Barriers 
Compliance Board Electronic and Information (EIT) Accessibility 
Standards (36 CFR part 1194), require that all EIT acquired must ensure 
that:
    (1) Federal employees with disabilities have access to and use of 
information and data that is comparable to the access and use by Federal 
employees who are not individuals with disabilities; and
    (2) Members of the public with disabilities seeking information or 
services from an agency have access to and use of information and data 
that is comparable to the access to and use of information and data by 
members of the public who are not individuals with disabilities.
    This requirement includes the development, procurement, maintenance, 
and/or use of EIT products/services; therefore, any proposal submitted 
in response to this solicitation must demonstrate compliance with the

[[Page 91]]

established EIT Accessibility Standards. Information about Section 508 
is available at http://www.section508.gov/.

                           (End of provision)

    (b) The following clause shall be used in contracts and orders as 
provided in 339.201-70:

     Electronic and Information Technology Accessibility (JAN 2006)

    Pursuant to Section 508 of the Rehabilitation Act of 1973 (29 U.S.C. 
794d) as amended by Public Law 105-220 under Title IV (Rehabilitation 
Act Amendments of 1998), all Electronic and Information Technology (EIT) 
developed, procured, maintained, and/or used under this contract shall 
be in compliance with the ``Electronic and Information Technology 
Accessibility Standards'' set forth by the Architectural and 
Transportation Barriers Compliance Board (also referred to as the 
``Access Board'') in 36 CFR part 1194. The complete text of Section 508 
Final Standards can be accessed at http://www.access-board.gov/sec508/
standards.htm.
    The standards applicable to this requirement are [identified in the 
Statement of Work/listed below]:

(Select the appropriate phrase within the brackets [ ] and complete if 
necessary and identify location of/provide complete list of applicable 
provisions. Use the Buy accessible wizard at http://
www.buyaccessible.gov if necessary or contact your Section 508 
Coordinator)

    Vendors may document conformance using [attached documentation/
industry-standard Voluntary Product Accessibility Template at http://
www.itic.org/archives/articles/20040506/
faq--voluntary--product--accessibility--
template--vpat.php] (select the appropriate phrase within the brackets [ 
]). Vendors should provide detailed information necessary for 
determining compliance, including defined contractor-incidental 
exceptions.

                             (End of clause)

[71 FR 76511, Dec. 20, 2006]



352.333-7001  Choice of Law (Overseas).

    As prescribed in 333.215-70, use the following clause:

                        Choice of Law (Overseas)

    This contract shall be construed and interpreted in accordance with 
the substantive laws of the United States of America. By the execution 
of this contract, the contractor expressly agrees to waive any rights to 
invoke the jurisdiction of local national courts where this contract is 
performed and agrees to accept the exclusive jurisdiction of the United 
States Armed Services Board of Contract Appeals and the United States 
Court of Federal Claims for hearing and determination of any and all 
disputes that may arise under the Disputes clause of this contract.

[70 FR 41, Jan. 3, 2005]



PART 353_FORMS--Table of Contents






                  Subpart 353.3_Illustrations of Forms

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4262, Jan. 17, 2001, unless otherwise noted.



353.370-674  Form HHS 674, Structured Approach Profit/Fee Objective.

    This form is available from local cost advisory personnel. For 
copies of the form, contact the Program Support Center at (301) 443-
6740.

[[Page 92]]



                    SUBCHAPTER T_HHS SUPPLEMENTATIONS





PART 370_SPECIAL PROGRAMS AFFECTING ACQUISITION--Table of Contents




 Subpart 370.1_Accessibility of Meetings, Conferences, and Seminars to 
                        Persons With Disabilities

Sec.
370.101 Policy.
370.102 Responsibilities.

      Subpart 370.2_Indian Preference in Employment, Training, and 
                      Subcontracting Opportunities

370.201 Statutory requirements.
370.202 Applicability.
370.203 Definitions.
370.204 Compliance enforcement.
370.205 Tribal preference requirements.

           Subpart 370.3_Acquisitions Involving Human Subjects

370.300 Scope of subpart.
370.301 Policy.
370.302 Types of assurances.
370.303 Notice to offerors.
370.304 Contract clause.

   Subpart 370.4_Acquisitions Involving the Use of Laboratory Animals

370.400 Scope of subpart.
370.401 Policy.
370.402 Assurances.
370.403 Notice to offerors.
370.404 Contract clause.

           Subpart 370.5_Acquisitions Under the Buy Indian Act

370.500 Scope of subpart.
370.501 Policy.
370.502 Definitions.
370.503 Requirements.
370.504 Competition.
370.505 Responsibility determinations.

    Authority: 5 U.S.C. 301; 40 U.S.C. 486(c).

    Source: 66 FR 4262, Jan. 17, 2001, unless otherwise noted.



 Subpart 370.1_Accessibility of Meetings, Conferences, and Seminars to 
                        Persons With Disabilities



370.101  Policy.

    (a) It is the policy of HHS that all meetings, conferences, and 
seminars be accessible to persons with disabilities. For the purpose of 
this policy, accessibility is defined as both physical access to 
meeting, conference, and seminar sites, and aids and services to enable 
individuals with sensory disabilities to fully participate in meetings, 
conferences, and seminars.
    (b) In regard to acquisition, the policy is applicable to all 
contracts where the statement of work requires the contractor to conduct 
meetings, conferences, or seminars that are open to the public or 
involve HHS personnel, but not to ad hoc meetings that may be necessary 
or incidental to contract performance.



370.102  Responsibilities.

    (a) The Contracting Officer shall include the clause in 352.270-1 in 
every solicitation and resulting contract when the statement of work 
requires the contractor to conduct meetings, conferences, or seminars in 
accordance with 370.101(b).
    (b) The Project Officer shall be responsible for obtaining, 
reviewing, and approving the contractor's plan, which is to be submitted 
in response to paragraph (a) of the contract clause in 352.270-1. A 
consolidated or master plan for contracts requiring numerous meetings, 
conferences, or seminars will be acceptable. The Project Officer, prior 
to approving the plan, should consult with the OPDIV or other designated 
organization responsible for ensuring compliance with the Architectural 
Barriers Act of 1968 and the Americans with Disabilities Act of 1990 to 
ensure that the contractor's plan meets the accessibility requirements 
of the contract clause. The Project Officer shall ask the responsible 
organization to review, and determine the adequacy of, the contractor's 
plan, and respond to the Project Officer, in writing, within ten (10) 
working days of receiving the request from the Project Officer.

[71 FR 76514, Dec. 20, 2006]

[[Page 93]]



      Subpart 370.2_Indian Preference in Employment, Training, and 
                      Subcontracting Opportunities



370.201  Statutory requirements.

    Section 7(b) of the Indian Self-Determination and Education 
Assistance Act, Public Law 93-638, 88 Stat. 2205, 25 U.S.C. 450e(b), 
requires:

    ``Any contract, subcontract, grant, or subgrant pursuant to this 
Act, the Act of April 16, 1934 (48 Stat. 596), as amended, or any other 
Act authorizing Federal contracts with or grants to Indian organizations 
or for the benefit of Indians, shall require that to the greatest extent 
feasible:
    (1) Preferences and opportunities for training and employment in 
connection with the administration of such contracts or grants shall be 
given to Indians; and
    (b) Preference in the award of subcontracts and subgrants in 
connection with the administration of such contracts or grants shall be 
given to Indian organizations and to Indian-owned economic enterprises 
as defined in section 3 of the Indian Financing Act of 1974 (88 Stat. 
77).''



370.202  Applicability.

    The Indian Preference clause set forth in 352.270-2 and the Indian 
Preference Program clause set forth in 352.270-3 have been developed to 
implement section 7 (b) of Public Law 93-638 for all activities of the 
Department. The clauses shall be used by any affected departmental 
contracting activity as follows, except solicitations issued and 
contracts awarded pursuant to Title I of Public Law 93-638 (25 U.S.C. 
450 et seq.) are exempted:
    (a) The Indian Preference clause (352.270-2) shall be included in 
each solicitation and resultant contract, regardless of dollar amount:
    (1) When the contract is to be awarded pursuant to an act 
specifically authorizing contracts with Indian organizations; or
    (2) Where the work to be performed under the contract is 
specifically for the benefit of Indians and is in addition to any 
incidental benefits which might otherwise accrue to the general public.
    (b) The Indian Preference Program clause (352.270-3) shall be 
included in each solicitation and resultant contract when:
    (1) The dollar amount of the acquisition is expected to equal or 
exceed $50,000 for nonconstruction work or $100,000 for construction 
work;
    (2) The Indian Preference clause is to be included in the 
solicitation and resultant contract; and
    (3) The determination is made, prior to solicitation, that the work 
to be performed under the resultant contract will take place in whole or 
in substantial part on or near an Indian reservation(s). In addition, 
the Indian Preference Program clause may be included in any solicitation 
and resultant contract below the $50,000 or $100,000 level for 
nonconstruction or construction contracts, respectively, but which meet 
the requirements of paragraphs (b)(2) and (3) of this section 370.202, 
and, in the opinion of the contracting activity, offer substantial 
opportunities for Indian employment, training, and subcontracting.



370.203  Definitions.

    For purposes of this subpart 370.2, the following definitions shall 
apply:
    (a) Indian means a person who is a member of an Indian Tribe. If the 
contractor has reason to doubt that a person seeking employment 
preference is an Indian, the contractor shall grant the preference but 
shall require the individual to provide evidence within thirty (30) days 
from the Tribe concerned that the person is a member of the Tribe.
    (b) Indian Tribe means an Indian Tribe, pueblo, band, nation, or 
other organized group or community, including any Alaska Native Village 
or regional or village corporation as defined in or established pursuant 
to the Alaska Native Claims Settlement Act (85 Stat. 688, 43 U.S.C. 
1601) which is recognized as eligible for the special programs and 
services provided by the United States to Indians because of their 
status as Indians.
    (c) Indian organization means the governing body of any Indian Tribe 
or entity established or recognized by such governing body in accordance 
with the Indian Financing Act of 1974 (88 Stat. 77, 25 U.S.C. 1451).
    (d) Indian-owned economic enterprise means any Indian-owned 
commercial, industrial, or business activity established or organized 
for the purpose of

[[Page 94]]

profit, provided that such Indian ownership shall constitute not less 
than 51 percent of the enterprise, and the ownership shall encompass 
active operation and control of the enterprise.
    (e) Indian reservation includes Indian reservations, public domain 
Indian allotments, former Indian reservations in Oklahoma, and land held 
by incorporated Native groups, regional corporations, and village 
corporations under the provisions of the Alaska Native Claims Settlement 
Act (85 Stat. 688, 43 U.S.C. 1601 et seq.)
    (f) On or near an Indian Reservation means on a reservation or 
reservations or within that area surrounding an Indian reservation(s) 
where a person seeking employment could reasonably be expected to 
commute to and from in the course of a work day.



370.204  Compliance enforcement.

    (a) The concerned contracting activity shall be responsible for 
conducting periodic reviews to insure contractor compliance with the 
requirements of the clauses set forth in 352.270-2 and 352.270-3. These 
reviews may be conducted with the assistance of the Indian Tribe(s) 
concerned.
    (b) Complaints of noncomplaince with the requirements of the clauses 
set forth in 352.270-2 and 352.270-3 which are filed in writing with the 
contracting activity shall be promptly investigated and resolved by the 
contracting officer.



370.205  Tribal preference requirements.

    (a) Where the work under a contract is to be performed on an Indian 
reservation, the contracting activity may supplement the clause set 
forth in 352.270-3 by adding specific Indian preference requirements of 
the Tribe on whose reservation the work is to be performed. The 
supplemental requirements shall be jointly developed for the contract by 
the contracting activity and the Tribe. Supplemental preference 
requirements must represent a further implementation of the requirements 
of section 7(b) of Public Law 93-638 and must be approved by the 
affected program director and approved for legal sufficiency by the 
General Law Division, OGC, or a regional attorney before being added to 
a solicitation and resultant contract. Any supplemental preference 
requirements to be added to the clause in 352.270-3 shall be included in 
the solicitation and clearly identified in order to insure uniform 
understanding of the additional requirements by all prospective bidders 
or offerors.
    (b) Nothing in this part shall be interpreted to preclude Tribes 
from independently developing and enforcing their own tribal preference 
requirements. Such independently developed tribal preference 
requirements shall not, except as provided in paragraph (a) of this 
section, become a requirement in contracts covered under this subpart 
370.2, and must not conflict with any Federal statutory or regulatory 
requirement concerning the award and administration of contracts.

[66 FR 4262, Jan. 17, 2001, as amended at 71 FR 76514, Dec. 20, 2006]



           Subpart 370.3_Acquisitions Involving Human Subjects



370.300  Scope of subpart.

    This subpart applies to all research and development activities 
involving human subjects conducted under contract (see 45 CFR 46.102(d) 
and (f)).



370.301  Policy.

    It is the policy of the Department of Health and Human Services 
(HHS) that no contract involving human subjects shall be awarded until 
acceptable assurance has been given that the activity will be subject to 
initial and continuing review by an appropriate Institutional Review 
Board (IRB) as described in HHS regulations at 45 CFR 46.103. An 
applicable Federalwide Assurance (FWA), approved by the HHS Office of 
Human Research Protections (OHRP), shall be required of each contractor, 
subcontractor, or cooperating institution having responsibility for 
human subjects involved in performance of the contract. The HHS OHRP is 
responsible for negotiating assurances covering all HHS-supported or 
HHS-conducted activities involving human subjects. OHRP shall guide 
Contracting Officers regarding nonaward or termination of a contract due 
to inadequate

[[Page 95]]

assurance or breach of assurance for protection of human subjects.

[71 FR 76514, Dec. 20, 2006]



370.302  Types of assurances.

    (a) In January 2005, OHRP announced that the FWA would be the only 
new type of assurance accepted for review and approval by OHRP. 
Institutions holding an OHRP-approved Multiple Project Assurance (MPA) 
or Cooperative Project Assurance (CPA) were required to submit an FWA to 
OHRP for approval by December 31, 2005, if the institution is required 
to have an OHRP-approved assurance of compliance. Any Inter-
Institutional Amendment between an OHRP-approved MPA and an affiliate 
institution will be deactivated on January 1, 2006 if the affiliate 
institution has not obtained its own FWA. Single Project Assurances 
(SPAs) currently approved by OHRP will remain in effect for the duration 
of the project and through all non-competitive award renewals. An FWA 
listed in OHRP's current ``List of Registered Institutional Review 
Boards (IRBs)/Independent Ethics Committees (IECs) and Approved 
Assurances'' is acceptable for the purposes of this policy. The list may 
be found at http://ohrp.cit.nih.gov/search/asearch.asp.
    (b) The OHRP Web site includes links to instructions and the forms 
for submitting both a domestic and international FWA at http://
www.hhs.gov/ohrp/assurances/assurances--index.html. To expedite the 
approval of a FWA, as well as any update/renewal, the institution shall 
use the OHRP Electronic Submission System. Once an electronic file is 
``submitted'' to OHRP, the institution must fax or mail (do not do both) 
a copy of the signature page to initiate the review process. FWAs shall 
be mailed to the OHRP, U.S. Department of Health and Human Services, 
1101 Wootton Parkway, Suite 200, Rockville, Maryland 20852, or faxed to 
OHRP at 240-453-8202 (do not do both).

[71 FR 76514, Dec. 20, 2006]



370.303  Notice to offerors.

    (a) Solicitations shall contain the notice to offerors in 352.270-
8(a) whenever contract performance is expected to involve human 
subjects.
    (b) IRB approval of proposals submitted by institutions having an 
OHRP-approved FWA should be certified in the manner required by 
instructions for completion of the contract proposal; or by completion 
of an OMB Form No. 0990-0263, ``Protection of Human Subjects Assurance 
Identification/IRB Certification/Declaration of Exemption (Common Rule); 
or by letter indicating the institution's OHRP-assigned FWA number, the 
date of IRB review and approval, and the type of review (convened or 
expedited). The date of IRB approval must not be more than 12 months 
prior to the deadline for proposal submission.
    (c) FWAs for contractors, subcontractors, or cooperating 
institutions generally will not be requested prior to determination that 
a contract proposal has been selected for negotiation. When an FWA is 
submitted, it provides certification for the initial contract period. No 
additional documentation is required. If the contract provides for 
additional years to complete the project, the noncompetitive renewal 
proposal shall be certified in the manner described in the preceding 
paragraph.

[71 FR 76515, Dec. 20, 2006]



370.304  Contract clause.

    The clause set forth in 352.270-8(b) shall be inserted in all 
solicitations and resultant contracts involving human subjects.



   Subpart 370.4_Acquisitions Involving the Use of Laboratory Animals



370.400  Scope of subpart.

    This subpart applies to all research, research training and 
biological testing activities involving live vertebrate animals 
conducted under contract (see Public Health Service Policy on Humane 
Care and Use of Laboratory Animals (PHS Policy), Rev. 1986, Repr. 1996).



370.401  Policy.

    (a) It is the policy of the Department of Health and Human Services 
(HHS) that no contract involving live vertebrate animals shall be 
awarded

[[Page 96]]

until acceptable assurance has been given that the activity will be 
subject to initial and continuing review by an appropriate Institutional 
Animal Care and Use Committee (IACUC) as described in the PHS Policy at 
IV.B.6. and 7. An applicable Full Animal Welfare Assurance or 
Interinstitutional Agreement/Assurance, approved by the Office of 
Laboratory Animal Welfare (OLAW), National Institutes of Health (NIH), 
shall be required of each contractor, subcontractor, or cooperating 
institution having responsibility for animal care and use involved in 
performance of the contract (see PHS Policy II., IV.A., and V.B.).
    (b) The OLAW, NIH, is responsible for negotiating assurances 
covering all HHS/PHS-supported or HHS/PHS-conducted activities involving 
the care and use of live vertebrate animals. OLAW shall guide 
Contracting Officers regarding adequate animal care, and use, approval, 
disapproval, restriction, or withdrawal of approval of assurances (see 
PHS Policy V.A.).

[71 FR 76515, Dec. 20, 2006]



370.402  Assurances.

    (a) Assurances may be one of two types:
    (1) Full Animal Welfare Assurance (AWA). An AWA describes the 
institution's complete program for the care and use of animals, 
including but not limited to the facilities, occupational health, 
training, veterinary care, IACUC procedures and lines of authority and 
responsibility. An AWA listed in OLAW's list of institutions which have 
an approved full AWA will be considered acceptable for purposes of this 
policy.
    (2) Interinstitutional Agreement/Assurance (IAA). An IAA describes 
the arrangements between an offeror and usually a subcontractor where 
animal activities will occur. An IAA is limited to the specific award or 
single project.
    (b) The Contracting Officer shall forward copies of proposals 
selected for negotiation and requiring an assurance to the Assurance 
Branch, Office of Laboratory Animal Welfare (OLAW), NIH MSC 7507, 6100 
Executive Blvd., Room 3B01, Rockville, Maryland 20892, as early as 
possible to secure the necessary assurances.
    (c) A contractor providing animal care services at an assured 
entity, such as a Government-owned, contractor-operated (GOCO) site, 
does not need a separate assurance because the GOCO site normally covers 
the contractor services in the GOCO site assurance.

[71 FR 76515, Dec. 20, 2006]



370.403  Notice to offerors.

    Solicitations shall contain the notice to offerors in 352.270-9(a) 
whenever contract performance is expected to involve the use of live 
vertebrate animals.
    (a) For offerors having a full AWA on file with OLAW, IACUC approval 
of the use of animals shall be submitted in the manner required by 
instructions for completion of the contract proposal, but prior to the 
technical review of the proposal. The date of IACUC review and approval 
must not be more than 36 months prior to the deadline for proposal 
submission.
    (b) Non-assured offerors are not required to submit assurances or 
IACUC approval with proposals. OLAW will contact contractors, 
subcontractors and cooperating institutions to negotiate necessary 
assurances and verify IACUC approvals when requested by appropriate HHS/
PHS staff.

[71 FR 76515, Dec. 20, 2006]



370.404  Contract clause.

    The clause set forth in 352.270-9(b) shall be included in all 
solicitations and resultant contracts involving the care and use of live 
vertebrate animals.



           Subpart 370.5_Acquisitions Under the Buy Indian Act



370.500  Scope of subpart.

    This subpart sets forth the policy on preferential acquisition from 
Indians under the negotiation authority of the Buy Indian Act. 
Applicability of this subpart is limited to acquisitions made by or on 
behalf of the Indian Health Service of the Public Health Service.



370.501  Policy.

    (a) The Indian Health Service will utilize the negotiation authority 
of the Buy Indian Act to give preference to

[[Page 97]]

Indians whenever the use of that authority is authorized and is 
practicable. The Buy Indian Act, 25 U.S.C. 47, prescribes the 
application of the advertising requirements of section 3709 of the 
Revised Statutes to the acquisition of Indian supplies. As set out in 25 
U.S.C. 47, the Buy Indian Act provides as follows:

    So far as may be practicable Indian labor shall be employed, and 
purchases of the products (including, but not limited to printing, 
notwithstanding any other law) of Indian industry may be made in open 
market in the discretion of the Secretary of the Interior.

    (b) The functions, responsibilities, authorities, and duties of the 
Secretary of the Interior for maintenance and operation of hospital and 
health facilities for Indians and for the conservation of the health of 
Indians are transferred to the Surgeon General of the United States 
under the supervision of the Secretary of Health and Human Services, 42 
U.S.C. 2001 (a). Accordingly, the Secretary of Health and Human Services 
is authorized to use the Buy Indian Act in the acquisition of products 
of Indian industry in connection with the maintenance and operation of 
hospital and health facilities for Indians and for the conservation of 
the health of Indians. This authority has been delegated exclusively to 
the Indian Health Service and is not available for use by any other HHS 
component (unless that component is making an acquisition on behalf of 
the Indian Health Service).
    (c) Use of the Buy Indian Act negotiation authority has been 
emphasized in subsequent legislation, particularly Public Law 94-437 and 
Public Law 96-537.



370.502  Definitions.

    Buy Indian contract means any contract involving activities covered 
by the Buy Indian Act that is negotiated under the provisions of 41 
U.S.C. 252(c) and 25 U.S.C. 47 between an Indian firm and a contracting 
officer representing the Indian Health Service.
    Indian means a member of any tribe, pueblo, band, group, village or 
community that is recognized by the Secretary of the Interior as being 
Indian or any individual or group of individuals that is recognized by 
the Secretary of the Interior or the Secretary of Health and Human 
Services. The Secretary of Health and Human Services in making 
determinations may take into account the determination of the tribe with 
which affiliation is claimed.
    Indian firm means a sole enterprise, partnership, corporation, or 
other type of business organization owned, controlled, and operated by 
one or more Indians (including, for the purpose of sections 301 and 302 
of Public Law 94-437, former or currently federally recognized Indian 
tribes in the State of New York) or by an Indian firm; or a nonprofit 
firm organized for the benefit of Indians and controlled by Indians (see 
370.503(a)).
    Product of Indian industry means anything produced by Indians 
through physical labor or by intellectual effort involving the use and 
application of skills by them.



370.503  Requirements.

    (a) Indian ownership. The degree of Indian ownership of an Indian 
firm shall be at least 51 percent during the period covered by a Buy 
Indian contract.
    (b) Joint ventures. An Indian firm may enter into a joint venture 
with other entities for specific projects as long as the Indian firm is 
the managing partner. However, the joint venture must be approved by the 
contracting officer prior to the award of a contract under the Buy 
Indian Act.
    (c) Bonds. In the case of contracts for the construction, 
alteration, or repair of public buildings or public works, performance 
and payment bonds are required by the Miller Act (40 U.S.C. 270a-270f) 
and FAR part 28. In the case of contracts with Indian tribes or public 
nonprofit organizations serving as governmental instrumentalities of an 
Indian tribe, bonds are not required. However, bonds are required when 
dealing with private business entities which are owned by an Indian 
tribe or members of an Indian tribe. Bonds may be required of private 
business entities which are joint ventures with, or subcontractors of, 
an Indian tribe or a public nonprofit organization serving as a 
governmental instrumentality of an Indian tribe. A bid guarantee or bid

[[Page 98]]

bond is required only when a performance or payment bond is required.
    (d) Indian preference in employment, training and subcontracting. 
Contracts awarded under the Buy Indian Act are subject to the 
requirements of section 7(b) of the Indian Self-Determination and 
Education Assistance Act 25 U.S.C. 450e, which requires that preference 
be given to Indians in employment, training, and subcontracting. The 
Indian Preference clause set forth in 352.270-2 shall be included in all 
Buy Indian solicitations and resultant contracts. The Indian Preference 
Program clause set forth in 352.270-3 shall be used as specified in 
370.202(b). All requirements set forth in subpart 370.2 which are 
applicable to the instant Buy Indian acquisition shall be followed by 
the contracting officer, e.g., sections 370.204 and 370.205.
    (e) Subcontracting. Not more than 50 percent of the work to be 
performed under a prime contract awarded pursuant to the Buy Indian Act 
shall be subcontracted to other than Indian firms. For this purpose, 
work to be performed does not include the provision of materials, 
supplies, or equipment.
    (f) Wage rates. A determination of the minimum wage rates by the 
Secretary of Labor as required by the Davis-Bacon Act (40 U.S.C. 276a) 
shall be included in all contracts awarded under the Buy Indian Act for 
over $2,000 for construction, alteration, or repair, including painting 
and decorating, of public buildings and public works, except contracts 
with Indian tribes or public nonprofit organizations serving as 
governmental instrumentalities of an Indian tribe. The wage rate 
determination is to be included in contracts with private business 
entities even if they are owned by an Indian tribe or a member of an 
Indian tribe and in connection with joint ventures with, or 
subcontractors of, an Indian tribe or a public nonprofit organization 
serving as a governmental instrumentality of an Indian tribe.



370.504  Competition.

    (a) Contracts awarded under the Buy Indian Act are subject to 
competition among Indians or Indian concerns to the maximum extent that 
the Contracting Officer determines is practicable. When competition is 
determined not to be practicable, a Justification for Other than Full 
and Open Competition shall be prepared in accordance with 306.303 and 
subsequently retained in the contract file.
    (b) Solicitations must be synopsized and publicized in FedBizOpps at 
http://www.fedbizopps.gov and copies of the synopses sent to the tribal 
office of the Indian tribal government directly concerned with the 
proposed acquisition as well as to Indian concerns and others having a 
legitimate interest. The synopsis must state that the acquisition is 
restricted to Indian firms under the Buy Indian Act.

[71 FR 76515, Dec. 20, 2006]



370.505  Responsibility determinations.

    (a) A contract may be awarded under the Buy Indian Act only if it is 
first determined that the project or function to be contracted for is 
likely to be satisfactorily performed under that contract and the 
project or function is likely to be properly completed or maintained 
under that contract.
    (b) The determination called for by paragraph (a) of this section, 
to be made prior to the award of a contract, will be made in writing by 
the contracting officer reflecting an analysis of the standards set 
forth in FAR 9.104-1.

[[Page 99]]



                  CHAPTER 4--DEPARTMENT OF AGRICULTURE




                           (Parts 400 to 499)

  --------------------------------------------------------------------

                          SUBCHAPTER A--GENERAL
Part                                                                Page
401             Agriculture Acquisition Regulation System...         101
402             Definitions of words and terms..............         106
403             Improper business practices and personal 
                    conflicts of interest...................         106
404             Administrative matters......................         108
           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING
405             Publicizing contract actions................         110
406             Competition requirements....................         110
407             Acquisition planning........................         111
408             Required sources of supplies and services...         112
409             Contractor qualifications...................         114
410             Market research.............................         116
411             Describing agency needs.....................         116
412             Acquisition of commercial items.............         117
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
413             Simplified acquisition procedures...........         119
414             Sealed bidding..............................         119
415             Contracting by negotiation..................         120
416             Types of contracts..........................         122
417             Special contracting methods.................         123
418

[Reserved]

                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
419             Small business programs.....................         124
420-421

[Reserved]

422             Application of labor laws to Government 
                    acquisitions............................         125
423             Environment, energy and water efficiency, 
                    renewable energy technologies, 
                    occupational safety, and drug-free 
                    workplace...............................         127
424             Protection of privacy and freedom of 
                    information.............................         129

[[Page 100]]

425             Foreign acquisition.........................         130
426             Other socioeconomic programs................         131
             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
427             Patents, data, and copyrights...............         132
428             Bonds and insurance.........................         132
429

[Reserved]

430             Cost Accounting Standards Administration....         133
431             Contract cost principles and procedures.....         134
432             Contract financing..........................         134
433             Protests, disputes and appeals..............         138
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
434             Major system acquisition....................         140
435             Research and development contracting........         141
436             Construction and architect-engineer 
                    contracts...............................         141
437             Service contracting.........................         144
438

[Reserved]

439             Acquisition of information technology.......         145
440

[Reserved]

441             Acquisition of utility services.............         146
                    SUBCHAPTER G--CONTRACT MANAGEMENT
442             Contract administration.....................         147
443-444

[Reserved]

445             Government property.........................         147
446             Quality assurance...........................         148
447             Transportation..............................         148
448

[Reserved]

449             Termination of contracts....................         149
450             Extraordinary contractual actions...........         149
451

[Reserved]

                     SUBCHAPTER H--CLAUSES AND FORMS
452             Solicitation provisions and contract clauses         151
453             Forms.......................................         161

[[Page 101]]



                          SUBCHAPTER A_GENERAL





PART 401_AGRICULTURE ACQUISITION REGULATION SYSTEM--Table of Contents




Sec.
401.000 Scope of part.

               Subpart 401.1_Purpose, Authority, Issuance

401.101 Purpose.
401.103 Authority.
401.104 Applicability.
401.105 Issuance.
401.105-1 Publication and code arrangement.
401.105-2 Arrangement of regulations.
401.105-3 Copies.
401.106 OMB approval under the Paperwork Reduction Act.
401.170 Electronic access to regulatory information.

                      Subpart 401.2_Administration

401.201 Maintenance of the FAR.
401.201-1 The two councils.

              Subpart 401.3_Agency Acquisition Regulations

401.301 Policy.
401.304 Agency control and compliance procedures.
401.370 Exclusions.
401.371 AGAR Advisories.
401.372 Departmental directives.

             Subpart 401.4_Deviations From the FAR and AGAR

401.402 Policy.
401.403 Individual deviations.
401.404 Class deviations.

        Subpart 401.6_Contracting Authority and Responsibilities

401.601 General.
401.602 Contracting officers.
401.602-3 Ratification of unauthorized commitments.
401.603 Selection, appointment, and termination of appointment.
401.603-1 General.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



401.000  Scope of part.

    This part presents basic policies and general information about the 
Department of Agriculture's (USDA) Acquisition Regulation, subsequently 
referred to as the AGAR. The AGAR is an integral part of the Federal 
Acquisition Regulations System.



               Subpart 401.1_Purpose, Authority, Issuance



401.101  Purpose.

    (a) The AGAR provides for the codification and publication of 
uniform policies and procedures for acquisitions by contracting 
activities within USDA.
    (b) The purpose of the AGAR is to implement the Federal Acquisition 
Regulation (FAR), where further implementation is needed, and to 
supplement the FAR when coverage is needed for subject matter not 
covered in the FAR. The AGAR is not by itself a complete document, as it 
must be used in conjunction with the FAR.



401.103  Authority.

    The AGAR and amendments thereto are issued under 5 U.S.C. 301 and 40 
U.S.C. 486(c). The Senior Procurement Executive (SPE) has the delegated 
authority to promulgate Departmental acquisition regulations.



401.104  Applicability.

    The FAR and AGAR apply to all USDA acquisitions of supplies and 
services (including construction) which obligate appropriated funds, 
unless otherwise specified in this chapter or excepted by law.



401.105  Issuance.



401.105-1  Publication and code arrangement.

    (a) The AGAR is codified in the Code of Federal Regulations (CFR) as 
Chapter 4 of Title 48, Federal Acquisition Regulations System, to 
implement and supplement Chapter 1 which constitutes the FAR. Parts 400 
through 499 have been assigned to USDA by the Office of the Federal 
Register.
    (b) The AGAR and its subsequent changes are published in:

[[Page 102]]

    (1) Daily issues of the Federal Register,
    (2) Cumulative form in the CFR, and,
    (3) Electronic form on the USDA Departmental Administration 
Procurement Homepage (see 401.170).
    (c) Section 553(a)(2) of the Administrative Procedure Act, 5 U.S.C. 
553, provides an exception from the standard public rulemaking 
procedures to the extent that the rule involves a matter relating to 
agency management or personnel or to public property, loans, grants, 
benefits, or contracts. In 1971, Secretary of Agriculture Hardin 
announced a voluntary partial waiver from the Administrative Procedure 
Act exception, and USDA agencies generally are required to provide 
notice and an opportunity for public comment on proposed rules (36 FR 
13804, July 24, 1971). The AGAR has been promulgated and may be revised 
from time to time in accordance with the rulemaking procedures of the 
Administrative Procedure Act. The USDA also is required to publish for 
public comment procurement regulations in the Federal Register, pursuant 
to the Office of Federal Procurement Policy Act (41 U.S.C. 418b), and 
FAR 1.301.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 44, Jan. 3, 2005]



401.105-2  Arrangement of regulations.

    AGAR coverage parallels the FAR in format, arrangement, and 
numbering system. However, subdivisions below the section and subsection 
levels may not always correlate directly to FAR designated paragraphs 
and subparagraphs.



401.105-3  Copies.

    Copies of the AGAR published in CFR form may be purchased from the 
Superintendent of Documents, Government Printing Office, Washington, 
D.C. 20402. Requests should reference Chapter 4 of Title 48 CFR.



401.106  OMB approval under the Paperwork Reduction Act.

    The following OMB control numbers apply to USDA solicitations and 
specified information collections within the AGAR:

------------------------------------------------------------------------
                                                             OMB Control
                        AGAR segment                             No.
------------------------------------------------------------------------
411.170....................................................    0505-0014
415.2......................................................    0505-0013
436.575....................................................    0505-0011
437.110....................................................    0505-0015
437.270....................................................    0505-0016
452.211-1..................................................    0505-0014
452.215-71.................................................    0505-0013
452.236-75.................................................    0505-0011
452.237-74.................................................    0505-0015
452.237-76.................................................    0505-0016
------------------------------------------------------------------------


[61 FR 53646, Oct. 15, 1996, as amended at 64 FR 52674, Sept. 30, 1999]



401.170  Electronic access to regulatory information.

    The USDA Departmental Administration Procurement Homepage provides 
access to the AGAR, AGAR amendments (circulars), AGAR Advisories, and 
other USDA procurement policy and guidance in electronic form. The 
Internet address for the Procurement Homepage is URL http://
www.usda.gov/procurement/.

[63 FR 26994, May 15, 1998, as amended at 70 FR 44, Jan. 3, 2005]



                      Subpart 401.2_Administration



401.201  Maintenance of the FAR.



401.201-1  The two councils.

    (a) USDA's representative on the Civilian Agency Acquisition Council 
is designated by the SPE.
    (b) The Procurement Policy Division will coordinate proposed FAR 
revisions within USDA.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 44, Jan. 3, 2005]



              Subpart 401.3_Agency Acquisition Regulations



401.301  Policy.

    (a) The SPE, subject to the authorities in 401.103 and FAR 1.301, 
may issue and publish Departmental regulations, that together with the 
FAR, constitute Department-wide policies, procedures, solicitation 
provisions, and contract clauses governing the contracting process or 
otherwise controlling the relationship between USDA (including any of 
its contracting activities) and contractors or prospective contractors.

[[Page 103]]

    (b) Each designated head of a contracting activity (HCA) is 
authorized to issue or authorize the issuance of, at any organizational 
level, internal guidance which does not have a significant effect beyond 
the internal operating procedures of the activity, or a significant cost 
or administrative impact on offerors or contractors. Internal guidance 
issued by contracting activities will not be published in the Federal 
Register. HCA's shall ensure that the guidance, procedures, or 
instructions issued--
    (1) Are consistent with the policies and procedures contained in 
this chapter;
    (2) Follow the format, arrangement, and numbering system of this 
chapter to the extent practicable;
    (3) Contain no material which duplicates, paraphrases, or is 
inconsistent with this chapter; and
    (4) Are numbered and identified by use of alphabetical suffixes to 
the chapter number as follows:

4A [Reserved]
4B Agricultural Research Service.
4C Farm Service Agency.
4D Rural Development (mission area).
4E Food Safety and Inspection Service.
4F [Reserved]
4G Forest Service.
4H [Reserved]
4I Natural Resources Conservation Service.
4J [Reserved]
4K Food and Nutrition Service.
4L Animal and Plant Health Inspection Service.
4M [Reserved]
4N Departmental Administration.
4O-4P [Reserved]
4R Office of Inspector General.
4S [Reserved]

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 44, Jan. 3, 2005]



401.304  Agency control and compliance procedures.

    (a) The AGAR System is under the direct oversight and control of the 
SPE, who is responsible for review and issuance of all Department-wide 
acquisition regulations published in the Federal Register to assure 
compliance with FAR part 1.
    (b) The SPE is also responsible for review and issuance of 
unpublished, Department-wide internal guidance under the AGAR System.
    (c) HCA's are responsible for establishment and implementation of 
formal procedures for oversight and control of unpublished internal 
guidance issued within the contracting activity to implement FAR or AGAR 
requirements. These procedures shall be subject to the review and 
approval by the SPE.
    (d) The SPE is responsible for evaluating coverage under the AGAR 
System to determine applicability to other agencies and for recommending 
coverage to the FAR Secretariat for inclusion in the FAR.
    (e) Recommendations for revision of existing FAR coverage or new FAR 
coverage shall be submitted by the HCA to the SPE for further action.



401.370  Exclusions.

    Subject to the policies of FAR subpart 1.3, certain USDA acquisition 
policies and procedures may be excluded from the AGAR under 
appropriately justified circumstances, such as:
    (a) Subject matter which is effective for a period less than 12 
months.
    (b) Subject matter which is instituted on an experimental basis for 
a reasonable period.
    (c) Acquisition procedures instituted on an interim basis to comply 
with the requirements of statute, regulation, Executive Order, OMB 
Circular, or OFPP Policy Letter.



401.371  AGAR Advisories.

    The SPE may issue AGAR Advisories, consistent with the policies of 
the FAR and the AGAR, for the following purposes:
    (a) To communicate Department-wide policy and/or procedural guidance 
to contracting activities;
    (b) To delegate to procurement officials authority to make 
determinations or to take action to implement the policies of the FAR or 
the AGAR; and,
    (c) To establish internal policy and procedures on an interim basis, 
prior to incorporation in the AGAR or in a Departmental Directive.
    (d) AGAR Advisories are only available in electronic format on the 
USDA

[[Page 104]]

Procurement Web site at http://www.usda.gov/procurement/.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 44, Jan. 3, 2005]



401.372  Departmental directives.

    Subject to the policies of FAR 1.3, USDA from time to time may issue 
internal directives to establish procedures, standards, guidance, or 
methods of performing duties, functions, or operations. Such directives 
include Departmental Regulations (DR's), Departmental Notices, and 
Secretary's Memoranda.



             Subpart 401.4_Deviations From the FAR and AGAR



401.402  Policy.

    Requests for authority to deviate from the provisions of the FAR or 
the AGAR shall be submitted in writing as far in advance as the 
exigencies of the situation will permit. Each request for deviation 
shall contain the following:
    (a) A statement of the deviation desired, including identification 
of the specific paragraph number(s) of the FAR and AGAR;
    (b) The reason why the deviation is considered necessary or would be 
in the best interest of the Government;
    (c) If applicable, the name of the contractor and identification of 
the contract affected;
    (d) A statement as to whether the deviation has been requested 
previously and, if so, circumstances of the previous request;
    (e) A description of the intended effect of the deviation;
    (f) A statement of the period of time for which the deviation is 
needed; and
    (g) Any pertinent background information which will contribute to a 
full understanding of the desired deviation.



401.403  Individual deviations.

    In individual cases, deviations from either the FAR or the AGAR will 
be authorized only when essential to effect a necessary acquisition or 
where special circumstances make such deviations clearly in the best 
interest of the Government. Except for cost principles, HCA's may 
approve individual deviations from the AGAR, after coordinating with the 
General Counsel and the SPE. No deviations from the FAR or AGAR may be 
authorized at the contracting office level. A copy of each deviation and 
its supporting documentation shall be provided to the SPE. Deviations 
from the FAR shall not be made unless such action is authorized by the 
SPE after consultation with the Office of the General Counsel and any 
other appropriate office, on the basis of a written justification 
stating clearly the special circumstances involved.



401.404  Class deviations.

    Where deviations from the FAR or AGAR are considered necessary for 
classes of contracts, requests for authority to deviate shall be 
submitted in writing to the SPE for approval. The SPE may authorize 
class deviations from the FAR without consulting the Chairperson of the 
Civilian Agency Acquisition Council where urgency precludes 
consultation. The SPE shall subsequently inform the Chairperson of the 
Civilian Agency Acquisition Council of the deviation including the 
circumstances under which it was required.



        Subpart 401.6_Contracting Authority and Responsibilities



401.601  General.

    (a) The authority and responsibility vested in the Secretary to 
manage USDA's acquisition function is delegated through the Assistant 
Secretary for Administration to the SPE. This broad authority includes, 
but is not limited to, the following responsibilities:
    (1) Prescribing and publishing Departmental acquisition policies, 
regulations, and procedures.
    (2) Taking any necessary actions consistent with policies, 
regulations, and procedures with respect to purchases, contracts, 
leases, and other transactions.
    (3) Designating contracting officers.
    (4) Establishing clear lines of contracting authority.
    (5) Evaluating and monitoring the performance of USDA's acquisition 
system.

[[Page 105]]

    (6) Managing and enhancing career development of the contracting 
work force.
    (7) Participating in the development of Government-wide acquisition 
policies, regulations, and standards; and determining specific areas 
where government-wide performance standards should be established and 
applied.
    (8) Determining areas of Department-unique standards and developing 
unique Department-wide standards.
    (9) Certifying to the Secretary that the acquisition system meets 
approved standards.
    (b) The SPE may delegate contracting authority to the Heads of 
Contracting Activities (HCA's) and the responsibility to manage their 
acquisition function.
    (c) Unless prohibited by the FAR, the AGAR, or by other applicable 
statutes and regulations, the SPE may redelegate to HCA's the authority 
to make determinations as the agency head in order to implement the 
policies and procedures of the FAR. Such delegations shall be in 
writing, but need not be published.
    (d) Unless prohibited by the FAR, the AGAR, or by other applicable 
statutes or regulations, each HCA may designate one individual from the 
contracting activity to carry out the functions of the HCA (HCAD). The 
HCAD may exercise all authority delegated to the HCA.



401.602  Contracting officers.



401.602-3  Ratification of unauthorized commitments.

    (a) Definitions. Ratification, as used in this section, means the 
signed, documented action taken by an authorized official to approve and 
sanction a previously unauthorized commitment.
    Unauthorized commitment, as used in this section, means an agreement 
made by a Government representative who lacked the authority to enter 
into a contract on behalf of the Government.
    (b) Policy. The HCA may delegate ratification authority to the chief 
of the contracting office.
    (c) Procedure. Whenever an official of the cognizant contracting 
activity who is authorized to ratify unauthorized commitments learns 
that a person or firm has assumed work as a result of an unauthorized 
commitment, that official shall take the following actions:
    (1) Immediately inform any person who is performing work as a result 
of an unauthorized commitment that the work is being performed at that 
person's risk;
    (2) Inform the individual who made the unauthorized commitment of 
the seriousness of the act and the possible consequences;
    (3) Ensure that the individual who made the unauthorized commitment 
furnishes all records and documents concerning the commitment and a 
complete, written statement of facts, including, but not limited to: a 
statement as to why a contracting officer was not used; why the vendor 
was selected and a list of sources considered; a description of work to 
be performed or products to be furnished; the estimated or agreed price; 
whether an appropriation is available for the work; and whether 
performance has begun. Under exceptional circumstances, such as when the 
individual who made the unauthorized commitment is no longer available 
to attest to the circumstances of the unauthorized commitment, the 
ratifying official may waive these requirements; and
    (4) Decide whether ratification is proper and proceed as follows:
    (i) If ratification is not justifiable, provide the cognizant 
program office, contracting office, and the unauthorized contractor with 
an explanation of the decision not to ratify.
    (ii) If ratification appears adequately justified, ratify the action 
and retain or assign the contract to a successor contracting officer if 
necessary.
    (iii) Maintain related approval, decisional, and background 
documents in the contract file for audit purposes.
    (iv) Notify the cognizant program supervisor or line officer about 
the final disposition of the case; the notification may include a 
recommendation that the unauthorized commitment should be further 
considered a violation of USDA's employee conduct regulations.

[[Page 106]]



401.603  Selection, appointment, and termination of appointment.



401.603-1  General.

    An HCA may delegate contracting authority to the extent authorized 
by the SPE in a general delegation of acquisition authority, by 
appointing qualified individuals as contracting officers, in accordance 
with the USDA Contracting Officer Warrant System, Departmental 
Regulation 5001-1.



PART 402_DEFINITIONS OF WORDS AND TERMS--Table of Contents




Sec.
402.000 Scope of part.

                        Subpart 402.1_Definitions

402.101 Definitions.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



402.000  Scope of part.

    As used throughout this chapter, the following words and terms are 
used as defined in this subpart unless the context in which they are 
used clearly requires a different meaning, or a different definition is 
prescribed for a particular part or portion of a part.



                        Subpart 402.1_Definitions



402.101  Definitions.

    Acquisition official means an individual who has been delegated 
authority to manage or to exercise acquisition functions and 
responsibilities.
    Agency head or Head of the Agency means the Secretary of 
Agriculture, Deputy Secretary, or the Assistant Secretary for 
Administration.
    Head of the contracting activity (HCA) means the official who has 
overall responsibility for managing the contracting activity (i.e., 
Chief, Forest Service; Administrator, Agricultural Research Service; 
etc.), or the individual designated by such an official to carry out the 
functions of the HCA.
    Senior Procurement Executive (SPE) means the agency official 
appointed as such by the head of the agency pursuant to Executive Order 
12931. The Director, Office of Procurement and Property Management, has 
been designated as the USDA SPE.

[61 FR 53646, Oct. 15, 1996, as amended at 63 FR 26994, May 15, 1998]



PART 403_IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents




                        Subpart 403.1_Safeguards

Sec.
403.101 Standards of conduct.
403.101-3 Agency regulations.
403.104 Procurement integrity.
403.104-5 [Reserved]
403.104-7 Violations or possible violations.

       Subpart 403.2_Contractor Gratuities to Government Personnel

403.203 Reporting suspected violations of the gratuities clause.
403.204 Treatment of violations.

         Subpart 403.3_Reports of Suspected Antitrust Violations

403.303 Reporting suspected antitrust violations.

                      Subpart 403.4_Contingent Fees

403.405 Misrepresentations or violations of the Covenant Against 
          Contingent Fees.

             Subpart 403.5_Other Improper Business Practices

403.502 Subcontractor kickbacks.

Subpart 403.6_Contracts With Government Employees or Organizations Owned 
                          or Controlled by Them

403.602 Exceptions.
403.603 Responsibilities of the contracting officer.

 Subpart 403.8_Limitation on the Payment of Funds To Influence Federal 
                              Transactions

403.806 Processing suspected violations

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.

[[Page 107]]



                        Subpart 403.1_Safeguards



403.101  Standards of conduct.



403.101-3  Agency regulations.

    (a) The standards of conduct for USDA procurement officials are the 
uniform standards established by the Office of Government Ethics in 5 
CFR Part 2635, Standards of Ethical Conduct for Employees of the 
Executive Branch, and FAR 3.104, Procurement integrity.
    (b) Procurement officials and other employees who require advice 
concerning the application of standards of conduct to any acquisition 
issue shall obtain ethics advisory opinions from ethics advisory 
officials in their agency personnel offices.



403.104  Procurement integrity.



403.104-5  [Reserved]



403.104-7  Violations or possible violations.

    The contracting officer shall forward information concerning any 
violation or possible violation of the Procurement Integrity Act (41 
U.S.C. 423) to the chief of the contracting office.

[61 FR 53646, Oct. 15, 1996, as amended at 63 FR 26995, May 15, 1998. 
Redesignated and amended at 70 FR 44, Jan. 3, 2005]



       Subpart 403.2_Contractor Gratuities to Government Personnel



403.203  Reporting suspected violations of the gratuities clause.

    A suspected violation of the contract clause, FAR 52.203-3, 
Gratuities, shall be reported immediately to the cognizant contracting 
officer in writing, stating the circumstances surrounding the 
incident(s), the date(s), and names of all parties involved. The 
contracting officer shall review the report for completeness, add any 
additional information deemed necessary and a recommendation for action, 
and submit the report to the HCA.



403.204  Treatment of violations.

    The HCA shall review the report and consult with the Offices of 
General Counsel and Inspector General to determine whether further 
action should be pursued. If it is found that the facts and 
circumstances warrant further action, the HCA shall give the contractor 
a formal written notice which summarizes the reported violation and 
affords the contractor the opportunity to make a written or oral 
response within a reasonable, specified period after receipt of the 
notice. The notice shall be sent by certified mail with return receipt 
requested. Oral presentations shall follow the procedures outlined in 
FAR 3.204(b). The HCA shall furnish copies of any adverse determination 
to the contracting officer and the Department Debarring Officer for 
their subsequent considerations under FAR 3.204(c)(1) and (2), 
respectively.



         Subpart 403.3_Reports of Suspected Antitrust Violations



403.303  Reporting suspected antitrust violations.

    Contracting officers shall report the circumstances of suspected 
violations of antitrust laws to the Office of Inspector General in 
accordance with procedures in Departmental Regulations (1700 series).



                      Subpart 403.4_Contingent Fees



403.405  Misrepresentations or violations of the Covenant Against Contingent Fees.

    (a) A suspected misrepresentation or violation of the Covenant 
Against Contingent Fees shall be documented in writing by the 
contracting officer and reported immediately to the chief of the 
contracting office. The chief of the contracting office shall determine 
if a violation has occurred and report any violation to the Office of 
Inspector General. The chief of the contracting office shall take action 
in accordance with FAR 3.405(b).
    (b) If the chief of the contracting office decides to refer the case 
to the Department of Justice, it should be referred through the Office 
of Inspector General with a copy of the report and referral submitted 
through the HCA to the Senior Procurement Executive.

[61 FR 53646, Oct. 15, 1996. Redesignated and amended at 70 FR 44, Jan. 
3, 2005]

[[Page 108]]



             Subpart 403.5_Other Improper Business Practices



403.502  Subcontractor kickbacks.

    Contracting officers shall report the circumstances of suspected 
violations of the Anti-Kickback Act (41 U.S.C. 51-58) to the Office of 
Inspector General in accordance with procedures in Departmental 
Regulations (1700 series).

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 44, Jan. 3, 2005]



Subpart 403.6_Contracts With Government Employees or Organizations Owned 
                          or Controlled by Them



403.602  Exceptions.

    The HCA is authorized to accept a contract from the policy in FAR 
3.601.



403.603  Responsibilities of the contracting officer.

    The contracting officer, when requesting authorization under 
403.602, shall prepare a written determination and findings for the 
signature of the HCA. The determination shall document compliance with 
FAR 3.603, specifying the compelling reason(s) for award, and shall be 
placed in the contract file.



 Subpart 403.8_Limitation on the Payment of Funds To Influence Federal 
                              Transactions



403.806  Processing suspected violations.

    Suspected violations of the requirements of 31 U.S.C. 1352 shall be 
referred to the Office of Inspector General in accordance with 
procedures in Departmental Regulations (1700 series).



PART 404_ADMINISTRATIVE MATTERS--Table of Contents




                   Subpart 404.2_Contract Distribution

Sec.
404.203 Taxpayer identification information.

    Subpart 404.4_Safeguarding Classified Information Within Industry

404.403 Responsibilities of contracting officers.

                    Subpart 404.6_Contract Reporting

404.601 [Reserved]
404.602 Federal Procurement Data System.

                 Subpart 404.8_Government Contract Files

404.870 Document numbering system.

             Subpart 404.11_Central Contractor Registration

404.1103 Procedures.

                   Subpart 404.70_Precontract Notices

404.7001 Solicitation provision.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                   Subpart 404.2_Contract Distribution



404.203  Taxpayer identification information.

    (a) If the contractor furnishes taxpayer identification number (TIN) 
and type of organization information pursuant to solicitation provision 
52.204-3 or 52.212-3, and the USDA Office of the Chief Financial 
Officer, Controller Operations Division, New Orleans will be the payment 
office, that information will be entered into the Foundation Financial 
Information System (FFIS) in accordance with FFIS Vendor Table 
Maintenance Procedures set forth in FFIS Bulletins issued by the Office 
of the Chief Financial Officer and AGAR Advisories issued by the Office 
of Procurement and Property Management.
    (b) Separate submission of the TIN or type of organization 
information, in accordance with 52.204-3 or 52.212-3, is not required 
for contractors registered in the Central Contractor Registration (CCR) 
database.

[70 FR 44, Jan. 3, 2005]

[[Page 109]]



    Subpart 404.4_Safeguarding Classified Information Within Industry



404.403  Responsibilities of contracting officers.

    When a proposed solicitation is likely to require access to 
classified information, the contracting officer shall consult with the 
Information Security Staff, Personnel and Document Security Division, 
Office of Procurement and Property Management, regarding the procedures 
that must be followed.

[70 FR 44, Jan. 3, 2005]



                    Subpart 404.6_Contract Reporting



404.601  [Reserved]



404.602  Federal Procurement Data System.

    (a) Contracting activities shall report contract actions into the 
Federal Procurement Data System in accordance with the instructions 
issued or distributed by the SPE.
    (b) The unique identifier for each contract action reported to the 
Federal Procurement Data System shall begin with the two-letter USDA 
Agency Prefix ``AG''.

[70 FR 44, Jan. 3, 2005]



                 Subpart 404.8_Government Contract Files



404.870  Document numbering system.

    The SPE shall issue AGAR Advisories to establish and maintain a 
numbering system for USDA contracts, modifications, and delivery/task 
orders. USDA contracting offices shall number contracts, modifications, 
and orders in accordance with this numbering system.

[70 FR 44, Jan. 3, 2005]



             Subpart 404.11_Central Contractor Registration



404.1103  Procedures.

    (a) Contracting officers and other USDA employees shall not enter 
information into the Central Contractor Registration (CCR) database on 
behalf of prospective contractors. Prospective contractors who are 
unable to register on-line at the CCR Web site should be advised to 
submit a written application to CCR for registration into the CCR 
database. USDA employees may assist prospective contractors by 
downloading the registration template, CCR handbook, and other 
information from the CCR Web site and providing copies of that material 
to requesters. Written applications for registration may be submitted to 
Department of Defense Central Contractor Registration, 74 Washington 
Ave., Suite 7, Battle Creek, MI 49017-3084.
    (b) Verification that the prospective contractor is registered in 
the CCR database shall be done via the CCR Internet Web site http://
www.ccr.gov. This verification process using the CCR Web site applies 
both to acquisitions executed using USDA legacy procurement systems and 
the USDA Integrated Acquisition System.
    (c) AGAR Advisories issued by the Office of Procurement and Property 
Management will address internal procedures for integration of 
contractor information in the CCR database with the USDA FFIS payment 
system.

[70 FR 44, Jan. 3, 2005]



                   Subpart 404.70_Precontract Notices



404.7001  Solicitation provision.

    The contracting officer shall insert the provision at 452.204-70, 
Inquiries, in all solicitations.

[[Page 110]]



            SUBCHAPTER B_COMPETITION AND ACQUISITION PLANNING





PART 405_PUBLICIZING CONTRACT ACTIONS--Table of Contents




                Subpart 405.3_Synopses of Contract Awards

Sec.
405.303 Announcement of contract awards.

                  Subpart 405.4_Release of Information

405.403 Requests from Members of Congress.
405.404 Release of long-range acquisition estimates.
405.404-1 Release procedures.

                    Subpart 405.5_Paid Advertisements

405.502 Authority.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                Subpart 405.3_Synopses of Contract Awards



405.303  Announcement of contract awards.

    Contracting officers shall make information available on any 
contract award with an estimated total value over $1 million (including 
options) to their agency congressional liaison office in sufficient time 
for the agency to announce it by 5:00 p.m. Washington, DC time on the 
day of award. The agency congressional liaison office shall, concurrent 
with the public announcement, provide the award announcement information 
to the USDA Congressional Relations Office.



                  Subpart 405.4_Release of Information



405.403  Requests from Members of Congress.

    The head of the contracting activity (HCA) is the agency head 
designee pursuant to FAR 5.403.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 45, Jan. 3, 2005]



405.404  Release of long-range acquisition estimates.



405.404-1  Release procedures.

    (a) HCA's shall establish written procedures to control the release 
of long-range acquisition estimates, as authorized under FAR 5.404-1.
    (b) Classified information shall not be released without the 
approval of the Information Security Staff, Personnel and Document 
Security Division, Office of Procurement and Property Management. 
Departmental Manuals and Regulations (3400 series) contain guidance on 
classified information.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 45, Jan. 3, 2005]



                    Subpart 405.5_Paid Advertisements



405.502  Authority.

    (a) The authority vested in the agency head to authorize publication 
of paid advertisements in newspapers (44 U.S.C. 3702) is delegated, with 
power of redelegation, to HCA's. HCA redelegation of this authority 
shall be in writing.
    (b) Policies and procedures regarding prior authorization required 
for media other than newspapers are contained in USDA Departmental 
Regulations 1400 series.



PART 406_COMPETITION REQUIREMENTS--Table of Contents




   Subpart 406.2_Full and Open Competition After Exclusion of Sources

Sec.
406.202 Establishing or maintaining alternative sources.

           Subpart 406.3_Other Than Full and Open Competition

406.302 Circumstances permitting other than full and open competition.
406.302-70 Otherwise authorized by law.

                   Subpart 406.5_Competition Advocates

406.501 Requirements.


[[Page 111]]


    Authority: 5 U.S.C. and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



   Subpart 406.2_Full and Open Competition After Exclusion of Sources



406.202  Establishing or maintaining alternative sources.

    The Senior Procurement Executive is authorized to make 
determinations pursuant to FAR 6.202(a) and sign the determination and 
findings required by FAR 6.202(b).



           Subpart 406.3_Other Than Full and Open Competition



406.302  Circumstances permitting other than full and open competition.



406.302-70  Otherwise authorized by law.

    (a) Authority. Section 1472 of the National Agricultural Research, 
Extension, and Teaching Policy Act of 1977 (7 U.S.C. 3318) (the Act) 
authorizes the Secretary of Agriculture to award contracts, without 
competition, to further research, extension, or teaching programs in the 
food and agricultural sciences.
    (b) Limitations. The use of this authority is limited to those 
instances where it can be determined that contracting without full and 
open competition is in the best interest of the Government and necessary 
to the accomplishment of the research, extension, or teaching program. 
Therefore:
    (1) Contracts under the authority of the Act shall be awarded on a 
competitive basis to the maximum practicable extent.
    (2) When full and open competition is not deemed appropriate, the 
contracting officer shall make a written justification on a case-by-case 
basis in accordance with procedures in FAR 6.303 and 6.304.



                   Subpart 406.5_Competition Advocates



406.501  Requirements.

    (a) The Chief, Procurement Policy Division, Office of Procurement 
and Property Management, has been designated as the Competition Advocate 
for USDA.
    (b) Each HCA shall designate a competition advocate for the 
contracting activity. The HCA shall forward a copy of the designation 
memorandum to the Competition Advocate for USDA.

[70 FR 45, Jan. 3, 2005]



PART 407_ACQUISITION PLANNING--Table of Contents




                     Subpart 407.1_Acquisition Plans

Sec.
407.103 Agency-head responsibilities.
407.170 Advance acquisition plans.

Subpart 407.3 [Reserved]

             Subpart 407.5_Inherently Governmental Functions

407.503 Policy.

    Authority: 5 U.S.C. 301 and 40 U.S.C.

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                     Subpart 407.1_Acquisition Plans



407.103  Agency-head responsibilities.

    Heads of Contracting Activities (HCA's) shall develop procedures to 
comply with FAR 7.103.



407.170  Advance acquisition plans.

    Each HCA shall maintain an advance acquisition planning system.

[70 FR 45, Jan. 3, 2005]

Subpart 407.3 [Reserved]



             Subpart 407.5_Inherently Governmental Functions



407.503  Policy.

    (a) HCA's shall establish procedures to ensure that requesting 
activities

[[Page 112]]

provide the written determination required by FAR 7.503(e), when 
submitting requests for procurement of services.
    (b) In the event of a disagreement as to whether the functions to be 
performed are inherently governmental, the HCA may refer the matter to 
the Senior Procurement Executive (SPE) for resolution. When submitting 
disagreements to the SPE for resolution the HCA shall provide a summary 
of the areas of disagreement, supported by the following:
    (1) The HCA's assessment of whether the services are ``inherently 
governmental'';
    (2) The basis for that assessment (include references to the 
definition and policy in FAR subpart 7.5 and/or Office of Federal 
Procurement Policy letter 92-1);
    (3) A copy of the statement of work; and,
    (4) The requesting activity's written determination in accordance 
with FAR 7.503(e).
    (c) Such disagreements shall be resolved prior to issuance of the 
solicitation.

[61 FR 53646, Oct. 15, 1996, as amended at 63 FR 26995, May 15, 1998]



PART 408_REQUIRED SOURCES OF SUPPLIES AND SERVICES--Table of Contents




                 Subpart 408.4_Federal Supply Schedules

Sec.
408.404 Using schedules.
408.404-3 Requests for waivers.

 Subpart 408.7_Acquisition From Nonprofit Agencies Employing People Who 
                     Are Blind or Severely Disabled

408.701 Definitions.
408.705 Procedures.
408.705-2 Direct order process.
408.705-3 Allocation process.
408.705-4 Compliance with orders.
408.706 Purchase exemptions.
408.707 Prices.
408.711 Quality complaints.
408.712 Specification changes.
408.714 Communications with the central nonprofit agencies and the 
          Committee.

       Subpart 408.8_Acquisition of Printing and Related Supplies

408.802 Policy.

                Subpart 408.11_Leasing of Motor Vehicles

408.1103 Contract requirements.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                 Subpart 408.4_Federal Supply Schedules



408.404  Using schedules.



408.404-3  Requests for waivers.

    A copy of the request for a waiver and the approval shall be placed 
in the contract file to support the acquisition of items off schedule.



 Subpart 408.7_Acquisition From Nonprofit Agencies Employing People Who 
                     Are Blind or Severely Disabled

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.

    Editorial Note: Nomenclature changes to subpart 408.7 appear at 70 
FR 45, Jan. 3, 2005.



408.701  Definitions.

    Committee Member is the Presidential appointee representing USDA as 
a member of the Committee for Purchase from People Who Are Blind or 
Severely Disabled.
    Organization head is the Under Secretary or Assistant Secretary of a 
mission area or the head of a USDA staff office.

[70 FR 45, Jan. 3, 2005]



408.705  Procedures.

    (a) The organization head shall appoint one person as Javits-Wagner-
O'Day Act (JWOD) Liaison to represent the organization and to coordinate 
the organization's actions with the Committee Member.
    (b) JWOD advocates may represent more than one organization. 
Liaisons need not be acquisition officials.
    (c) The organization head shall issue and maintain a performance 
plan to promote and enhance the organization's acquisitions from JWOD 
participating nonprofit agencies.
    (d) The performance plan shall:

[[Page 113]]

    (1) Announce the organization's support for the JWOD Act;
    (2) Establish a promotion program for the products and services 
provided by the JWOD participating nonprofit agencies;
    (3) Provide for the JWOD Liaison's role in acquisition planning;
    (4) Establish measurable program goals for growth or other 
accomplishment in the organization's JWOD program actions; and
    (5) Establish an awards program for successful participation in the 
JWOD program.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 45, Jan. 3, 2005]



408.705-2  Direct order process.

    (a) The chief of a contracting office may apply to a central 
nonprofit agency for authorization to order specific supplies or 
services directly from a JWOD participating nonprofit agency.
    (b) A copy of the application should be provided to the JWOD Liaison 
who will inform the USDA Committee Member.



408.705-3  Allocation process.

    (a) The chief of a contracting office may apply to a central 
nonprofit agency for a production allocation of specific supplies or 
services to a JWOD participating nonprofit agency.
    (b) A copy of the application should be provided to the JWOD Liaison 
who will inform the USDA Committee Member.



408.705-4  Compliance with orders.

    Prior to attempting to resolve a failure to perform by a 
participating nonprofit agency with the Committee, the chief of the 
contracting office should provide advance notice to the JWOD Liaison who 
will inform the USDA Committee Member.



408.706  Purchase exemptions.

    Prior to applying to the Committee for a purchase exemption, the 
chief of the contracting office should provide advance notice to the 
JWOD Liaison who will inform the USDA Committee Member.



408.707  Prices.

    Prior to applying for a price revision, the chief of the contracting 
office should provide advance notice to the JWOD Liaison who will inform 
the USDA Committee Member.



408.711  Quality complaints.

    Prior to attempting to resolve a complaint regarding the quality of 
goods or services provided by participating nonprofit agency with the 
Committee, the chief of the contracting office should provide advance 
notice to the JWOD Liaison who will inform the USDA Committee Member.



408.712  Specification changes.

    Prior to providing 90-days advance notification to the Committee on 
actions that affect supplies and services on the Procurement List, the 
chief of the contracting office should provide advance notice to the 
JWOD Liaison who will inform the USDA Committee Member.



408.714  Communications with the central nonprofit agencies and the Committee.

    Any matter requiring referral to the Committee shall be provided to 
the JWOD Liaison who will coordinate the matter with the Committee 
Member.



       Subpart 408.8_Acquisition of Printing and Related Supplies



408.802  Policy.

    (a) The Director, Office of Communications (OC) has been designated 
as the central printing authority in USDA, with the authority to 
represent the USDA before the Joint Committee on Printing (JCP), the 
Government Printing Office, and other Federal and State agencies on all 
matters related to printing.
    (b) Prior to contracting for any of the items defined in FAR 8.801, 
the contracting officer shall verify that the requisite approval has 
been received by the publication liaison officer or requisitioner.
    (c) The approval from OC or the approval authority designated by OC 
shall be maintained in the contract file.

[[Page 114]]



                Subpart 408.11_Leasing of Motor Vehicles



408.1103  Contract requirements.

    If the requirement includes the need for the vendor to provide 
operational maintenance such as fueling, lubrication, or other fluid 
changes or replenishment, the contracting officer shall include in the 
contract:
    (1) A requirement for the use of fluids and lubricants containing 
the maximum available amounts of recovered materials, and alternative 
fuels whenever available; and
    (2) A preference for retreaded tires meeting the Federal retread 
specifications, tires with the maximum recovered material content, or 
retreading services for the tires on the vehicle.

[70 FR 45, Jan. 3, 2005]



PART 409_CONTRACTOR QUALIFICATIONS--Table of Contents




          Subpart 409.4_Debarment, Suspension and Ineligibility

Sec.
409.403 Definitions.
409.404 List of parties excluded from Federal procurement and 
          nonprocurement programs.
409.405 Effect of listing.
409.405-1 Continuation of current contracts.
409.405-2 Restrictions on subcontracting.
409.406 Debarment.
409.406-3 Procedures.
409.407 Suspension.
409.407-3 Procedures.

    Subpart 409.5_Organizational and Consultant Conflicts of Interest

409.503 Waiver.

    Authority: 40 U.S.C. 121, 41 U.S.C. 421.

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



          Subpart 409.4_Debarment, Suspension and Ineligibility



409.403  Definitions.

    Debarring official. Pursuant to the Secretary's delegations of 
authority in 7 CFR 2.24, the Senior Procurement Executive (SPE) is 
designated as the debarring official (Department Debarring Officer) with 
the following exceptions:
    (a) For commodity contracts awarded on behalf of the Commodity 
Credit Corporation (CCC), the Executive Vice President, CCC, or his 
designee is designated as the debarring official pursuant to 7 CFR part 
1407.
    (b) For contracts awarded under the School Lunch and Surplus Removal 
Programs (42 U.S.C. 1755 and 7 U.S.C. 612c), the Department Debarring 
Officer has delegated debarring authority to the Agricultural Marketing 
Service (AMS).

[63 FR 26995, May 15, 1998]



409.404  List of parties excluded from Federal procurement and nonprocurement programs.

    The Department Debarring Officer is USDA's single point of contact 
with GSA for debarment and suspension actions taken under this subpart. 
The debarring official for AMS shall notify the Department Debarring 
Officer of each debarment and suspension action by promptly submitting a 
copy of the debarment or suspension notice and any later changes to the 
debarment or suspension status. The Department Debarring Officer will 
forward a copy of each notice to GSA for inclusion in the Government-
wide list.



409.405  Effect of listing.

    Compelling reasons are considered to be present where failure to 
contract with the debarred or suspended contractor would seriously harm 
the agency's programs and prevent accomplishment of mission 
requirements. The SPE is authorized to make the determinations under FAR 
9.405. Requests for such determinations shall be submitted through the 
head of the contracting activity (HCA) to the SPE.



409.405-1  Continuation of current contracts.

    The HCA is authorized to make the determinations under FAR 9.405-1.



409.405-2  Restrictions on subcontracting.

    The HCA is authorized to approve subcontracts with debarred or 
suspended subcontractors under FAR 9.405-2.

[[Page 115]]



409.406  Debarment.



409.406-3  Procedures.

    (a) Investigation and referral. When a contracting officer becomes 
aware of possible irregularities or any information which may be 
sufficient cause for debarment, the case shall be immediately referred 
through the HCA to the debarring official. The case must be accompanied 
by a complete statement of the facts (including a copy of any criminal 
indictments, if applicable) along with a recommendation for action. 
Where the statement of facts indicates the irregularities to be possible 
criminal offenses, or for any other reason further investigation is 
considered necessary, the matter shall be referred to the HCA who should 
consult with the Office of Inspector General to determine if further 
investigation is required prior to referring to the debarring official.
    (b) Decision-making process. If, after reviewing the recommendations 
and consulting with the Office of Inspector General and Office of the 
General Counsel, as appropriate, the debarring official determines 
debarment is justified, the debarring official shall initiate the 
proposed debarment in accordance with FAR 9.406-3(c) and notify the HCA 
of the action taken.
    (c) Fact-finding proceeding. For actions listed under FAR 9.406-
3(b)(2), the contractor shall be given the opportunity to appear at an 
informal hearing. The hearing should be held at a location and time that 
is convenient to the parties concerned, if at all possible. The 
contractor and any specifically named affiliates may be represented by 
counsel or any duly authorized representative. Witnesses may be called 
by either party. The proceedings shall be conducted expeditiously and in 
such a manner that each party will have an opportunity to present all 
information considered pertinent to the proposed debarment. The 
contractor shall be provided a copy of a transcript of the proceedings 
under the conditions established in FAR 9.406-3(b)(2)(ii).



409.407  Suspension.



409.407-3  Procedures.

    (a) Investigation and referral. When a contracting officer becomes 
aware of possible irregularities or any information which may be 
sufficient cause for suspension, the case shall be immediately referred 
through the HCA to the debarring official. The case must be accompanied 
by a complete statement of the facts along with a recommendation for 
action. Where the statement of facts indicates the irregularities to be 
possible criminal offenses, or for any other reason further 
investigation is considered necessary, the matter shall be referred to 
the HCA who should consult with the Office of Inspector General to 
determine if further investigation is required prior to referring it to 
the debarring official.
    (b) Decision-making process. If, after reviewing the recommendations 
and consulting with the Office of Inspector General and Office of the 
General Counsel, as appropriate, the debarring official determines 
suspension is justified, the debarring official shall initiate the 
proposed suspension in accordance with FAR 9.407-3(c) and notify the HCA 
of the action taken.
    (c) Fact-finding proceedings. For actions listed under FAR 9.407-
3(b)(2), the contractor shall be given the opportunity to appear at an 
informal hearing, similar in nature to the hearing for debarments as 
discussed in 409.406-3(c).



    Subpart 409.5_Organizational and Consultant Conflicts of Interest



409.503  Waiver.

    (a) The HCA, on a non-delegable basis, is authorized to waive any 
general rule or procedure in FAR 9.5 when in the Government's interest.
    (b) Each request for waiver shall include:
    (1) The general rule or procedure proposed to be waived;
    (2) An analysis of the potential conflict, including the benefits 
and detriments to the Government and prospective contractors;

[[Page 116]]

    (3) A discussion of why the conflict cannot be avoided, neutralized, 
or mitigated; and
    (4) Advice of counsel obtained under FAR 9.504(b).



PART 410_MARKET RESEARCH--Table of Contents




Sec.
410.001 Policy.
410.002 Procedures.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c)

    Source: 70 FR 45, Jan. 3, 2005, unless otherwise noted.



410.001  Policy.

    In addition to those uses listed in FAR 10.001, agencies must use 
the results of market research to--
    (a) Ensure the minimum use of hazardous or toxic materials;
    (b) Ensure the maximum use of biobased products and biofuels; and
    (c) Identify products and services on or eligible for addition to 
the Javits-Wagner-O'Day Act Procurement List in order to achieve USDA's 
goal to increase participation in this program.



410.002  Procedures.

    Market research must include obtaining information on the commercial 
quality assurance practices as an alternative for Government inspection 
and testing prior to tender for acceptance.



PART 411_DESCRIBING AGENCY NEEDS--Table of Contents




      Subpart 411.1_Selecting and Developing Requirements Documents

Sec.
411.101 Order of precedence for requirements documents.
411.103 Market acceptance.
411.106 Purchase descriptions for service contracts.
411.170 Brand name or equal.
411.171 Solicitation provisions and contract clauses.

       Subpart 411.2_Using and Maintaining Requirements Documents

411.202 Maintenance of standardization documents.

             Subpart 411.4_Delivery or Performance Schedules

411.404 Contract clauses.

                Subpart 411.6_Priorities and Allocations

411.600 Scope of subpart.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



      Subpart 411.1_Selecting and Developing Requirements Documents



411.101  Order of precedence for requirements documents.

    (a) Office of Management and Budget (OMB) Circular A-119 establishes 
a Federal policy requiring the use of voluntary consensus standards in 
lieu of government-unique standards except where inconsistent with law 
or otherwise impractical.
    (b) The HCA is authorized to submit the determination required by 
OMB Circular A-119 that a voluntary standard is inconsistent with law or 
otherwise impracticable. The HCA must submit the determination to OMB 
through the National Institute of Standards and Technology in accordance 
with the Circular with a copy provided to the SPE.

[70 FR 45, Jan. 3, 2005]



411.103  Market acceptance.

    (a) The head of the contracting activity (HCA) may determine that 
offerors must demonstrate, in accordance with FAR 11.103(a), the market 
acceptability of their items to be offered.
    (b) The contracting officer shall place a copy of this 
determination, signed by the HCA, in the solicitation file.



411.106  Purchase descriptions for service contracts.

    When contract personnel are to be used, the requiring official shall 
record on the requisition his or her determination whether harm to the 
Government might occur should contractor

[[Page 117]]

personnel fail to identify themselves as non-Government officials.

[61 FR 53646, Oct. 15, 1996. Redesignated at 70 FR 45, Jan. 3, 2005]



411.170  Brand name or equal.

    (a) A ``brand name or equal'' purchase description shall include the 
following type of information:
    (1) Identification of the item by generic description.
    (2) Make, model number, catalog designation, or other description, 
and identification of a commercial catalog where it is listed.
    (3) Name of manufacturer, producer, or distributor of the item and 
complete address.
    (4) All salient characteristics of the ``brand name or equal'' 
product or products which have been determined by the requisitioner to 
be essential to the Government's minimum requirements.
    (b) [Reserved]



411.171  Solicitation provisions and contract clauses.

    (a) Contracting officers shall insert the provision at 452.211-70, 
Brand Name or Equal, in solicitations, other than those for 
construction, where ``brand name or equal'' purchase descriptions are 
used.
    (b) Contracting officers shall insert the clause at 452.211-71, 
Equal Products Offered, in solicitations, other than those for 
construction, where the provision at 452.211-70 is included.
    (c) Contracting officers shall insert the clause at 452.211-72, 
Statement of Work/Specifications, when the description (statement of 
work) or specification(s) is included in Section J of the solicitation.
    (d) Contracting officers shall insert the clause at 452.211-73, 
Attachment to Statement of Work/Specifications, when there are 
attachments to the description (statement of work) or specifications.

[63 FR 26995, May 15, 1998]



       Subpart 411.2_Using and Maintaining Requirements Documents



411.202  Maintenance of standardization documents.

    Recommendations for changes to standardization documents are to be 
submitted through the Senior Procurement Executive, who will coordinate 
the submission of these recommendations to the cognizant preparing 
activity.



             Subpart 411.4_Delivery or Performance Schedules



411.404  Contract clauses.

    (a) The contracting officer shall insert the clause at 452.211-74, 
Period of Performance, when it is necessary to specify a period of 
performance, beginning on the date of award, date of receipt of notice 
of award, or a specified date.
    (b) The contracting officer shall insert the clause at 452.211-75, 
Effective Period of the Contract, when it is necessary to specify the 
effective period of the contract.

[63 FR 26995, May 15, 1998]



                Subpart 411.6_Priorities and Allocations



411.600  Scope of subpart.

    The Defense Priorities and Allocation System (DPAS) excludes USDA 
activities (see 15 CFR 700.18(b)). USDA Contracting Officers are not 
authorized to place rated orders under DPAS.



PART 412_ACQUISITION OF COMMERCIAL ITEMS--Table of Contents




    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

[[Page 118]]



   Subpart 412.3_Solicitation Provisions and Contract Clauses for the 
                     Acquisition of Commercial Items



412.302  Tailoring of provisions and clauses for the acquisition of commercial items.

    The head of the contracting activity is authorized to approve 
waivers in accordance with FAR 12.302(c). The approved waiver may be 
either for an individual contract or for a class of contracts for the 
specific item. The approved waiver and supporting documentation shall be 
incorporated into the contract file.

[61 FR 53646, Oct. 15, 1996]

[[Page 119]]



           SUBCHAPTER C_CONTRACTING METHODS AND CONTRACT TYPES





PART 413_SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




              Subpart 413.3_Simplified Acquisition Methods

Sec.
413.301 Governmentwide commercial purchase card.
413.306 SF 44, Purchase Order-Invoice-Voucher.
413.307 Forms.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 64 FR 45895, Aug. 23, 1999, unless otherwise noted.



              Subpart 413.3_Simplified Acquisition Methods



413.301  Governmentwide commercial purchase card.

    USDA policy and procedures on use of the Governmentwide commercial 
purchase card are established in Departmental Regulation Series 5000.



413.306  SF 44, Purchase Order-Invoice-Voucher.

    The Standard Form 44 (and the previously prescribed USDA Form AD-
744) is not authorized for use within USDA.



413.307  Forms.

    Form AD-838, Purchase Order, is prescribed for use by USDA in lieu 
of Optional Forms (OFs) 347 and 348 except that use of the OF 347 and OF 
348 is authorized when utilizing the USDA Integrated Acquisition System.

[70 FR 45, Jan. 3, 2005]



PART 414_SEALED BIDDING--Table of Contents




                   Subpart 414.2_Solicitation of Bids

Sec.
414.201 Preparation of invitations for bids.
414.201-6 Solicitation provision.

           Subpart 414.4_Opening of Bids and Award of Contract

414.404 Rejection of bids.
414.404-1 Cancellation of invitations after opening.
414.407 Mistakes in bids.
414.407-3 Other mistakes disclosed before award.
414.407-4 Mistakes after award.
414.409 Information to bidders.
414.409-2 Award of classified contracts.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                   Subpart 414.2_Solicitation of Bids



414.201  Preparation of invitations for bids.



414.201-6  Solicitation provision.

    The contracting officer shall insert the provision 452.214-70, Award 
by Lot, when multiple items are segregated into clearly identifiable 
lots and the contracting officer wants to reserve the right to award by 
item within a lot, if award in that manner would be advantageous to the 
Government.



           Subpart 414.4_Opening of Bids and Award of Contract



414.404  Rejection of bids.



414.404-1  Cancellation of invitations after opening.

    An acquisition official at a level above the contracting officer is 
authorized to make the determinations under FAR 14.404-1(c) and (e)(1).



414.407  Mistakes in bids.



414.407-3  Other mistakes disclosed before award.

    The authority to make the determinations under FAR 14.407-3(a), (b), 
and (d) is delegated, without power of redelegation, to the head of the 
contracting activity. The authority to make the determination under FAR 
14.407-3(c) is delegated to the contracting officer. Each determination 
pursuant to FAR 14.407-3 shall have the concurrence of the Office of the 
General Counsel (OGC).

[[Page 120]]



414.407-4  Mistakes after award.

    If a mistake in bid is disclosed after award, the contracting 
officer shall make a final determination in accordance with the 
provisions of FAR 14.407-4 (b) and (c) and shall coordinate each 
proposed determination with OGC. Such coordination shall, at a minimum, 
consist of the contracting officer providing the proposed determination 
and the case file to OGC for comment.



414.409  Information to bidders.



414.409-2  Award of classified contracts.

    Disposition of classified information shall be in accordance with 
Departmental Regulation and Manual (3400 Series) and in accordance with 
direction issued by the Information Security Staff, Personnel and 
Document Security Division, Office of Procurement and Property 
Management.

[70 FR 45, Jan. 3, 2005]



PART 415_CONTRACTING BY NEGOTIATION--Table of Contents




   Subpart 415.2_Solicitation and Receipt of Proposals and Information

Sec.
415.204 Contract format.
415.207 Handling proposals and information.
415.209 Solicitation provisions and contract clauses.

                     Subpart 415.3_Source Selection

415.303 Responsibilities.
415.305 Proposal evaluation.

                     Subpart 415.4_Contract Pricing

415.404-4 Profit.

Subpart 415.5_Preaward, Award, and Postaward Notifications, Protests and 
                                Mistakes

415.570 Post-award conference.

                   Subpart 415.6_Unsolicited Proposals

415.604 Agency points of contact.
415.606 Agency procedures.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 64 FR 52674, Sept. 30, 1999, unless otherwise noted.



   Subpart 415.2_Solicitation and Receipt of Proposals and Information



415.204  Contract format.

    The Senior Procurement Executive is authorized to exempt contracts 
from the uniform contract format.



415.207  Handling proposals and information.

    (a) Throughout the source selection process, agency personnel and 
non-Government evaluators with access to proposal information shall 
disclose neither the number of offerors nor their identity except as 
authorized by FAR subpart 15.5. (See also FAR 5.403.)
    (b) The contracting officer shall obtain the following written 
agreement from the non-Government evaluator prior to the release of any 
proposal to that evaluator.

         Agreement Governing the Use and Disclosure of Proposals

RFP_____________________________________________________________________
Offeror_________________________________________________________________
    1. To the best of my knowledge and belief, no conflict of interest 
exists that may diminish my capacity to perform an impartial and 
objective review of the offeror's proposal, or may otherwise result in a 
biased opinion or an unfair advantage. If a potential conflict of 
interest arises or if I identify such a conflict, I agree to notify the 
Government promptly concerning the potential conflict. In determining 
whether any potential conflict of interest exists, I agree to review 
whether my or my employer's relationships with other persons or 
entities, including, but not limited to, ownership of stocks, bonds, 
other outstanding financial interests or commitments, employment 
arrangements (past, present, or under consideration), and, to the extent 
known by me, all financial interests and employment arrangements of my 
spouse, minor children, and other members of my immediate household, may 
place me in a position of conflict, real or apparent, with the 
evaluation proceedings.
    2. I agree to use proposal information only for evaluation purposes. 
I understand that any authorized restriction on disclosure placed upon 
the proposal by the prospective contractor or subcontractor or by the 
Government shall be applied to any reproduction or abstracted 
information of the proposal. I agree to use my best effort to safeguard 
such information physically, and not to disclose the contents of, or 
release any information relating to, the proposal(s) to anyone outside 
of the Source Evaluation Board or other

[[Page 121]]

panel assembled for this acquisition, the Contracting Officer, or other 
individuals designated by the Contracting Officer.
    3. I agree to return to the Government all copies of proposals, as 
well as any abstracts, upon completion of the evaluation.
________________________________________________________________________
(Name and Organization)
________________________________________________________________________
(Date)

                           (End of provision)

    (c) The release of a proposal to a non-Government evaluator for 
evaluation does not constitute the release of information for purposes 
of the Freedom of Information Act (5 U.S.C. 552).
    (d) The contracting officer shall attach a cover page bearing the 
following notice: GOVERNMENT NOTICE FOR HANDLING PROPOSALS--This 
proposal shall be used and disclosed for evaluation purposes only. 
Attach a copy of this Government notice to every reproduction or 
abstract of the proposal. Any authorized restrictive notices which the 
submitter places on this proposal shall be strictly complied with. 
Disclosure of this proposal outside the Government for evaluation 
purposes shall be made only to the extent authorized by, and in 
accordance with, FAR 3.104-4, FAR 15.207, and AGAR 415.207.

[64 FR 52674, Sept. 30, 1999; 64 FR 54963, Oct. 8, 1999, as amended at 
70 FR 46, Jan. 3, 2005]



415.209  Solicitation provisions and contract clauses.

    (a) The provision at 452.215-71, Instructions for the Preparation of 
Technical and Business Proposals, may be used when offerors will be 
required to submit technical and business proposals. Contracting 
officers should tailor the clause to reflect the degree of information 
required for the specific acquisition.
    (b) The contracting officer shall insert the provision at 452.215-
72, Amendments to Proposals, in solicitations which require the 
submittal of lengthy, complex technical proposals.



                     Subpart 415.3_Source Selection



415.303  Responsibilities.

    The head of the contracting activity (HCA) is authorized to appoint 
an individual other than the contracting officer as the source selection 
authority.



415.305  Proposal evaluation.

    HCAs are responsible for establishing procedures regarding the 
release of cost information to the members of the technical evaluation 
team.



                     Subpart 415.4_Contract Pricing



415.404-4  Profit.

    (a)(1) USDA will use a structured approach to determine the profit 
or fee prenegotiation objective in acquisition actions when price 
negotiation is based on cost analysis.
    (2) The following types of acquisitions are exempt from the 
requirements of the structured approach, but the contracting officer 
shall comply with FAR 15.404-4(d) when analyzing profit for these 
contracts or actions:
    (i) Architect-engineer contracts;
    (ii) Construction contracts;
    (iii) Contracts primarily requiring delivery of material supplied by 
subcontractors;
    (iv) Termination settlements; and
    (v) Cost-plus-award-fee contracts;
    (b) Unless otherwise restricted by contracting activity procedures, 
the Contracting Officer may use another Federal agency's structured 
approach if that approach has been formalized and is maintained as part 
of that Agency's acquisition regulations (i.e., included in that 
Agency's assigned chapter of Title 48 of the Code of Federal 
Regulations).
    (c) The HCA is responsible for establishing procedures to ensure 
compliance with this subpart.



Subpart 415.5_Preaward, Award, and Postaward Notifications, Protests and 
                                Mistakes



415.570  Post-award conference.

    If a postaward conference is necessary, the contracting officer 
shall insert clause 452.215-73, Post-Award Conference.

[[Page 122]]



                   Subpart 415.6_Unsolicited Proposals



415.604  Agency points of contact.

    HCAs are responsible for establishing procedures to ensure 
compliance with the requirements of FAR 15.604.



415.606  Agency procedures.

    HCAs are responsible for establishing the procedures for control of 
unsolicited proposals required by FAR 15.606(a) and for identifying the 
contact points as required by FAR 15.606(b).



PART 416_TYPES OF CONTRACTS--Table of Contents




Sec.
416.000 Scope of part.

                   Subpart 416.2_Fixed-Price Contracts

416.203 Fixed-price contracts with economic price adjustment.
416.203-4 Contract clauses.

                    Subpart 416.4_Incentive Contracts

416.405 Cost-reimbursement incentive contracts.
416.405-2 Cost-plus-award-fee contracts.
416.406 Contract clauses.
416.470 Solicitation provision.

               Subpart 416.5_Indefinite-Delivery Contracts

416.505 Ordering.
416.506 Solicitation provision and contract clauses.

   Subpart 416.6_Time-and-Materials, Labor-Hour, and Letter Contracts

416.603 Letter contracts.
416.603-2 Application.
416.603-4 Contract clauses.
416.670 Contract clauses.

                        Subpart 416.7_Agreements

416.702 Basic agreements.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



416.000  Scope of part.

    Heads of contracting activities (HCA's) are authorized to establish 
written procedures allowing the use of any contract type described in 
FAR part 16 for acquisitions made under simplified acquisition 
procedures in FAR part 13.



                   Subpart 416.2_Fixed-Price Contracts



416.203  Fixed-price contracts with economic price adjustment.



416.203-4  Contract clauses.

    An economic price adjustment clause based on cost indexes of labor 
or material may be used under the conditions listed in FAR 16.203-4(d) 
after approval by the HCA and consultation with the Office of the 
General Counsel.



                    Subpart 416.4_Incentive Contracts



416.405  Cost-reimbursement incentive contracts.



416.405-2  Cost-plus-award-fee contracts.

    The HCA may designate an acquisition official other than the 
contracting officer as the fee determination official (FDO) to make the 
final determination of the award fee. The designated official must have 
warranted contracting authority at the same level as the contracting 
officer or higher, and shall not have participated in preparing the 
contractor performance evaluation. If the HCA does not designate an FDO, 
the chief of the contracting office shall act as the FDO.

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26995, May 15, 1998.]



416.406  Contract clauses.

    The contracting officer shall insert a clause substantially the same 
as the clause at 452.216-70, Award Fee, in solicitations and contracts 
which contemplate the award of cost-plus-award-fee contracts.

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26995, May 15, 1998.]



416.470  Solicitation provision.

    The contracting officer shall insert the provision at 452.216-71, 
Base Fee and Award Fee Proposal, in solicitations which contemplate the 
award of a cost-plus-award-fee contract.

[[Page 123]]



               Subpart 416.5_Indefinite-Delivery Contracts



416.505  Ordering.

    (a) The Chief, Procurement Policy Division, Office of Procurement 
and Property Management, has been designated as the Departmental Task 
Order Ombudsman.
    (b) Each HCA shall designate a task order ombudsman for the 
contracting activity. The HCA shall forward a copy of the designation 
memorandum to the Departmental Task Order Ombudsman. Contracting 
activity ombudsmen shall review and resolve complaints from contractors 
concerning task or delivery orders placed by the contracting activity.
    (c) Any contractor who is not satisfied with the resolution of a 
complaint by a contracting activity ombudsman may request the 
Departmental Task Order Ombudsman to review the complaint.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 46, Jan. 3, 2005]



416.506  Solicitation provision and contract clauses.

    (a) The contracting officer shall insert a provision substantially 
the same as the provision at 452.216-72, Evaluation Quantities-
Indefinite-Delivery Contract, in solicitations which contemplate the 
award of indefinite-quantity or requirements contracts to establish the 
basis on which offers will be evaluated.
    (b) The contracting officer shall insert the clause at 452.216-73, 
Minimum and Maximum Contract Amounts, in indefinite-delivery, 
indefinite-quantity contracts when the clause at FAR 52.216-18 is used.



   Subpart 416.6_Time-and-Materials, Labor-Hour, and Letter Contracts



416.603  Letter contracts.



416.603-2  Application.

    The HCA is authorized to extend the period for defining a letter 
contract required by FAR 16.603-2(c) in extreme cases where it is 
determined in writing that such action is in the best interest of the 
Government.



416.603-4  Contract clauses.

    The contracting officer shall insert the clause at 452.216-75, 
Letter Contract, in a definitive contract superseding a letter contract.



416.670  Contract clauses.

    The contracting officer shall limit the Government's obligation 
under a time-and-materials or labor-hour contract by inserting the 
clause at 452.216-74, Ceiling Price.



                        Subpart 416.7_Agreements



416.702  Basic agreements.

    Promptly after execution by the Government, the HCA shall furnish to 
the Senior Procurement Executive a copy of each basic agreement 
negotiated with contractors in accordance with FAR 16.702.



PART 417_SPECIAL CONTRACTING METHODS--Table of Contents




    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).



                          Subpart 417.2_Options



417.204  Contracts.

    The head of the contracting activity is authorized to approve 
contracts which exceed the 5 year limitation in FAR 17.204(e).

[61 FR 53646, Oct. 15, 1996]

                           PART 418 [RESERVED]

[[Page 124]]



                   SUBCHAPTER D_SOCIOECONOMIC PROGRAMS





PART 419_SMALL BUSINESS PROGRAMS--Table of Contents




                         Subpart 419.2_Policies

Sec.
419.201 General policy.
419.201-70 Office of Small and Disadvantaged Business Utilization 
          (OSDBU).
419.201-71 Small business coordinators.
419.201-73 Reports.

               Subpart 419.5_Set-Asides for Small Business

419.508 Solicitation provisions and contract clauses.

     Subpart 419.6_Certificates of Competency and Determinations of 
                             Responsibility

419.602 Procedures.
419.602-1 Referral.
419.602-3 Resolving differences between the agency and the Small 
          Business Administration.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                         Subpart 419.2_Policies

    Source: 70 FR 46, Jan. 3, 2005, unless otherwise noted.



419.201  General policy.

    It is the policy of USDA to provide maximum practicable contracting 
and subcontracting opportunities to small business (SB), small 
disadvantaged business (SDB), HUBZone small business, women-owned 
business (WOB), veteran-owned small business (VOSB), and service-
disabled veteran-owned small business (SDVOSB) concerns.



419.201-70  Office of Small and Disadvantaged Business Utilization (OSDBU).

    The Office of Small and Disadvantaged Business Utilization (OSDBU) 
develops rules, policy, procedures and guidelines for the effective 
administration of USDA's small business program that includes all 
categories named under 419.201.



419.201-71  Small business coordinators.

    The head of the contracting activity (HCA) or a representative of 
the HCA shall designate in writing a small business coordinator in each 
contracting office. Supervisors of small business coordinators are 
encouraged to provide sufficient time for the coordinators to carry out 
their small business program duties. Coordinators' duties shall include, 
but not be limited to, the following:
    (a) Reviewing each proposed acquisition expected to exceed the 
simplified acquisition threshold prior to its solicitation. The 
coordinator shall:
    (1) Recommend section 8(a), HUBZone, or SDVOSB action and identify 
potential contractors, or
    (2) Identify available SDB, WOB, and VOSB to be solicited by 
competitive procedures. Coordinators shall document the contract file 
with recommendations made and actions taken.
    (b) Participating in goal-setting procedures and planning activities 
and establishing aggressive SDB, WOB, and SDVOSB goals based on the 
annual review of advance acquisition plans.
    (c) Participating in the review of those contracts which require the 
successful offeror to submit written plans for the utilization of small 
businesses as subcontractors to include all preference program areas in 
419.201.
    (d) Ensuring that purchases exceeding $2,500 and not exceeding the 
simplified acquisition threshold are reserved exclusively for small 
businesses, including all preference program areas named in 419.201. 
This policy shall be implemented unless the contracting officer is 
unable to obtain offers from two or more small business concerns that 
are competitive with market prices and in terms of quality and delivery 
of the goods or services being purchased.
    (e) Maintaining comprehensive source listings of small businesses.

[[Page 125]]

    (f) Upon written request, providing small businesses (in the 
preference program areas named in 419.201) the bidders' mailing lists of 
individuals receiving solicitations which will contain the 
subcontracting clause entitled ``Utilization of Small Business 
Concerns'' (FAR 52.219-8). These lists may be limited to those supplies 
or services of major interest to the requesting firms.
    (g) Developing a program of contacts with local and small (to 
include all preference program areas named in 419.201) trade, business, 
and professional associations and organizations and Indian tribal 
councils to apprise them of USDA's program needs and recurring contract 
requirements.
    (h) Periodically meeting with program managers to discuss 
requirements of the small business preference program, to explore the 
feasibility of breaking large complex requirements into smaller lots 
suitable for participation by small firms, and to encourage program 
managers to meet with these firms so that their capabilities can be 
demonstrated.
    (i) Establishing internal operating procedures which implement the 
requirements of the regulations as set forth in this part 419.
    (j) Compiling data and preparing all reports pertaining to the small 
business program activities, and ensuring that these reports are 
accurate, complete and up-to-date.
    (k) Assisting and counseling small business firms.
    (l) Reviewing proposed large contract requirements that may be 
bundled to determine the potential for breaking out components suitable 
for purchase from small business firms.
    (m) Ensuring that the SBA Resident Procurement Center Representative 
(PCR) is provided an opportunity and reasonable time to review any 
solicitation that meets the dollar threshold for small business 
(including all preference program areas named in 419.201) subcontracting 
plans.



419.201-73  Reports.

    The Director, OSDBU, shall be responsible for submitting reports 
concerning USDA's progress and achievements in the procurement 
preference program.



               Subpart 419.5_Set-Asides for Small Business



419.508  Solicitation provisions and contract clauses.

    The contracting officer shall insert the provision at 452.219-70, 
Size Standard and NAICS Code Information, in solicitations that are set 
aside for small businesses.

[61 FR 53646, Oct. 15, 1996, as amended at 66 FR 49317, Sept. 27, 2001]



     Subpart 419.6_Certificates of Competency and Determinations of 
                             Responsibility



419.602  Procedures.



419.602-1  Referral.

    Contracting officers shall refer determinations of non-
responsibility regarding small businesses directly to the SBA Regional 
Office servicing the location where the contractor's office (home) is 
located.



419.602-3  Resolving differences between the agency and the Small Business Administration.

    The HCA is authorized to appeal the issuance of a COC to SBA 
Headquarters as provided by FAR 19.602-3(a).

[63 FR 26995, May 15, 1998]

                        PARTS 420	421 [RESERVED]



PART 422_APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS--Table of Contents




                   Subpart 422.1_Basic Labor Policies

Sec.
422.103 Overtime.
422.103-4 Approvals.

       Subpart 422.3_Contract Work Hours and Safety Standards Act

422.302 Liquidated damages and overtime pay.

[[Page 126]]

   Subpart 422.4_Labor Standards for Contracts Involving Construction

422.404 Davis-Bacon Act wage determinations.
422.404-6 Modifications of wage determinations.
422.406 Administration and enforcement.
422.406-8 Investigations.

             Subpart 422.6_Walsh-Healey Public Contracts Act

422.604 Exemptions.
422.604-2 Regulatory exemptions.
422.608 [Reserved]

               Subpart 422.8_Equal Employment Opportunity

422.803 Responsibilities.
422.804 Affirmative action programs.
422.804-2 Construction.
422.807 Exemptions.

 Subpart 422.13_Special Disabled Veterans, Veterans of the Vietnam Era, 
                       and Other Eligible Veterans

422.1305 Waivers.
422.1308 Complaint procedures.

         Subpart 422.14_Employment of Workers With Disabilities

422.1403 Waivers.
422.1406 Complaint procedures.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                   Subpart 422.1_Basic Labor Policies



422.103  Overtime.



422.103-4  Approvals.

    Requests for the use of overtime shall be approved by an acquisition 
official at a level above the contracting officer in accordance with the 
procedures in FAR 22.103-4 (a) and (b).



       Subpart 422.3_Contract Work Hours and Safety Standards Act



422.302  Liquidated damages and overtime pay.

    Heads of contracting activities (HCA's) are authorized to review 
determinations of liquidated damages due under section 104(c) of the 
Contract Work Hours and Safety Standards Act, and to take remedial 
action, if appropriate, in accordance with FAR 22.302(c). Contractors or 
subcontractors may request review of administrative determinations of 
liquidated damages by written notice to the contracting officer. The 
contracting officer shall promptly forward appeals of liquidated damages 
determinations to the HCA.



   Subpart 422.4_Labor Standards for Contracts Involving Construction



422.404  Davis-Bacon Act wage determinations.



422.404-6  Modifications of wage determinations.

    HCA's are authorized to request extension of the 90 day period for 
award after bid opening as provided in FAR 22.404-6(b)(6).



422.406  Administration and enforcement.



422.406.8  Investigations.

    Reports of violations shall be forwarded to the HCA, who shall 
process such reports in accordance with FAR 22.406-8(d).



             Subpart 422.6_Walsh-Healey Public Contracts Act



422.604  Exemptions.



422.604-2  Regulatory exemptions.

    The Assistant Secretary for Administration can request the Secretary 
of Labor to exempt contracts from the Walsh-Healey Public Contracts Act 
pursuant to FAR 22.604-2(b). A written finding justifying the request 
for exemption shall be prepared for the Assistant Secretary's signature 
and submitted by the HCA to the Senior Procurement Executive (SPE) for 
referral to the Assistant Secretary.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 46, Jan. 3, 2005]

[[Page 127]]



422.608  [Reserved]



               Subpart 422.8_Equal Employment Opportunity



422.803  Responsibilities.

    The contracting office shall submit questions involving the 
applicability of Executive Order 11246 and FAR subpart 22.8 through the 
HCA to the SPE for resolution.



422.804  Affirmative action programs.



422.804-2  Construction.

    The HCA shall ensure that each contracting office, awarding 
nonexempt construction contracts, maintains a current listing of covered 
geographical areas subject to affirmative action requirements specifying 
goals for minorities and women in covered construction trades.



422.807  Exemptions.

    (a) The Assistant Secretary for Administration is authorized to make 
the determination in FAR 22.807(a)(1) that a contract is essential to 
the national security.
    (b) The contracting officer shall submit requests for exemptions 
under FAR 22.807(a)(1), (a)(2), and (b)(5) through the HCA to the SPE 
for determination by the Assistant Secretary of Administration or 
referral to the Deputy Assistant Secretary for Federal Contract 
Compliance Programs, Department of Labor, as appropriate.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 46, Jan. 3, 2005]



 Subpart 422.13_Special Disabled Veterans, Veterans of the Vietnam Era, 
                       and Other Eligible Veterans

    Source: 70 FR 46, Jan. 3, 2005, unless otherwise noted.



422.1305  Waivers.

    (a) The Assistant Secretary for Administration is authorized to make 
the waiver determination in FAR 22.1305(b) that a contract is essential 
to the national security.
    (b) The contracting officer shall submit requests for exemptions 
under FAR 22.1305(a) and (b) through the HCA to the SPE for 
determination by the Assistant Secretary for Administration or referral 
to the Deputy Assistant Secretary for Federal Contract Compliance 
Programs, Department of Labor as appropriate.



422.1308  Complaint procedures.

    The contracting officer shall forward complaints received about the 
administration of the Vietnam Era Veterans Readjustment Assistance Act 
directly to the Department of Labor as prescribed in FAR 22.1308.



         Subpart 422.14_Employment of Workers With Disabilities



422.1403  Waivers.

    (a) The Assistant Secretary for Administration is authorized to make 
the waiver determinations under FAR 22.1403(a) and (b) with the 
concurrence of the Deputy Assistant Secretary for Federal Contract 
Compliance Programs, Department of Labor.
    (b) The contracting officer shall submit requests for waivers 
through the HCA to the SPE for determination by the Assistant Secretary 
for Administration.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 46, Jan. 3, 2005]



422.1406  Complaint procedures.

    The contracting officer shall forward complaints received about the 
administration of Section 503 of the Rehabilitation Act of 1973, as 
amended, directly to the OFCCP as prescribed in FAR 22.1406.



PART 423_ENVIRONMENT, ENERGY AND WATER EFFICIENCY, RENEWABLE ENERGY TECHNOLOGIES, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE--Table of Contents




Subpart 423.1 [Reserved]

     Subpart 423.2_Energy and Water Efficiency and Renewable Energy

Sec.
423.202 Policy.

[[Page 128]]

                Subpart 423.4_Use of Recovered Materials

423.400 Scope of subpart.
423.402 [Reserved]
423.403 Policy.
423.404 Agency affirmative procurement programs.
423.405 Procedures.

                    Subpart 423.5_Drug-Free Workplace

423.506 Suspension of payments, termination of contract, and debarment 
          and suspension actions.

              Subpart 423.6_Notice of Radioactive Material

423.601 Requirements.

 Subpart 423.7_Contracting for Environmentally Preferable Products and 
                                Services

423.703 Policy.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 70 FR 47, Jan. 3, 2005, unless otherwise noted.

Subpart 423.1 [Reserved]



     Subpart 423.2_Energy and Water Efficiency and Renewable Energy



423.202  Policy.

    Information on Energy Star, energy efficient, water efficient, and 
low standby products covered by this policy is available via the 
Internet at http://www.eere.energy.gov/femp/technologies/eeproducts.cfm.



                Subpart 423.4_Use of Recovered Materials



423.400  Scope of subpart.

    This subpart implements and supplements FAR policies and procedures 
for acquiring products and services when preference is given to offers 
of products containing recovered materials. This subpart further 
supplements FAR subpart 23.4 by providing guidance for affirmative 
procurement programs in accordance with Executive Order 13101 and 42 
U.S.C. 6962.



423.402  [Reserved]



423.403  Policy.

    It is the policy of USDA to acquire and use Environmental Protection 
Agency (EPA) designated recycled content products.



423.404  Agency affirmative procurement programs.

    The USDA affirmative procurement program (APP) policy applicable to 
all USDA agencies and staff offices is hereby established. The 
components of this APP include:
    (a) Recovered Materials Preference Program. In accord with the 
requirements of Section 402(c) of Executive Order 13101, Greening the 
Government Through Recycling, Waste Prevention, and Federal Acquisition, 
USDA agencies will include, in all applicable solicitations and 
contracts, a preference for products and services which meet or exceed 
the EPA purchasing guidelines as contained in the EPA product Recovered 
Materials Advisory Notices (RMANs). Agencies may choose an evaluation 
factor preference, or other method of indicating preference in accord 
with their agency needs. Agencies will, as appropriate, eliminate virgin 
material requirements in contract specifications and replace them with a 
statement of preference for recycled materials.
    (b) Promotion program. USDA agencies will actively promote a 
preference for recovered materials, environmentally preferable products, 
and biobased products in contacts with vendors, in written materials, 
and other appropriate opportunities.
    (c) Reasonable estimation of recovered materials used in the 
performance of contracts. USDA agencies annually will provide in writing 
to the USDA Senior Procurement Executive, in response to a call for data 
for the Resource Conservation and Recovery report, reasonable estimates, 
certification, and verification of recovered material used in the 
performance of contracts.
    (d) Annual review and monitoring of effectiveness of the program. 
USDA agencies will provide an annual assessment of the effectiveness of 
their affirmative

[[Page 129]]

procurement program actions in increasing the purchase and use of EPA 
designated products.
    (e) Purchase of EPA designated products. USDA agencies will require 
that 100% of purchases of EPA-designated products contain recovered 
material, unless the item cannot be acquired--
    (1) Competitively within a reasonable time frame;
    (2) Meeting appropriate performance standards; or
    (3) At a reasonable price.
    (f) The 100% purchase requirement of paragraph (e) of this section 
applies to all USDA agency purchases, including those at or below the 
micro-purchase threshold.



423.405  Procedures.

    (a) The threshold of purchase for EPA designated items is $10,000 
per year at the USDA departmental, not individual agency, level. 
Therefore, the APP requirements above, including the 100% purchase 
requirement, apply at the individual agency and staff office level.
    (b) Contracting officers should refer to EPA's list of designated 
products and products identified as recycled content when purchasing 
supplies or services. Information on EPA designated products is 
available at: www.epa.gov/cpg/products.htm.
    (c) All agencies and USDA Contracting Officers must take necessary 
actions to carry out the provisions of the USDA APP policy described in 
this subpart.



                    Subpart 423.5_Drug-Free Workplace



423.506  Suspension of payments, termination of contract, and debarment and suspension actions.

    (a) The contracting officer may recommend waiver of the 
determination to suspend payments, to terminate a contract, or to debar 
or to suspend a contractor.
    (b) The recommendation shall be submitted through the HCA to the SPE 
and shall include a full description of the disruption of USDA 
operations should the determination not be waived.
    (c) The SPE will submit the request for a waiver to the Secretary 
with a recommendation for action.



              Subpart 423.6_Notice of Radioactive Material



423.601  Requirements.

    The HCA shall establish a system of instructions to identify the 
installation/facility radiation protection officer.



 Subpart 423.7_Contracting for Environmentally Preferable Products and 
                                Services



423.703  Policy.

    (a) USDA's Affirmative Procurement Program promotes energy-
efficiency, water conservation, and the acquisition of environmentally 
preferable products and services. In its acquisitions, USDA will support 
federal ``green purchasing'' principles in the acquisition of products 
and services that are environmentally preferable or that are biobased 
content products and services.
    (b) USDA agencies will actively promote this preference for 
environmentally preferable products and biobased products in contacts 
with vendors, in written materials, and other appropriate opportunities.



PART 424_PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION--Table of Contents




             Subpart 424.1_Protection of Individual Privacy

Sec.
424.103 Procedures.
424.104 Contract clauses.

                Subpart 424.2_Freedom of Information Act

424.203 Policy.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.

[[Page 130]]



             Subpart 424.1_Protection of Individual Privacy



424.103  Procedures.

    USDA regulations implementing the Privacy Act are found in 7 CFR, 
subtitle A, part 1, subpart G. Contracting officers shall follow these 
regulations when responding to requests for information or awarding 
contracts that will involve the design, development, or operation of a 
system of records on individuals to accomplish agency functions.



424.104  Contract clauses.

    When applicable, the contracting officer shall insert the clause at 
452.224-70, Confidentiality of Information, in contracts involving 
confidential information.



                Subpart 424.2_Freedom of Information Act



424.203  Policy.

    USDA regulations implementing the Freedom of Information Act are 
found in 7 CFR, Subtitle A, Part 1, Subpart A. Contracting officers 
shall follow these regulations when responding to requests for 
information.

[70 FR 48, Jan. 3, 2005]



PART 425_FOREIGN ACQUISITION--Table of Contents




                 Subpart 425.1_Buy American Act_Supplies

Sec.
425.102 [Reserved]
425.103 Exceptions.
425.104 Nonavailable articles.
425.105 Determining reasonableness of cost.
425.108 [Reserved]

          Subpart 425.2_Buy American Act_Construction Materials

425.202 Exceptions.
425.203-425.204 [Reserved]

Subparts 425.3-425.4 [Reserved]

                      Subpart 425.6_Trade Sanctions

425.602 Exceptions.

Subpart 425.9 [Reserved]

        Subpart 425.10_Additional Foreign Acquisition Regulations

425.1001 Waiver of right to examination of records.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                 Subpart 425.1_Buy American Act_Supplies

    Source: 70 FR 48, Jan. 3, 2005, unless otherwise noted.



425.102  [Reserved]



425.103  Exceptions.

    (a) The Senior Procurement Executive (SPE) shall make the 
determination prescribed in FAR 25.103(a).
    (b) Copies of determinations of nonavailability in accordance with 
FAR 25.103(b)(2) or 25.202(a)(2), for articles, material or supplies not 
listed in FAR 25.104, may be submitted to the SPE for submission to the 
Civilian Agency Acquisition Council (CAAC).



425.104  Nonavailable articles.

    Information required by FAR 25.104(b) shall be submitted to the SPE 
for submission to the CAAC.



425.105  Determining reasonableness of cost.

    The SPE may make the determination prescribed in FAR 25.105(a). 
Requests for a determination by the SPE shall be submitted by the HCA, 
in writing, and shall provide a detailed justification supporting why 
evaluation factors higher than those listed in FAR 25.102(b)(1) and (2) 
should be applied to determine whether the offered price of a domestic 
end product is unreasonable.



425.108  [Reserved]



          Subpart 425.2_Buy American Act_Construction Materials



425.202  Exceptions.

    (a) The SPE shall make the determination prescribed in FAR 
25.202(a)(1).
    (b) If a contracting officer proposes that the use of a particular 
domestic

[[Page 131]]

construction material should be waived for a contract on the grounds 
that its use would be impracticable, the contracting officer shall 
submit a proposed determination with supporting information through the 
HCA to the SPE for approval or disapproval.

[63 FR 26995, May 15, 1998, as amended at 70 FR 48, Jan. 3, 2005]



425.203-425.204  [Reserved]

Subparts 425.3-425.4 [Reserved]



                      Subpart 425.6_Trade Sanctions



425.602  Exceptions.

    The Secretary, without power of redelegation, has the authority to 
make the necessary determination(s) and authorize award(s) of 
contract(s) in accordance with FAR 25.602(b).

[70 FR 48, Jan. 3, 2005]

Subpart 425.9 [Reserved]



        Subpart 425.10_Additional Foreign Acquisition Regulations



425.1001  Waiver of right to examination of records.

    The SPE shall make the determination under FAR 25.1001(a)(2)(iii).

[70 FR 48, Jan. 3, 2005]



PART 426_OTHER SOCIOECONOMIC PROGRAMS--Table of Contents




Subpart 426.70 [Reserved]

[[Page 132]]



              SUBCHAPTER E_GENERAL CONTRACTING REQUIREMENTS





PART 427_PATENTS, DATA, AND COPYRIGHTS--Table of Contents




    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).



                          Subpart 427.1_General



427.104  General guidance.

    As used in FAR part 27, the agency head or agency head designee is 
the Senior Procurement Executive, except under FAR 27.306(a) and (b). 
Under FAR 27.306(a) and (b), the agency head is the Secretary without 
power of redelegation.

[61 FR 53646, Oct. 15, 1996]



PART 428_BONDS AND INSURANCE--Table of Contents




           Subpart 428.1_Bonds and Other Financial Protections

Sec.
428.101 Bid guarantees.
428.101-1 Policy on use.
428.106 Administration.
428.106-6 Furnishing information.

           Subpart 428.2_Sureties and Other Security for Bonds

428.203 Acceptability of individual sureties.
428.204 Alternatives in lieu of corporate or individual sureties.
428.204-2 Certified or cashier's checks, bank drafts, money orders, or 
          currency.

                         Subpart 428.3_Insurance

428.307 Insurance under cost-reimbursement contracts.
428.307-1 Group insurance plans.
428.310 Contract clause for work on a Government installation.
428.370 Government-owned vehicles operated in foreign countries.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



           Subpart 428.1_Bonds and Other Financial Protections



428.101  Bid guarantees.



428.101-1  Policy on use.

    The Senior Procurement Executive may authorize class waivers of the 
requirement to obtain bid guarantees.



428.106  Administration.



428.106-6  Furnishing information.

    Heads of contracting activities (HCA's) or their designees may 
furnish certified copies of bonds and the contracts for which they were 
given as provided by FAR 28.106-6(c). Requesters may be required to pay 
costs of certification and copying established by the Departmental Fee 
Schedule for records requests (7 CFR part 1, subpart A, appendix A).



           Subpart 428.2_Sureties and Other Security for Bonds



428.203  Acceptability of individual sureties.

    Evidence of possible criminal or fraudulent activities by an 
individual surety shall be reported to the Office of Inspector General 
in accordance with Departmental Regulations (1700 series).



428.204  Alternatives in lieu of corporate or individual sureties.

    HCA's shall establish procedures to ensure protection and conveyance 
of deposited securities of the types listed in FAR 28.204-1 through 
28.204-3.



428.204-2  Certified or cashier's checks, bank drafts, money orders, or currency.

    The contracting officer shall insert the provision at 452.228-70, 
Alternative Forms of Security, in a solicitation if a bond is required.

[[Page 133]]



                         Subpart 428.3_Insurance



428.307  Insurance under cost-reimbursement contracts.



428.307-1  Group insurance plans.

    Under cost-reimbursement contracts, before buying insurance under a 
group insurance plan, the contractor shall submit the plan to the 
contracting officer for review. During review, the contracting officer 
shall use all sources of information available, such as audits, industry 
practice, or other sources of information, to determine whether 
acceptance of the plan submitted would be in the Government's best 
interest.



428.310  Contract clause for work on a Government installation.

    The contracting officer shall insert the clause at 452.228-71, 
Insurance Coverage, in solicitations and contracts which include the 
clause at FAR 52.228-5, Insurance--Work on a Government Installation. If 
property liability insurance is required, the contracting officer shall 
use the clause with its Alternate I.



428.370  Government-owned vehicles operated in foreign countries.

    USDA is authorized to obtain insurance to cover liability incurred 
by any of its employees while acting within the scope of their 
employment and operating a Government-owned vehicle in a foreign 
country. (7 U.S.C. 2262).

                           PART 429 [RESERVED]



PART 430_COST ACCOUNTING STANDARDS ADMINISTRATION--Table of Contents




Sec.
430.070 Definitions.

                 Subpart 430.2_CAS Program Requirements

430.201 Contract requirements.
430.201-5 Waiver.
430.202 Disclosure requirements.
430.202-2 Impracticality of submission.
430.202-8 Subcontractor Disclosure Statements.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



430.070  Definitions.

    ACO, as used in this part and in FAR part 30, means administrative 
contracting officer as described in FAR part 42.



                 Subpart 430.2_CAS Program Requirements



430.201  Contract requirements.



430.201-5  Waiver.

    The Senior Procurement Executive (SPE), without the authority to 
further redelegate, is authorized to request the Cost Accounting 
Standards Board to waive the application of the Cost Accounting 
Standards (CAS). Contracting officers shall prepare waiver requests in 
accordance with 48 CFR chapter 99 (Appendix B, FAR loose-leaf edition), 
subsection 9903.201-5, and submit them to the SPE through the head of 
the contracting activity (HCA).



430.202  Disclosure requirements.



430.202-2  Impracticality of submission.

    (a) The Secretary, without the power to delegate, is authorized to 
determine, in accordance with FAR part 99 (Appendix B), subsection 
9903.202-2, that the Disclosure Statement is impractical to secure and 
to authorize award without obtaining the Disclosure Statement.
    (b) The request for this determination is to be prepared in 
accordance with FAR part 99 (Appendix B), subsection 9903.202-2 and is 
to contain the proposed report to the CASB.
    (c) Requests for a determination under paragraph (a) of this section 
shall be prepared by the contracting officer and submitted through the 
HCA to the SPE for concurrence and submittal to the Secretary.



430.202-8  Subcontractor Disclosure Statements.

    (a) The Secretary, without the power to redelegate, is authorized to 
determine that the Disclosure Statement for a subcontractor is 
impractical to secure and to authorize award without obtaining the 
Disclosure Statement.
    (b) Requests for this determination are to be prepared and forwarded 
as described in 430.202-2.

[[Page 134]]



PART 431_CONTRACT COST PRINCIPLES AND PROCEDURES--Table of Contents




    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).



                       Subpart 431.1_Applicability



431.101  Objectives.

    (a) The SPE is designated as the official authorized to give advance 
approval of an individual deviation concerning cost principles.
    (b) The SPE is designated as the official authorized to give advance 
approval of a class deviation concerning cost principles after 
coordination with the Civilian Agency Acquisition Council.
    (c) Requests for advance approval of class deviations concerning 
cost principles must be submitted to the SPE through the HCA.

[61 FR 53646, Oct. 15, 1996]



PART 432_CONTRACT FINANCING--Table of Contents




Sec.
432.001 Definitions.
432.003 Simplified acquisition procedures financing.
432.006 Reduction or suspension of contract payments upon finding of 
          fraud.
432.006-2 Definitions.
432.006-3 Responsibilities.
432.006-4 Procedures.
432.006-5 Reporting.
432.007 Contract financing payments.

          Subpart 432.1_Non-Commercial Item Purchase Financing

432.102 Description of contract financing methods.
432.103 Progress payments under construction contracts.
432.111 Contract clauses for non-commercial purchases.
432.113 Customary contract financing.
432.114 Unusual contract financing.

            Subpart 432.2_Commercial Item Purchase Financing

432.202 General.
432.202-1 Policy.
432.202-4 Security for Government financing.
432.206 Solicitation provisions and contract clauses.
432.207 Administration and payment of commercial financing payments.

          Subpart 432.3_Loan Guarantees for Defense Production

432.301 Definitions.

         Subpart 432.4_Advance Payments for Non-Commercial Items

432.402 General.
432.406 Letters of credit.
432.407 Interest.
432.412 Contract clause.

                      Subpart 432.6_Contract Debts

432.601 Definition.
432.616 Compromise actions.

                     Subpart 432.7_Contract Funding

432.703 Contract funding requirements.
432.703-3 Contracts crossing fiscal years.
432.770 USDA specific funding limitations.

                   Subpart 432.8_Assignment of Claims

432.802 Conditions.
432.803 Policies.
432.805 Procedure.
432.806 Contract clauses.

                      Subpart 432.9_Prompt Payment

432.904 Determining payment due dates.

                Subpart 432.10_Performance-Based Payments

432.1007 Administration and payment of performance-based payments.

    Authority: 40 U.S.C. 121, 41 U.S.C. 421.

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



432.001  Definitions.

    The agency contract finance office is the office, other than the 
office of the requisitioner, providing funding or performing funding 
record keeping for the contract action.
    Responsible fiscal authority is that officer in the agency contract 
finance office with the responsibility to ensure that adequate funds are 
available and usable for the intended purpose.



432.003  Simplified acquisition procedures financing.

    (a) The chief of the contracting office may approve contract 
financing on a contract to be entered under the simplified acquisition 
procedures. Class approvals may not be made.

[[Page 135]]

    (b) The signed approval must contain the supporting rationale for 
the action and an estimate of the cost and/or risk to the government.



432.006  Reduction or suspension of contract payments upon finding of fraud.



432.006-2  Definitions.

    (a) The USDA remedy coordination official (RCO) is the Assistant 
Secretary for Administration.
    (b) For the purposes of this part, head of the agency means, 
exclusively, the Secretary or the Deputy Secretary.



432.006-3  Responsibilities.

    When a contracting officer suspects that a request for advance, 
partial, or progress payment is based on fraud, the request shall be 
referred directly to the Office of Inspector General (OIG) in accordance 
with their instructions. A copy of the referral shall be submitted 
through the head of the contracting activity (HCA) to the Senior 
Procurement Executive (SPE).



432.006-4  Procedures.

    (a) Immediately upon submittal of the referral described in 432.006-
3, the HCA and the contracting officer shall confer with the SPE and 
representatives of the OIG to discuss the potential for reduction or 
suspension of further payments based on the considerations listed in FAR 
32.006-4(d) (1) through (5).
    (b) The SPE will determine whether the contractor has contracts with 
other Departments or contracting activities and will involve them, as 
necessary, in the decision making process.
    (c) The OIG will determine the need for and the extent of an 
investigation.
    (d) Immediately upon completion of the OIG investigation (or, if 
deemed necessary by the OIG and the SPE, before completion of the 
investigation) the SPE, in coordination with the HCA, the contracting 
officer, and the OIG, shall make a report on the action to the RCO.
    (e) Upon receipt of the report, the RCO will submit a recommendation 
to the Secretary.
    (f) Upon receipt of the RCO's report the Secretary will:
    (1) Notify the contractor in writing, allowing 30 calendar days 
after receipt of the notice, that the contractor may submit in writing 
information and arguments in opposition to the recommendation; and
    (2) Consider the RCO's recommendation, the SPE's report, the 
response of the contractor, and any other relevant information in order 
to make an appropriate final determination.
    (g) This determination will be provided to the contractor and to the 
SPE for distribution to the agencies involved and for appropriate action 
under the determination.
    (h) The determination and the supporting documentation will be 
placed in the contract file(s) and a copy will be maintained by the SPE.
    (i) The contracting officer will advise the SPE of the actual date 
of the reduction or suspension action.
    (j) Not later than 150 calendar days after the actual date of the 
reduction or suspension action, the SPE will prepare for the RCO a 
review of the agency head's determination, and will propose a 
recommendation from the RCO to the agency head as to whether the 
reduction or suspension action should continue. The RCO will submit the 
recommendation (including a recommendation for the time period of a 
follow up review) to the agency head. This recommendation will be 
considered by the Secretary and handled as a final action described in 
paragraph (f) of this section.
    (k) The contract may not be closed nor final payment made prior to a 
final determination by the Secretary.



432.006-5  Reporting.

    The annual report required by FAR 32.006-5 is to be prepared by the 
SPE and to be submitted to the Secretary within 90 calendar days after 
the end of the fiscal year. When signed by the Secretary, the report is 
to be maintained by the SPE.



432.007  Contract financing payments.

    The HCA may prescribe, on a case-by-case basis, a shorter period for 
financing payments.

[61 FR 53646, Oct. 15, 1996. Redesignated at 70 FR 48, Jan. 3, 2005]

[[Page 136]]



          Subpart 432.1_Non-Commercial Item Purchase Financing



432.102  Description of contract financing methods.

    Progress payments based on a percentage or stage of completion are 
authorized for use as a payment method under USDA contracts or 
subcontracts for construction, alteration or repair, and shipbuilding 
and conversion. Such payments also are authorized for service contracts, 
if the contracting officer determines that progress payments based on 
costs are not practicable and adequate safeguards are provided to 
administer progress payments based on a percentage or stage of 
completion. For all other contracts, progress payment provisions shall 
be based on costs except that the HCA may authorize progress payments 
based on a percentage or stage of completion on a case-by-case basis. 
Each authorization by the HCA shall include a determination and finding 
that progress payments based on costs cannot be employed practically and 
that there are adequate safeguards provided for the administration of 
progress payments based on a percentage or stage of completion.



432.103  Progress payments under construction contracts.

    (a) When approving a progress payment under a construction contract, 
the contracting officer shall indicate the amount to be paid by the 
payment office and include in the contract file the rationale in support 
of the payment.
    (b) When a retainage is made on a progress payment under a 
construction contract, the contracting officer shall place in the 
contract file a written determination stating the reason(s) for the 
retainage.
    (c) When a progress payment under a construction contract has been 
approved, the amount to be paid, the amount of any retainage withheld, 
and the reason(s) for the retainage shall be provided to the contractor 
by the contracting officer in writing before the payment due date.
    (d) When the contractor, under a fixed-price construction contract, 
furnishes evidence to the contracting officer that the surety has been 
paid in full for bond premiums and requests reimbursement, the first 
subsequent progress payment shall include the total amount attributable 
to such bond premiums and the Government shall pay that amount in full. 
This amount paid for the bond premiums is not an amount in addition to 
the stated contract price.



432.111  Contract clauses for non-commercial purchases.

    The contracting officer shall insert the clause at 452.232-70, 
Reimbursement for Bond Premiums--Fixed Price Construction Contracts, 
whenever the clause at FAR 52.232-5, Payments under Fixed-Price 
Construction Contracts, is used in a contract.

[61 FR 53646, Oct. 15, 1996, as amended at 63 FR 26995, May 15, 1998]



432.113  Customary contract financing.

    The contracting officer may determine the necessity for customary 
contract financing. The determination and finding that customary 
contract financing is needed shall be placed in the contract file.



432.114  Unusual contract financing.

    The HCA is authorized to approve unusual contract financing. The 
signed determination and finding supporting this approval shall be 
included in the contract file.



            Subpart 432.2_Commercial Item Purchase Financing



432.202  General.



432.202-1  Policy.

    In the case of unusual contract financing, the approval by the HCA 
shall be recorded in a determination and finding and maintained in the 
contract file.



432.202-4  Security for Government financing.

    Prior to determining that an offeror's financial condition is 
adequate security, the contracting officer must obtain the concurrence 
of the funding activity in the proposed determination.

[[Page 137]]



432.206  Solicitation provisions and contract clauses.

    The responsibility for administration of the liquidation provisions 
of a contract may not be transferred from the contracting officer.



432.207  Administration and payment of commercial financing payments.

    The responsibility for receiving, reviewing, and approval of 
contract financing requests may not be transferred from the contracting 
officer.



          Subpart 432.3_Loan Guarantees for Defense Production



432.301  Definitions.

    Within this subpart, the ``agency'' or ``guaranteeing agency'' is 
the ``head of the contracting activity'' (HCA) and may not be 
redelegated.



         Subpart 432.4_Advance Payments for Non-Commercial Items



432.402  General.

    The HCA is designated as the individual responsible for making the 
findings and determination, and for approval of the contract terms 
concerning advance payments.



432.406  Letters of credit.

    The HCA is designated as the individual responsible for coordination 
with the Department of Treasury concerning letters of credit.



432.407  Interest.

    (a) The HCA is designated as the individual who may authorize, on a 
case by case basis, advance payments without interest for the contract 
types described in FAR 32.407(d)(1), (2), (3), and (4). The signed 
determination and findings supporting these authorizations shall be 
included in the contract files.
    (b) The SPE is designated as the individual who may authorize 
advance payments without interest other than those described in 
paragraph (a) of this section.



432.412  Contract clause.

    The decision to use Alternates I or III to clause 52.232-12 must be 
supported by a determination and finding.



                      Subpart 432.6_Contract Debts



432.601  Definition.

    Responsible official means the contracting officer.



432.616  Compromise actions.

    Compromise of a debt within the proceedings under appeal to the 
Civilian Board of Contract Appeals is the responsibility of the 
contracting officer.

[72 FR 31438, June 7, 2007]



                     Subpart 432.7_Contract Funding



432.703  Contract funding requirements.



432.703-3  Contracts crossing fiscal years.

    Funds appropriated to USDA may be used for one-year contracts which 
are to be performed in two fiscal years so long as the total amount for 
such contracts is obligated in the year for which the funds are 
appropriated (7 U.S.C. 2209c).



432.770  USDA specific funding limitations.

    (a) The USDA is authorized to subscribe for newspapers as may be 
necessary to carry out its authorized work: Provided, that such 
subscriptions shall not be made unless provision is made therefor in the 
applicable appropriation and the cost thereof is not in excess of 
limitations prescribed therein (7 U.S.C. 2258).
    (b) The expenditure of any USDA appropriation for any consulting 
service through any contract, pursuant to section 3109 of Title 5 of the 
U.S. Code shall be limited to those contracts where such expenditures 
are a matter of public record and available for public inspection, 
except where otherwise provided under existing law, or under existing 
Executive Order issued pursuant to existing law (7 U.S.C. 2225a).

[[Page 138]]



                   Subpart 432.8_Assignment of Claims



432.802  Conditions.

    Written notices of assignment and a true copy of the assigned 
instrument are to be sent to the contracting officer rather than the 
agency head. Other copies are distributed as directed in FAR 32.802.



432.803  Policies.

    The HCA may make a determination of need to include a no-setoff 
commitment in a contract.



432.805  Procedure.

    The information described in FAR 32.805 shall be filed with the 
contracting officer.



432.806  Contract clauses.

    The contracting officer may make the determination whether to 
include the clause at FAR 52.232-23 in any purchase order expected to 
exceed the micro-purchase threshold.



                      Subpart 432.9_Prompt Payment



432.904  Determining payment due dates.

    The payment terms for supplies and services on the Procurement List 
and provided by a Javits-Wagner-O'Day Act participating nonprofit agency 
are governed by FAR 8.709.

[61 FR 53646, Oct. 15, 1996. Redesignated at 70 FR 48, Jan. 3, 2005]



                Subpart 432.10_Performance-Based Payments



432.1007  Administration and payment of performance-based payments.

    The responsibility for receiving, reviewing, and approval of 
performance-based payment requests may not be transferred from the 
contracting officer.



PART 433_PROTESTS, DISPUTES AND APPEALS--Table of Contents




                         Subpart 433.1_Protests

Sec.
433.102 General.
433.103 Protests to the agency.
433.104 [Reserved]

                   Subpart 433.2_Disputes and Appeals

433.203 Applicability.
433.203-70 Civilian Board of Contract Appeals.
433.209 Suspected fraudulent claims.

    Authority: 40 U.S.C. 121, 41 U.S.C. 421.

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                         Subpart 433.1_Protests



433.102  General.

    (a) The Senior Procurement Executive (SPE) is responsible for 
coordinating the handling of bid protests lodged with the Government 
Accountability Office (GAO).
    (b) The head of the contracting activity (HCA), on a non-delegable 
basis, may resolve protests and authorize reimbursement of costs in 
accordance with FAR 33.102(b).

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 48, Jan. 3, 2005]



433.103  Protests to the agency.

    (a) Actual or prospective bidders or offerors may file protests 
either with the HCA, as provided by 433.102(b), or with the contracting 
officer. Protesters who file protests with the HCA shall furnish a 
complete copy to the contracting officer no later than 1 day after the 
protest is filed with the HCA.
    (b) When a protest is received, the adjudicating official shall take 
prompt action towards resolution and notify the protester in writing of 
the action taken. The written final decision shall include a paragraph 
substantially as follows:

    This decision shall be final and conclusive unless a further written 
notice of protest is filed with the Government Accountability Office in 
accordance with 4 CFR part 21. Neither the filing of a protest with USDA 
nor the filing of a protest with the Government Accountability Office 
affects your right to file an action in a district court of the United 
States or the United States Court of Federal Claims.

[61 FR 53646, Oct. 15, 1996, as amended at 70 FR 48, Jan. 3, 2005]

[[Page 139]]



433.104  [Reserved]



                   Subpart 433.2_Disputes and Appeals



433.203  Applicability.

    The Assistant Secretary for Administration is authorized to 
determine the applicability of the Contract Disputes Act to contracts 
with foreign governments pursuant to FAR 33.203.



433.203-70  Civilian Board of Contract Appeals.

    The organization, jurisdiction, and functions of the Civilian Board 
of Contract Appeals, together with its Rules of Procedure, are set out 
in 48 CFR part 6101.

[72 FR 31438, June 7, 2007]



433.209  Suspected fraudulent claims.

    The contracting officer shall refer all matters related to suspected 
fraudulent claims by a contractor under the conditions in FAR 33.209 to 
the Office of Inspector General for additional action or investigation.

[[Page 140]]



             SUBCHAPTER F_SPECIAL CATEGORIES OF CONTRACTING





PART 434_MAJOR SYSTEM ACQUISITION--Table of Contents




                          Subpart 434.0_General

Sec.
434.001 Definitions.
434.002 Policy.
434.003 Responsibilities.
434.004 Acquisition strategy.
434.005 General requirements.
434.005-6 Full production.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 70 FR 49, Jan. 3, 2005, unless otherwise noted.



                          Subpart 434.0_General



434.001  Definitions.

    Pursuant to OMB Circular No. A-109 (A-109) and the definition at FAR 
2.101, within USDA, a system shall be considered a major system if:
    (a) The total acquisition costs (for information technology, life 
cycle costs) are estimated to be $50 million or more, or
    (b) The system, regardless of estimated acquisition or life cycle 
costs, has been specifically designated to be a major system by the USDA 
Acquisition Executive or by the Major Information Technology Systems 
Executive.



434.002  Policy.

    In addition to the policy guidance at FAR 34.002 and other parts of 
the FAR, the policies outlined in paragraph 6 of A-109 should serve as 
guidelines for all contracting activities in planning and developing 
systems, major or otherwise.



434.003  Responsibilities.

    (a) The Secretary of Agriculture or other designated USDA key 
executive is responsible for making four key decisions in each major 
system acquisition process. These are listed in paragraph 9 of A-109 and 
elaborated on in paragraphs 10 through 13. The key executives of USDA 
(Secretary, Deputy Secretary, Under Secretaries and Assistant 
Secretaries) individually or as a group will participate in this 
decision making process.
    (b) The Chief Information Officer (CIO) is the Major Information 
Technology Systems Executive. For acquisitions of information 
technology, the CIO will ensure that A-109 is implemented in USDA and 
that the management objectives of the Circular are realized. The CIO is 
responsible for designating the program manager for each major 
information technology system acquisition, designating an acquisition to 
be a major information technology system acquisition, and approving the 
written charter and project control system for each major information 
technology system acquisition.
    (c) The Assistant Secretary for Administration (ASA) is the USDA 
Acquisition Executive for major system acquisitions other than 
acquisitions of information technology. The ASA will ensure that A-109 
is implemented in USDA and that the management objectives of the 
Circular are realized. The ASA is responsible for designating the 
program manager for each major system acquisition, designating an 
acquisition to be a major system acquisition, and approving the written 
charter and project control system for each major system acquisition.
    (d) Heads of contracting activities must:
    (1) Ensure compliance with the requirements of A-109, FAR Part 34 
and AGAR Part 434.
    (2) Ensure that potential major system acquisitions are brought to 
the attention of the USDA Acquisition Executive or the Major Information 
Technology Systems Executive, as appropriate.
    (3) Recommend qualified candidates for designation as program 
managers for each major system acquisition within their jurisdiction.
    (4) Ensure that program managers fulfill their responsibilities and 
discharge their duties.
    (5) Cooperate with the ASA and Major Information.
    Technology Systems Executive in implementing the requirements of A-
109.

[[Page 141]]

    (e) The program manager is responsible for planning and executing 
the major system acquisition, ensuring appropriate coordination with the 
USDA Acquisition Executive and Major Information Technology Systems 
Executive and other key USDA executives.



434.004  Acquisition strategy.

    (a) The program manager will develop, in coordination with the 
Acquisition Executive or Major Information Technology Systems Executive, 
a written charter outlining the authority, responsibility, 
accountability, and budget for accomplishing the proposed objective.
    (b) The program manager will develop, subject to the approval of the 
Acquisition Executive or Major Information Technology Systems Executive, 
a project control system to schedule, monitor, and regularly report on 
all aspects of the project. The control system shall establish reporting 
periods and milestones consistent with the key decisions listed in 
paragraph 9 of A-109.
    (c) Upon initiation of the project, the program manager will report 
regularly to the Acquisition Executive or Major Information Technology 
Systems Executive.
    (d) Specific procedures and requirements for information technology 
systems are included in the USDA Information Technology Capital Planning 
and Investment Control Guide which can be accessed on the USDA OCIO Web 
site at http://www.ocio.usda.gov.



434.005  General requirements.



434.005-6  Full production.

    The Secretary or the USDA key executive designated by the Secretary 
for the specific program is the agency head for the purposes of FAR 
34.005-6.



PART 435_RESEARCH AND DEVELOPMENT CONTRACTING--Table of Contents




    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).



435.010  Scientific and technical reports.

    Research and development contracts shall contain a provision 
requiring that the contractor send copies of all scientific and 
technical reports to the National Technical Information Service at the 
address indicated in FAR 35.010(b). The release of research and 
development contract results to other government activities and to the 
private sector is subject to the provisions of FAR subpart 4.4.

[61 FR 53646, Oct. 15, 1996]



PART 436_CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS--Table of Contents




      Subpart 436.2_Special Aspects of Contracting for Construction

Sec.
436.201 Evaluation of contractor performance.
436.203 Government estimate of construction costs.
436.204 Disclosure of the magnitude of construction projects.
436.205 Statutory cost limitations.
436.209 Construction contracts with architect-engineer firms.
436.213 Special procedures for sealed bidding in construction 
          contracting.
436.213-2 Presolicitation notices.

Subpart 436.3 [Reserved]

                     Subpart 436.5_Contract Clauses

436.500 Scope of subpart.
436.571 Prohibition against the use of lead-based paint.
436.572 Use of premises.
436.573 Archeological or historic sites.
436.574 Control of erosion, sedimentation, and pollution.
436.575 Maximum workweek-construction schedule.
436.576 Samples and certificates.
436.577 Emergency response.
436.578 [Reserved]
436.579 Opted timber sale road requirements.

                Subpart 436.6_Architect-Engineer Services

436.601 Policy.
436.601-3 Applicable contracting procedures.
436.602 Selection of firms for architect-engineer contracts.
436.602-1 Selection criteria.
436.602-2 Evaluation boards.
436.602-3 Evaluation board functions.
436.602-4 Selection authority.
436.602-5 Short selection process for contracts not to exceed the 
          simplified acquisition threshold.
436.603 Collecting data on and appraising firms' qualifications.

[[Page 142]]

436.604 Performance evaluation.
436.605 Government cost estimate for architect-engineer work.
436.609 Contract clauses.
436.609-1 Design within funding limitations.
436.670 Firms ineligible for award--construction.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



      Subpart 436.2_Special Aspects of Contracting for Construction



436.201  Evaluation of contractor performance.

    Preparation of performance evaluation reports. In addition to the 
requirements of FAR 36.201, performance evaluation reports shall be 
prepared for indefinite-delivery type contracts when either the contract 
maximum or the contracting activity's reasonable estimate of services to 
be ordered exceeds $500,000.00. For these contracts, performance 
evaluation reports shall be prepared for each order at the time of final 
acceptance of the work under the order.



436.203  Government estimate of construction costs.

    For acquisitions using sealed bid procedures, the contracting 
officer may disclose the overall amount of the Government's estimate of 
construction costs following identification of the responsive bid most 
advantageous to the Government; verification of that bid's price 
reasonableness; and verification of the bidder's responsibility. For 
acquisitions using other than sealed bid procedures (e.g., negotiation), 
the contracting officer may disclose the overall amount of the estimate 
after contract award.



436.204  Disclosure of the magnitude of construction projects.

    In the case of indefinite-delivery type contracts, the reasonable 
estimate of work to be done or the maximum in the solicitation, both 
including all options, is to be used to select the price range. 
Contracting officers may elect to use both a price range for the base 
period of services and the total, inclusive of options, to best describe 
the magnitude of the solicitation.



436.205  Statutory cost limitations.

    (a) When it appears that funds available for a project may be 
insufficient for all the desired features of construction, the 
contracting officer may provide in the solicitation for a base bid item 
covering the work generally as specified and for one or more additive or 
deductive bid items which progressively add or omit specified features 
of the work in a stated order of priority. In this case, the contracting 
officer shall insert the provision at 452.236-70, Additive or Deductive 
Items, in solicitations for construction.
    (b) In the alternative to the process in paragraph (a) of this 
section, the contracting officer may use the policies and procedures 
found in FAR 17.2.



436.209  Construction contracts with architect-engineer firms.

    The head of the contracting activity (HCA) is authorized to approve 
the award of a contract to construct a project, in whole or in part, to 
the firm (inclusive of its subsidiaries or affiliates) that designed the 
project.



436.213  Special procedures for sealed bidding in construction contracting.



436.213-2  Presolicitation notices.

    The authority to waive a presolicitation notice is restricted to the 
HCA.

[63 FR 26995, May 15, 1998]

Subpart 436.3 [Reserved]



                     Subpart 436.5_Contract Clauses



436.500  Scope of subpart.

    This subpart prescribes clauses for insertion in USDA solicitations 
and contracts for construction and for dismantling, demolition, or 
removal of improvements or structures. The contracting officer shall use 
the clauses as prescribed, in contracts that exceed the simplified 
acquisition threshold. The contracting officer may use the clauses if 
the contract amount is expected to be within the simplified acquisition 
threshold.

[[Page 143]]



436.571  Prohibition against the use of lead-based paint.

    The contracting officer shall insert the clause at 452.236-71, 
Prohibition Against the Use of Lead-Based Paint, in solicitations and 
contracts, if the work involves construction or rehabilitation 
(including dismantling, demolition, or removal) of residential 
structures. This clause may be used in contracts for other than 
residential structures.



436.572  Use of premises.

    The contracting officer shall insert the clause at 452.236-72, Use 
of Premises, if the contractor will be permitted to use land or premises 
administered by USDA.



436.573  Archeological or historic sites.

    The contracting officer shall insert the clause at 452.236-73, 
Archeological or Historic Sites, if the contractor will be working in an 
area where such sites may be found. Use of the clause is optional in 
service contracts for on-the-ground work, e.g. reforestation, 
silvicultural, land stabilization, or other agricultural-related 
projects.



436.574  Control of erosion, sedimentation, and pollution.

    The contracting officer shall insert the clause at 452.236-74, 
Control of Erosion, Sedimentation and Pollution, if there is a need for 
applying environmental controls in the performance of work. Use of the 
clause is optional in service contracts for on-the-ground e.g., 
reforestation, silvicultural, land stabilization, or other agricultural-
related projects.



436.575  Maximum workweek-construction schedule.

    The contracting officer shall insert the clause at 452.236-75, 
Maximum Workweek-Construction Schedule, if the clause at FAR 52.236-15 
is used and the contractor's work schedule is restricted by access to 
the facility or must be coordinated with the schedule of contract 
administration personnel.

[63 FR 26996, May 15, 1998]



436.576  Samples and certificates.

    The contracting officer shall insert the clause at 452.236-76, 
Samples and Certificates, in all contracts.



436.577  Emergency response.

    The contracting officer may insert the clause at 452.236-77, 
Emergency Response, in construction contracts awarded for the Forest 
Service.



436.578  [Reserved]



436.579  Opted timber sale road requirements.

    The contracting officer shall insert the clause at 452.236-79, Opted 
Timber Sale Road Requirements, in road construction contracts resulting 
from a timber sale turnback.



                Subpart 436.6_Architect-Engineer Service



436.601  Policy.



436.601-3  Applicable contracting procedures.

    The technical official's listing of areas where recovered materials 
cannot be used shall be referred to the contracting activity's official 
designated in accordance with FAR 23.404. A copy of the listing and of 
any approval or disapproval by that official is to be retained in the 
solicitation file.



436.602  Selection of firms for architect-engineer contracts.



436.602-1  Selection criteria.

    The HCA is authorized to approve the use of design competition under 
the conditions in FAR 36.602-1(b).



436.602-2  Evaluation boards.

    HCA's shall establish written procedures for providing permanent or 
ad hoc architect-engineer evaluation boards as prescribed in FAR 36.602-
2. The procedures may provide for the appointment of private 
practitioners of architecture, engineering, or related professions when 
such action is determined by the HCA to be essential to meet the 
Government's minimum needs.

[[Page 144]]



436.602-3  Evaluation board functions.

    The selection report required in FAR 36.602-3(d) shall be prepared 
for the approval of the HCA. The HCA may authorize an acquisition 
official above the level of the contracting officer to execute the 
required approval.



436.602-4  Selection authority.

    (a) The HCA shall serve as the selection authority in accordance 
with FAR 36.602-4. The HCA may authorize an acquisition official above 
the level of the contracting officer to serve as the selection 
authority.
    (b) A copy of the final selection, inclusive of the supporting 
documents, shall be provided to the contracting officer and maintained 
in the solicitation file.



436.602-5  Short selection process for contracts not to exceed the simplified acquisition threshold.

    The HCA may include either or both procedures in FAR 36.602-5 in the 
procedures for evaluation boards.



436.603  Collecting data on and appraising firms' qualifications.

    (a) HCA's which require architect-engineer services shall establish 
procedures to comply with the requirements of FAR 36.603.
    (b) The procedures shall include a list of names, addresses, and 
phone numbers of offices or boards assigned to maintain architect-
engineer qualification data files. The list shall be updated annually.



436.604  Performance evaluation.

    Preparation of performance evaluation reports. (a) In addition to 
the requirements of FAR 36.604, performance evaluation reports shall be 
prepared for indefinite-delivery type contracts when either the contract 
maximum or the contracting activities reasonable estimate of services to 
be ordered exceeds $25,000.00. For these contracts, performance 
evaluation reports shall be prepared for each order at the time of final 
acceptance of the work under the order.
    (b) The contracting officer may require a performance evaluation 
report on the work done by the architect-engineer after the completion 
of or during the construction of the designed project.



436.605  Government cost estimate for architect-engineer work.

    The contracting officer may release the Government's total cost 
estimate in accordance with FAR 36.605(b).



436.609  Contract clauses.



436.609-1  Design within funding limitations.

    (a) Should the head of the contracting activity appoint a designee 
to make the determination in FAR 36.609-1(c)(1), the appointment may be 
to one no lower than the official authorized to commit program funds for 
the work being acquired.
    (b) The contracting officer, with the advice of appropriate 
technical representatives, may make the determination in FAR 36.609-
1(c)(2) or (3).
    (c) A copy of the determinations described in paragraph (b) and (c) 
of this section shall be maintained in the contract file.



436.670  Firms ineligible for award--construction.

    The contracting officer shall insert the clause at 452.236-80, Firms 
Ineligible For Award--Construction, in the contract for architect-
engineering services except as provided in FAR 36.209 and AGAR 436.209.



PART 437_SERVICE CONTRACTING--Table of Contents




                 Subpart 437.1_Service Contracts_General

Sec.
437.104 Personal services contracts.
437.110 Solicitation provisions and contract clauses.

             Subpart 437.2_Advisory and Assistance Services

437.203 Policy.
437.204 Guidelines for determining availability of personnel.
437.270 Solicitation provisions and contract clauses.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.

[[Page 145]]



                 Subpart 437.1_Service Contracts_General



437.104  Personal services contracts.

    USDA has the following specific statutory authorities to contract 
for personal services:
    (a) Section 706(a) of the Organic Act of 1944 (7 U.S.C. 2225) 
authorizes contracting with persons or organizations on a temporary 
basis, without regard to civil service compensation classification 
standards in 5 U.S.C., Chapter 51 and Subchapter III of Chapter 53, 
Provided:
    (1) That no expenditures shall be made unless specifically provided 
for in the applicable appropriation, and
    (2) Expenditures do not exceed any limitations prescribed in the 
appropriation.
    (b) 7 U.S.C. 1627 authorizes the Secretary of Agriculture to 
contract with technically qualified persons, firms or organizations to 
perform research, inspection, classification, technical, or other 
special services, without regard to the civil-service laws, Provided: it 
is for a temporary basis and for a term not to exceed six months in any 
fiscal year.



437.110  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert a clause substantially the 
same as the clause at 452.237-70, Loss Damage, Destruction or Repair, in 
contracts for equipment rental, whether the equipment is furnished with 
or without operator.
    (b) The contracting officer shall insert a provision substantially 
the same as the clause at 452.237-71, Pre-Bid/Pre-Proposal Conference, 
in all solicitations if a conference with prospective offerors will be 
held prior to the submittal of bids or proposals.
    (c) The contracting officer shall insert the provision at 452.237-
73, Equipment Inspection visit, in solicitations if work is to be done 
on Government equipment and an offeror's inspection is encouraged for an 
understanding of the work to be performed prior to submittal of bids or 
proposals.
    (d) The contracting officer shall insert a clause substantially the 
same as the clause at 452.237-74, Key Personnel, in contracts if 
contract performance requires identification of the contractor's key 
personnel.
    (e) The contracting officer shall insert a clause substantially the 
same as the clause at 452.237-75, Restrictions Against Disclosure, in 
service contracts (including architect-engineer contracts) requiring 
restrictions on release of information developed or obtained in 
connection with performance of the contract.



             Subpart 437.2_Advisory and Assistance Services



437.203  Policy.

    Contracting for advisory and assistance services is subject to the 
policy and procedures in Departmental Regulations (5000 series).



437.204  Guidelines for determining availability of personnel.

    The head of the contracting activity (HCA) is authorized to approve 
the use of non-Government evaluators in proposal evaluation. Each such 
decision shall be supported by a written determination in accordance 
with FAR 37.204.

[64 FR 52675, Sept. 30, 1999]



437.270  Solicitation and contract clauses.

    (a) The contracting officer shall insert a clause substantially the 
same as the clause at 452.237-76, Progress Reporting, in all contracts 
for advisory and assistance services. It may also be used in other 
service contracts.
    (b) The contracting officer shall insert a clause substantially the 
same as the clause at 452.237-78, Contracts with Consulting Firms for 
Services, in solicitations and contracts for consulting services which 
prohibit follow-on contracts with the contracting firm.

                           PART 438 [RESERVED]



PART 439_ACQUISITION OF INFORMATION TECHNOLOGY--Table of Contents




                          Subpart 439.1_General

Sec.
439.101 Policy.


[[Page 146]]


    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).



                          Subpart 439.1_General



439.101  Policy.

    (a) In addition to policy and regulatory guidance contained in the 
FAR and AGAR:
    (1) The USDA Information Technology Capital Planning and Investment 
Control Guide (CPIC) establishes requirements for the acquisition of 
information technology.
    (2) Specific thresholds at which USDA Office of the Chief 
Information Officer Information Technology Acquisition Approval is 
required have been established.
    (3) The procurement authority delegated to USDA Agencies is 
established in Departmental Regulations 5000 series.
    (4) The CPIC Guide and USDA CIO policy and procedural guidance are 
available on the USDA OCIO Web site at http://www.ocio.usda.gov. Notices 
of changes in the Information Technology Acquisition Approval Thresholds 
are also promulgated by AGAR Advisory.
    (b) Acquisition of on-line courseware libraries and learning 
management system services requires specific approval of the ASA and 
CIO. Information regarding the specific approval requirements and 
processes is promulgated by AGAR Advisory.

[70 FR 49, Jan. 3, 2005]

                           PART 440 [RESERVED]



PART 441_ACQUISITION OF UTILITY SERVICES--Table of Contents




    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).



                Subpart 441.2_Acquiring Utility Services



441.201  Policy.

    As used in FAR 41.201(d)(2)(i) and 41.201(d)(3) the Federal agency 
head designee is the head of the contracting activity.

[61 FR 53646, Oct. 15, 1996]

[[Page 147]]



                    SUBCHAPTER G_CONTRACT MANAGEMENT





PART 442_CONTRACT ADMINISTRATION--Table of Contents




  Subpart 442.1_Interagency Contract Administration and Audit Services

Sec.
442.102 Procedures.

            Subpart 442.15_Contractor Performance Information

442.1502 Policy.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



  Subpart 442.1_Interagency Contract Administration and Audit Services



442.102  Procedures.

    (a) The Office of Inspector General (OIG), Audit Division, has 
established a cross-servicing arrangement with the Defense Contract 
Audit Agency (DCAA) to provide contract audit services required by the 
FAR.
    (b) All contract audit services required by contracting officers, 
except those which can be accomplished in-house, shall be coordinated 
through the cognizant OIG Regional Inspector General--Auditing (RIG-A). 
Cognizance is determined on the basis of the contractor's location. 
There is no charge for DCAA audit services coordinated through OIG.
    (c) In order to ensure compliance with this requirement and to 
evaluate the results of audits, contracting officers shall forward to 
the RIG-A copies of all price negotiation memoranda prepared for 
contracts and contract modifications in excess of $500,000.



            Subpart 442.15_Contractor Performance Information



442.1502  Policy.

    The Contractor Performance System (CPS), developed by the National 
Institutes of Health, is designated as the single USDA-wide system for 
maintaining contractor performance/evaluation information. Use of the 
CPS is mandatory. As a minimum, the CPS shall be accessed for contractor 
past performance information as part of proposal evaluation in 
accordance with FAR subpart 15.3, and information resulting from the 
evaluation of contractor performance in accordance with FAR subpart 
42.15 shall be entered into and maintained in this system. The CPS is a 
part of the USDA Acquisition Toolkit which can be accessed from the USDA 
Procurement Homepage at http://www.usda.gov/procurement/.

[66 FR 49867, Oct. 1, 2001]

                        PARTS 443	444 [RESERVED]



PART 445_GOVERNMENT PROPERTY--Table of Contents




       Subpart 445.3_Providing Government Property to Contractors

Sec.
445.302 Providing facilities.
445.302-1 Policy.

     Subpart 445.4_Contractor Use and Rental of Government Property

445.403 Rental--Use and Charges clause.
445.407 Non-Government use of plant equipment.

Subpart 445.6 [Reserved]

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



       Subpart 445.3_Providing Government Property to Contractors



445.302  Providing facilities.



445.302-1  Policy.

    Heads of contracting activities (HCA's) are authorized to make 
determinations for providing facilities to a contractor as prescribed in 
FAR 45.302-1(a)(4).

[[Page 148]]



     Subpart 445.4_Contractor Use and Rental of Government Property



445.403  Rental--Use and Charges clause.

    HCA's are authorized to make determinations for charging rent on the 
basis of use under the Use and Charges clause in FAR 52.245-9 as 
prescribed in FAR 45.403(a).



445.407  Non-Government use of plant equipment.

    Requests for non-Government use of plant equipment as prescribed in 
FAR 45.407 shall be submitted by the HCA to the Senior Procurement 
Executive (SPE) for approval.

Subpart 445.6 [Reserved]



PART 446_QUALITY ASSURANCE--Table of Contents




    Authority: 5 U.S.C. 30 and 40 U.S.C. 486(c).



                     Subpart 446.3_Contract Clauses



446.370  Inspection and acceptance.

    The Contracting Officer shall insert the clause at 452.246-70, 
Inspection and Acceptance, in contracts where inspection and acceptance 
will be performed at the same location. The clause with its Alternate I 
is for use when inspection and acceptance will be performed at different 
locations.

[61 FR 53646, Oct. 15, 1996]



PART 447_TRANSPORTATION--Table of Contents




            Subpart 447.3_Transportation in Supply Contracts

Sec.
447.302 Place of delivery--F.O.B. point.
447.305 Solicitation provisions, contract clauses, and transportation 
          factors.
447.305-10 Packing, marking, and consignment instructions.

    Authority: 5 U.S.C. 30 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



            Subpart 447.3_Transportation in Supply Contracts



447.302  Place of delivery--F.O.B. point.

    The contracting officer shall insert a clause substantially the same 
as the clause at 452.247-70, Delivery Location, in supply contracts when 
it is necessary to specify delivery locations. If appropriate, the 
clause may reference an attachment which lists various delivery 
locations and other delivery details (e.g., quantities to be delivered 
to each location, etc.).



447.305  Solicitation provisions, contract clauses, and transportation factors.



447.305-10  Packing, marking, and consignment instructions.

    (a) The contracting officer shall insert a clause substantially the 
same as the clause at 452.247-71, Marking Deliverables, in solicitations 
and contracts if special marking on deliverables (other than reports) 
are required.
    (b) The contracting officer shall insert the clause at 452.247-72, 
Packing for Domestic Shipment, in contracts when item(s) will be 
delivered for immediate use to a destination in the continental United 
States; when the material specification or purchase description does not 
provide preservation, packaging, packing, and/or marking requirements; 
and/or when the requiring activity has not cited a specific 
specification for packaging.
    (c) The contracting officer shall insert the clause at 452.247-73, 
Packing for Overseas Shipment, in contracts when item(s) will be 
delivered to an overseas destination for immediate use, the material 
specification does not specify packing levels, and the required activity 
has not specified such requirements.

                           PART 448 [RESERVED]

[[Page 149]]



PART 449_TERMINATION OF CONTRACTS--Table of Contents




                    Subpart 449.1_General Principles

Sec.
449.106 Fraud or other criminal conduct.
449.111 Review of proposed settlements.

                  Subpart 449.4_Termination for Default

449.402 Termination of fixed-price contracts for default.
449.402-3 Procedure for default.

               Subpart 449.5_Contract Termination Clauses

449.501 General.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



                    Subpart 449.1_General Principles



449.106  Fraud or other criminal conduct.

    (a) If the contracting officer suspects fraud or other criminal 
conduct a written report documenting the facts shall be submitted by the 
head of the contracting activity (HCA) to the Office of Inspector 
General. Copies of documents or other information connected with the 
suspected fraud or criminal conduct shall be provided with the report. 
Concurrently, a copy of the report shall also be submitted to the Senior 
Procurement Executive.
    (b) Depending on the findings of the Office of Inspector General, 
the HCA may initiate suspension or debarment action as prescribed in FAR 
part 9.4 and part 409.4.



449.111  Review of proposed settlements.

    Proposed settlement agreements shall be reviewed and approved in 
accordance with contracting activity procedures.



                  Subpart 449.4_Termination for Default



449.402  Termination of fixed-price contracts for default.



449.402-3  Procedure for default.

    In addition to the requirements of FAR 49.402-3(g), the notice of 
termination shall contain instructions regarding the disposition of any 
Government property in the possession of the contractor (see FAR 45.508-
1) and, in the case of construction contracts, such materials, 
appliances, and structures as may be on the site of the construction 
work. The notice shall also contain a statement concerning the liability 
of the contractor or its surety for any liquidated damages (see FAR 
49.402-7).



               Subpart 449.5_Contract Termination Clauses



449.501  General.

    Use of special purpose termination clauses pursuant to the authority 
of FAR 49.501 shall be approved in advance by the HCA.



PART 450_EXTRAORDINARY CONTRACTUAL ACTIONS--Table of Contents




Sec.
450.001 Definitions.

Subpart 450.1 [Reserved]

  Subpart 450.2_Delegation of and Limitations on Exercise of Authority

450.201 Delegation of authority.

                   Subpart 450.3_Contract Adjustments

450.303 Contract adjustment.
450.303-1 Contractor requests.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



450.001  Definitions.

    Approving authority, as used in this part, means the Assistant 
Secretary for Administration.
    Secretarial level, as used in this part means the Assistant 
Secretary for Administration.

[[Page 150]]

Subpart 450.1 [Reserved]



  Subpart 450.2_Delegation of and Limitations on Exercise of Authority



450.201  Delegation of authority.

    The Assistant Secretary for Administration is authorized to approve 
all actions under FAR part 50 except indemnification actions listed in 
FAR 50.201(d) which must be approved by the Secretary, without power of 
delegation.



                   Subpart 450.3_Contract Adjustments



450.303  Contract adjustment.



450.303-1  Contractor requests.

    Contractor requests shall be submitted to the contracting officer.

                           PART 451 [RESERVED]

[[Page 151]]



                     SUBCHAPTER H_CLAUSES AND FORMS





PART 452_SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




              Subpart 452.2_Texts of Provisions and Clauses

Sec.
452.204-70 Inquiries.
452.211-70 Brand Name or Equal.
452.211-71 Equal Products Offered.
452.211-72 Statement of Work/Specifications.
452.211-73 Attachments to Statement of Work/Specifications.
452.211-74 Period of Performance.
452.211-75 Effective Period of the Contract.
452.214-70 Award by Lot.
452.215-71 Instructions for the Preparation of Technical and Business 
          Proposals.
452.215-72 Amendments to Proposals.
452.215-73 Post Award Conference.
452.216-70 Award Fee.
452.216-71 Base Fee and Award Fee Proposal.
452.216-72 Evaluation Quantities--Indefinite-Delivery Contract.
452.216-73 Minimum and Maximum Contract Amounts.
452.216-74 Ceiling Price.
452.216-75 Letter Contract.
452.219-70 Size Standard and NAICS Code Information.
452.224-70 Confidentiality of Information.
452.226-70--452.226-72 [Reserved]
452.228-70 Alternative Forms of Security.
452.228-71 Insurance Coverage.
452.232-70 Reimbursement for Bond Premiums--Fixed-Price Construction 
          Contracts.
452.236-70 Additive or Deductive Items.
452.236-71 Prohibition Against the Use of Lead-Based Paint.
452.236-72 Use of Premises.
452.236-73 Archaeological or Historic Sites.
452.236-74 Control of Erosion, Sedimentation, and Pollution.
452.236-75 Maximum Workweek--Construction Schedule.
452.236-76 Samples and Certificates.
452.236-77 Emergency Response.
452.236-78 [Reserved]
452.236-79 Opted Timber Sale Road Requirements.
452.236-80 Firms Ineligible for Award--Construction.
452.237-70 Loss, Damage, Destruction or Repair.
452.237-71 Pre-Bid/Pre-Proposal Conference.
452.237-73 Equipment Inspection Visit.
452.237-74 Key Personnel.
452.237-75 Restrictions Against Disclosure.
452.237-76 Progress Reporting.
452.237-78 Contracts with Consulting Firms for Services.
452.246-70 Inspection and Acceptance.
452.247-70 Delivery Location.
452.247-71 Marking Deliverables.
452.247-72 Packing for Domestic Shipment.
452.247-73 Packing for Overseas Shipment.

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



              Subpart 452.2_Texts of Provisions and Clauses



452.204-70  Inquiries.

    As prescribed in 404.7001, insert the following provision:

                          Inquiries (FEB 1988)

    Inquiries and all correspondence concerning this solicitation should 
be submitted in writing to the Contracting Officer. Offerors should 
contact only the Contracting Officer issuing the solicitation about any 
aspect of this requirement prior to contract award.

                           (End of provision)



452.211-70  Brand Name or Equal.

    As prescribed in 411.171, insert the following provision:

                     Brand Name or Equal (NOV 1996)

    (As used in this provision, the term ``brand name'' includes 
identification of products by make and model.)
    (a) If items called for by this solicitation have been identified by 
a ``brand name or equal'' description, such identification is intended 
to be descriptive, but not restrictive, and is to indicate the quality 
and characteristics of products that will be satisfactory. Offers of 
``equal'' products (including products of the brand name manufacturer 
other than the one described by brand name) will be considered for award 
if such products are clearly identified in the offer (see clause 
452.211-71) and are determined by the Contracting Officer to meet fully 
the salient characteristics requirements listed in the solicitation.
    (b) Unless the offeror clearly indicates in its offer that it is 
offering an ``equal'' product, the offeror shall be considered as 
offering the brand name product(s) referenced in the solicitation.
    (c)(1) If the offeror proposes to furnish an ``equal'' product or 
products, the brand

[[Page 152]]

name(s), if any, and any other required information about the product(s) 
to be furnished shall be inserted in the space provided in the 
solicitation. The evaluation of offers and the determination as to the 
equality of the product(s) offered shall be the responsibility of the 
Government and will be based on information furnished by the offeror or 
identified in its offer as well as other information reasonably 
available to the contracting activity. Caution to offerors: The 
contracting activity is not responsible for locating or securing any 
information which is not identified in the offer and is not reasonably 
available to the contracting activity. Accordingly, to assure that 
sufficient information is available, the offeror must furnish as a part 
of its offer all descriptive material (such as cuts, illustrations, 
drawings, or other information) necessary for the contracting activity 
to (i) determine whether the product offered meets the salient 
characteristics requirement of the solicitation, and (ii) establish 
exactly what the offeror proposes to furnish and what the Government 
would be binding itself to purchase by making an award. The information 
furnished may include specific reference to information previously 
furnished or to information otherwise available to the contracting 
activity.
    (2) If an offeror proposes to modify a product so as to make it 
conform to the requirements of the solicitation, the offer shall include 
(i) a clear description of such proposed modifications and (ii) clearly 
marked descriptive material to show the proposed modifications.

                           (End of provision)

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998, 
as amended at 70 FR 50, Jan. 3, 2005]



452.211-71  Equal Products Offered.

    As prescribed in 411.171, insert the following or substantially the 
same clause in solicitations seeking offers on a ``brand name or equal'' 
basis to allow offerors the opportunity to clearly identify the 
``equal'' item being offered, and to illustrate how that item meets the 
salient characteristics requirements of the Government.

                    Equal Products Offered (NOV 1996)

    (a) Offerors proposing to furnish an ``equal'' product, in 
accordance with the ``Brand Name or Equal'' provision of this 
solicitation, shall provide the following information for each offered 
``equal'' product:
Contract Line Item Number (if any):_____________________________________
Brand Name or Equal Product identified by the Government in this 
solicitation:___________________________________________________________
Offered Product Name:___________________________________________________
Catalog Description or part number:_____________________________________
________________________________________________________________________
Manufacturer's Name:____________________________________________________
Manufacturer's Address:_________________________________________________
________________________________________________________________________
________________________________________________________________________
    (b) Offerors are responsible for submitting all additional 
information on the above product necessary for the Contracting Officer 
to determine whether the product offered meets the ``brand name or 
equal'' product's salient characteristics listed in the solicitation.

                             (End of clause)

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998.]



452.211-72  Statement of Work/Specifications.

    As prescribed in 411.171, insert the following clause:

               Statement of Work/Specifications (FEB 1988)

    The Contractor shall furnish the necessary personnel, material, 
equipment, services and facilities (except as otherwise specified), to 
perform the Statement of Work/Specifications referenced in Section J.

                             (End of clause)

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998.]



452.211-73  Attachments to Statement of Work/Specifications.

    As prescribed in 411.171, insert the following clause:

       Attachments to Statement of Work/Specifications (FEB 1988)

    The attachments to the Statement of Work/Specifications listed in 
Section J are hereby made part of this solicitation and any resultant 
contract.

                             (End of clause)

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998.]



452.211-74  Period of Performance.

    As prescribed in 411.404(a), insert the following clause:

                    Period of Performance (FEB 1988)

    The period of performance of this contract is from ------ through --
----.*

[[Page 153]]

                             (End of clause)

    * Contracting Officer shall insert the appropriate dates.

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998.]



452.211-75  Effective Period of the Contract.

    As prescribed in 411.404(b), insert the following clause:

               Effective Period of the Contract (FEB 1988)

    The effective period of this contract is from ------ through ----
--.*

                             (End of clause)

    * Contracting Officer shall insert the appropriate dates.

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998.]



452.214-70  Award by Lot.

    As prescribed in 414.201-6, insert a provision substantially as 
follows:

                         Award by Lot (NOV 1996)

    Subject to the Section L provision FAR 52.214-10, ``Contract Award--
Sealed Bidding,'' award will generally be made to a single bidder on 
each entire lot. However, the Government reserves the right to award by 
item within any lot when the contracting officer determines that it is 
advantageous to the Government.

                           (End of provision)



452.215-71  Instructions for the Preparation of Technical and Business Proposals.

    As prescribed in 415.209(a), insert a provision substantially as 
follows:

  Instructions for the Preparation of Technical and Business Proposals 
                               (SEP 1999)

    (a) General Instructions. Proposals submitted in response to this 
solicitation shall be furnished in the following format with the numbers 
of copies as specified below.
    (1) The proposal must include a technical proposal and business 
proposal. Each of the parts shall be separate and complete so that 
evaluation of one may be accomplished independently from 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 the contractor's understanding of the 
statement of work may be evaluated.
    (2) Offerors may, at their discretion, submit alternate proposals or 
proposals which deviate from the requirement; provided, that an offeror 
also submit a proposal for performance of the work as specified in the 
statement of work. Any ``alternate'' proposal may be considered if 
overall performance would be improved or not compromised, and if it is 
in the best interest of the Government. Alternate proposals, or 
deviations from any requirement of this RFP, must be clearly identified.
    (3) The Government will evaluate proposals in accordance with the 
evaluation criteria set forth in Section M of this RFP.
    (4) Offerors shall submit their proposal(s) in the following format 
and the quantities specified:
    (a) ------* copies of the completed, signed offer (Sections A 
through K of the solicitation package)
    (b) ------* copies of the technical proposal
    (c) ------* copies of the business/cost proposal
    (b) Technical Proposal Instructions. The technical proposal will be 
used to make an evaluation and arrive at a determination as to whether 
the proposal will meet the requirements of the Government. Therefore, 
the technical proposal must present sufficient information to reflect a 
thorough understanding of the requirements and a detailed, description 
of the techniques, procedures and program for achieving the objectives 
of the specifications/statement of work. Proposals which merely 
paraphrase the requirements of the Government's specifications/ 
statement of work, or use such phrases as ``will comply'' or ``standard 
techniques will be employed'' will be considered unacceptable and will 
not be considered further. As a minimum, the proposal must clearly 
provide the following:
    (Contracting Officer shall identify in this section the minimum 
information required to evaluate each technical evaluation factor listed 
in Section M.)
    (c) Business Proposal Instructions.
    (1) Cost Proposal.
    In addition to any other requirements for cost/pricing information 
required in clause FAR 52.215-20, Requirements for Cost or Pricing Data 
or Information Other Than Cost or Pricing Data (OCT 1997), the following 
is required:
    (Contracting Officer shall identify additional information required 
if appropriate.)
    (2) Business Proposal.
    (a) Furnish financial statements for the last two years, including 
an interim statement for the current year, unless previously provided to 
the office issuing the RFP, in which case a statement as to when and 
where this information was provided may be furnished instead.

[[Page 154]]

    (b) Specify the financial capacity, working capital and other 
resources available to perform the contract without assistance from any 
outside source.
    (c) Provide the name, location, and intercompany pricing policy for 
other divisions, subsidiaries, parent company, or affiliated companies 
that will perform work or furnish materials under this contract.

                           (End of provision)

    *Contracting officer shall insert number of copies required.

[61 FR 53646, Oct. 15, 1996, as amended at 64 FR 52675, Sept. 30, 1999; 
70 FR 50, Jan. 3, 2005]



452.215-72  Amendments to Proposals.

    As prescribed in 415.209(b), insert the following provision:

                   Amendments to Proposals (FEB 1988)

    Any changes to a proposal made by the offeror after its initial 
submittal shall be accomplished by replacement pages. Changes from the 
original page shall be indicated on the outside margin by vertical lines 
adjacent to the change. The offeror shall include the date of the 
amendment on the lower right corner of the changed pages.

                           (End of provision)

[61 FR 53646, Oct. 15, 1996, as amended at 64 FR 52675, Sept. 30, 1999]



452.215-73  Post Award Conference.

    As prescribed in 415.570, insert a clause substantially as follows:

                    Post Award Conference (NOV 1996)

    A post award conference with the successful offeror is required. It 
will be scheduled within ------* days after the date of contract award. 
The conference will be held at: ------*.

                             (End of clause)

    * Contracting officer to insert number of days and location.

[61 FR 53646, Oct. 15, 1996, as amended at 64 FR 52675, Sept. 30, 1999]



452.216-70  Award Fee.

    As prescribed in 416.405, insert a clause substantially as follows:

                          Award Fee (FEB 1988)

    The amount of award fee the Contractor earns, if any, is based on a 
subjective evaluation by the Government of the quality of the 
Contractor's performance in accordance with the award fee plan. The 
Government will determine the amount of award fee every ------* months 
beginning with ------*. The Fee Determination Official (FDO) will 
unilaterally determine the amount of award fee. The FDO's determination 
will be in writing to the Contractor and is not subject to the 
``Disputes'' clause. The Government may unilaterally change the award 
fee plan at any time and will provide such changes in writing to the 
Contractor prior to the beginning of the applicable evaluation period. 
The Contractor may submit a voucher for the earned award fee. Available 
award fee not earned during one period does not carry over to subsequent 
periods.

                             (End of clause)

    * Contracting Officer shall insert appropriate number of months.
    ** Contracting Officer shall insert appropriate date.



452.216-71  Base Fee and Award Fee Proposal.

    As prescribed in 416.470, insert the following provision:

                 Base Fee and Award Proposal (FEB 1988)

    For the purpose of this solicitation, offerors shall propose a base 
fee of ------* percent of the total estimated cost proposed. The award 
fee shall not exceed ------* percent of the total estimated cost.

                           (End of provision)

    * Contracting Officer shall insert appropriate percentages.



452.216-72  Evaluation Quantities--Indefinite-Delivery Contract.

    As prescribed in 416.506(a), insert a provision substantially as 
follows:

     Evaluation Quantities--Indefinite-Delivery Contract (FEB 1988)

    To evaluate offers for award purposes, the Government will apply the 
offeror's proposed fixed-prices/rates to the estimated quantities 
included in the solicitation, and will add other direct costs if 
applicable.

                           (End of provision)



452.216-73  Minimum and Maximum Contract Amounts.

    As prescribed in 416.506(b), insert the following clause:

[[Page 155]]

             Minimum and Maximum Contract Amounts (FEB 1988)

    During the period specified in FAR clause 52.216-18, ORDERING, the 
Government shall place orders totaling a minimum of ------*, but not in 
excess of ------*.

                             (End of clause)

    * Contracting Officer shall insert appropriate quantity or dollar 
amounts.



452.216-74  Ceiling Price.

    As prescribed in 416.670, insert the following clause:

                        Ceiling Price (FEB 1988)

    The ceiling price of this contract is $------*. The Contractor shall 
not make expenditures or incur obligations in the performance of this 
contract which exceed the ceiling price specified herein, except at the 
Contractor's own risk.

                             (End of clause)

    *Contracting Officer shall insert appropriate dollar amount.



452.216-75  Letter Contract.

    As prescribed in 416.603-4, insert the following clause:

                       Letter Contract (FEB 1988)

    This contract replaces letter contract No. ------* dated ------* and 
all amendments thereto.

                             (End of clause)

    * Contracting Officer shall insert number and date.



452.219-70  Size Standard and NAICS Code Information.

    As prescribed in 419.508, insert the following provision:

           Size Standard and NAICS Code Information (SEP 2001)

    The North American Industrial Classification System Code(s) and 
business size standard(s) describing the products and/or services to be 
acquired under this solicitation are listed below:

Contract line item(s): ------* NAICS Code ------* Size Standard ------*

                           (End of provision)

    * Contracting Officer shall insert the appropriate data for each 
contract line item in the solicitation. The data entry line may be 
duplicated as required to describe all of the contract line items or 
sub-items.

[61 FR 53646, Oct. 15, 1996, as amended at 66 FR 49317, Sept. 27, 2001]



452.224-70  Confidentiality of Information.

    As prescribed in 424.104, insert a clause substantially as follows:

                Confidentiality of Information (FEB 1988)

    (a) Confidential information, as used in this clause, means--
    (1) information or data of a personal nature, proprietary about an 
individual, or (2) information or data submitted by or pertaining to an 
organization.
    (b) In addition to the types of confidential information described 
in (a)(1) and (2) above, information which might require special 
consideration with regard to the timing of its disclosure may derive 
from studies or research, during which public disclosure of primarily 
invalidated findings could create an erroneous conclusion which might 
threaten public health or safety if acted upon.
    (c) The Contracting Officer and the Contractor may, by mutual 
consent, identify elsewhere in this contract specific information and/or 
categories of information which the Government will furnish to the 
Contractor or that the Contractor is expected to generate which is 
confidential. Similarly, the Contracting Officer and the Contractor may, 
by mutual consent, identify such confidential information from time to 
time during the performance of the contract. Failure to agree will be 
settled pursuant to the ``Disputes'' clause.
    (d) If it is established that information to be utilized under this 
contract is subject to the Privacy Act, the Contractor will follow the 
rules and procedures of disclosure set forth in the Privacy Act of 1974, 
5 U.S.C. 552a, and implementing regulations and policies, with respect 
to systems of records determined to be subject to the Privacy Act.
    (e) Confidential information, as defined in (a)(1) and (2) above, 
shall not be disclosed without the prior written consent of the 
individual, institution or organization.
    (f) Written advance notice of at least 45 days will be provided to 
the Contracting Officer of the Contractor's intent to release findings 
of studies or research, which have the possibility of adverse effects on 
the public or the Federal agency, as described in (b) above. If the 
Contracting Officer does not pose any objections in writing within the 
45 day period, the Contractor may proceed with disclosure. Disagreements 
not resolved by the Contractor and Contracting Officer will be settled 
pursuant to the ``Disputes'' clause.

[[Page 156]]

    (g) Whenever the Contractor is uncertain with regard to the proper 
handling of material under the contract, or if the material in question 
is subject to the Privacy Act or is confidential information subject to 
the provisions of this clause, the Contractor shall obtain a written 
determination from the Contracting Officer prior to any release, 
disclosure, dissemination, or publication.
    (h) The provisions of paragraph (e) of this clause shall not apply 
when the information is subject to conflicting or overlapping provisions 
in other Federal, State or local laws.

                             (End of clause)



452.226-70--452.226-72  [Reserved]



452.228-70  Alternative Forms of Security.

    As prescribed in 428.204-2, insert the following provision:

                Alternative Forms of Security (NOV 1996)

    If furnished as security, money orders, drafts, cashiers checks, or 
certified checks shall be drawn payable to: ------*.

                           (End of provision)

    * Contracting Officer shall insert the name of the USDA contracting 
activity.



452.228-71  Insurance Coverage.

    As prescribed in 428.310, insert the following clause:

                      Insurance Coverage (NOV 1996)

    Pursuant to FAR clause 52.228-5, Insurance-Work on a Government 
Installation, the Contractor will be required to present evidence to 
show, as a minimum, the amounts of insurance coverage indicated below:
    (a) Workers Compensation and Employer's Liability. The Contractor is 
required to comply with applicable Federal and State workers' 
compensation and occupational disease statutes. If occupational diseases 
are not compensable under those statutes, they shall be covered under 
the employer's liability section of the insurance policy, except when 
contract operations are so commingled with a Contractor's commercial 
operations that it would not be practical to require this coverage. 
Employer's liability coverage of at least $100,000 shall be required, 
except in States with exclusive or monopolistic funds that do not permit 
worker's compensation to be written by private carriers.
    (b) General Liability. The Contractor shall have bodily injury 
liability insurance coverage written on a comprehensive form of policy 
of at least $500,000 per occurrence.
    (c) Automobile Liability. The Contractor shall have automobile 
liability insurance written on a comprehensive form of policy. The 
policy shall provide for bodily injury and property damage liability 
covering the operation of all automobiles used in connection with 
performing the contract. Policies covering automobiles operated in the 
United States shall provide coverage of at least $200,000 per person and 
$500,000 per occurrence for bodily injury and $20,000 per occurrence for 
property damage or loss.
    (d) Aircraft Public and Passenger Liability. When aircraft are used 
in connection with performing the contract, the Contractor shall have 
aircraft public and passenger liability insurance. Coverage shall be at 
least $200,000 per person and $500,000 per occurrence for bodily injury, 
other than passenger injury. Coverage for passenger injury shall be at 
least $200,000 multiplied by the number of seats or passengers, 
whichever is greater.

                             (End of clause)

    Alternate I (NOV 1996). As prescribed in 428.310, substitute the 
following paragraph (b), when additionally the contractor must have 
property damage liability coverage:

    (b) General Liability. (1) The Contractor shall have bodily injury 
liability coverage written on a comprehensive form of policy of at least 
$500,000 per occurrence.
    (2) The Contractor shall have property damage liability insurance 
shall be required in the amount of ------* per occurrence.
    * Contracting Officer shall insert amount required.



452.232-70  Reimbursement for Bond Premiums--Fixed-Price Construction Contracts.

    As prescribed in 432.111, insert the following clause:

Reimbursement for Bond Premiums--Fixed-Price Construction Contracts (NOV 
                                  1996)

    The Contract Price includes the total amount for premiums that the 
Contractor attributes to the furnishing of performance and payment bonds 
required by the contract. Reimbursement for bond premiums under the 
clause at FAR 52.232-5, Payments Under Fixed-Price Construction, shall 
not cover any amount therefor not included in the contract price.

                             (End of clause)

[61 FR 53646, Oct. 15, 1996. Redesignated at 63 FR 26996, May 15, 1998, 
as amended at 70 FR 50, Jan. 3, 2005]

[[Page 157]]



452.236-70  Additive or Deductive Items.

    As prescribed in 436.205, insert the following provision:

                 Additive or Deductive Items (FEB 1988)

    The low bidder for purposes of award shall be the conforming 
responsible bidder offering the low aggregate amount for the first or 
base bid item, plus or minus (in the order of priority listed in the 
schedule) those additive or deductive bid items providing the most 
features of the work within the funds determined by the government to be 
available before bids are opened. If addition of another bid item in the 
listed order of priority would make the award exceed such funds for all 
bidders, it shall be skipped and the next subsequent additive bid item 
in a lower amount shall be added if award therein can be made within 
such funds. For example, when the amount available is $100,000 and a 
bidder's base bid and four successive additives are $85,000, $10,000, 
$8,000, $6,000, and $4,000, the aggregate amount of the bid for purposes 
of award would be $99,000 for the base bid plus the first and fourth 
additives, the second and third additives being skipped because of each 
of them would cause the aggregate bid to exceed $100,000. In any case 
all bids shall be evaluated on the basis of the same additive or 
deductive bid items, determined as above provided. The listed order of 
priority need be followed only for determining the low bidder. After 
determination of the low bidder as stated, award in the best interests 
of the Government may be made on the selected first or base bid item and 
any combination of additive or deductive items for which funds are 
determined to be available at the time of the award, provided that award 
on such combination of bid items does not exceed the amount offered by 
any other conforming responsible bidder for the same combination of bid 
items.

                             (End of clause)



452.236-71  Prohibition Against the Use of Lead-Based Paint.

    As prescribed in 436.571, insert the following clause:

       Prohibition Against the Use of Lead-Based Paint (NOV 1996)

    Neither the Contractor nor any subcontractor performing under this 
contract shall use paints containing more then 0.06 of 1 percent lead by 
weight (calculated as lead metal) in the total nonvolatile content of 
the paint, or the equivalent measure of lead in the dried film of paint 
already applied, or both.

                             (End of clause)



452.236-72  Use of Premises.

    As prescribed in 436.572, insert the following clause:

                       Use of Premises (NOV 1996)

    (a) Before any camp, quarry, borrow pit, storage, detour, or bypass 
site, other than shown on the drawings, is opened or operated on USDA 
land or lands administered by the USDA, the Contractor shall obtain 
written permission from the Contracting Officer. A camp is interpreted 
to include a campsite or trailer parking area of any employee working on 
the project for the Contractor.
    (b) Unless excepted elsewhere in the contract, the Contractor shall 
(i) provide and maintain sanitation facilities for the work force at the 
site and (ii) dispose of solid waste in accordance with applicable 
Federal, State and local regulations.

                             (End of clause)



452.236-73  Archaeological or Historic Sites.

    As prescribed in 436.573, insert the following clause:

               Archaeological or Historic Sites (FEB 1988)

    If a previously unidentified archaeological or historic site(s) is 
encountered, the Contractor shall discontinue work in the general area 
of the site(s) and notify the Contracting Officer immediately.

                             (End of clause)



452.236-74  Control of Erosion, Sedimentation, and Pollution.

    As prescribed in 436.574, insert the following clause:

       Control of Erosion, Sedimentation, and Pollution (NOV 1996)

    (a) Operations shall be scheduled and conducted to minimize erosion 
of soils and to prevent silting and muddying of streams, rivers, 
irrigation systems, and impoundments (lakes, reservoirs, etc.).
    (b) Pollutants such as fuels, lubricants, bitumens, raw sewage, and 
other harmful materials shall not be discharged on the ground; into or 
nearby rivers, streams, or impoundments; or into natural or man-made 
channels. Wash water or waste from concrete or aggregate operations 
shall not be allowed to enter live streams prior to treatment by 
filtration, settling, or other means sufficient to reduce the sediment 
content to not more than that of the stream into which it is discharged.

[[Page 158]]

    (c) Mechanized equipment shall not be operated in flowing streams 
without written approval by the Contracting Officer.

                             (End of clause)



452.236-75  Maximum Workweek--Construction Schedule.

    As prescribed in 436.575, insert the following clause:

           Maximum Workweek--Construction Schedule (NOV 1996)

    Within ---- calendar days after receipt of a written request from 
the Contracting Officer, the Contractor must submit the following in 
writing for approval:
    (a) A schedule as required by FAR clause 52.236-15, Schedules for 
Construction Contracts, and
    (b) The hours (including the daily starting and stopping times) and 
days of the week the Contractor proposes to carry out the work.
    The maximum workweek that will be approved is ----*.

                             (End of clause)

    * Contracting Officer shall insert appropriate number of days and 
hours and/or days.



452.236-76  Samples and Certificates.

    As prescribed in 436.576, insert the following clause:

                   Samples and Certificates (FEB 1988)

    When required by the specifications or the Contracting Officer, 
samples, certificates, and test data shall be submitted after award of 
the contract, prepaid, in time for proper action by the Contracting 
Officer or his/her designated representative. Certificates and test data 
shall be submitted in triplicate to show compliance with materials and 
construction specified in the contract performance requirements.
    Samples shall be submitted in duplicate by the Contractor, except as 
otherwise specified, to show compliance with the contract requirements. 
Materials or equipment for which samples, certifications or test data 
are required shall not be used in the work until approved in writing by 
the Contracting Officer.

                             (End of clause)



452.236-77  Emergency Response.

    As prescribed in 436.577, the following clause may be used in Forest 
Service construction contracts:

                      Emergency Response (NOV 1996)

    (a) Contractor's Responsibility for Fire Fighting. (1) The 
Contractor, under the provisions of FAR clause 52.236-9, Protection of 
Existing Vegetation, Structures, Equipment, Utilities, and Improvements, 
shall immediately extinguish all fires on the work site other than those 
fires in use as a part of the work.
    (2) The Contractor may be held liable for all damages and for all 
costs incurred by the Government for labor, subsistence, equipment, 
supplies, and transportation deemed necessary to control or suppress a 
fire set or caused by the Contractor or the Contractor's agents or 
employees.
    (b) Contractor's Responsibility for Notification in Case of Fire. 
The Contractor shall immediately notify the Government of any fires 
sighted on or in the vicinity of the work site.
    (c) Contractor's Responsibility for Responding to Emergencies. When 
directed by the Contracting Officer, the Contractor shall allow the 
Government to temporarily use employees and equipment from the work site 
for emergency work (anticipated to be restricted to fire fighting). An 
equitable adjustment for the temporary use of employees and equipment 
will be made under the Changes clause, FAR 52.243-4.

                             (End of clause)



452.236-78  [Reserved]



452.236-79  Opted Timber Sale Road Requirements.

    As prescribed in 436.579, insert the following clause:

             Opted Timber Sale Road Requirements (NOV 1996)

    This contract is for the construction of timber sale road(s) which a 
timber purchaser has opted to have the Government construct. The 
Government is obligated to make these roads available to the timber 
purchaser by ------*. Failure to make these roads available by this date 
could result in Government liability for delay to the timber purchaser 
for which the Contractor might become liable should the Contractor fail 
to complete this contract within the specified and allowed contract 
time.

                             (End of clause)

    * Contracting Officer shall insert appropriate date.



452.236-80  Firms Ineligible for Award--Construction.

    As prescribed in 436.670, insert the following clause:

[[Page 159]]

           Firms Ineligible for Award--Construction (NOV 1996)

    The firm(s) and its subsidiaries or affiliates signatory to this 
contract shall be ineligible for award of any construction contract 
resulting from the design work performed under this contract.

                             (End of clause)



452.237-70  Loss, Damage, Destruction or Repair.

    (a) As prescribed in 437.110(a), insert a clause substantially as 
follows:

             Loss, Damage, Destruction or Repair (FEB 1988)

    (a) For equipment furnished under this contract without operator, 
the Government will assume liability for any loss, damage or destruction 
of such equipment, not to exceed a total of $------* except that no 
reimbursement will be made for loss, damage or destruction due to (1) 
ordinary wear or tear, (2) mechanical failure, or (3) the fault or 
negligence of the Contractor or the Contractor's agents or employees.
    (b) For equipment furnished under this contract with operator, the 
Government shall not be liable for any loss, damage or destruction of 
such equipment, except for loss, damage or destruction resulting from 
the negligent or wrongful act(s) of Government employee(s) while acting 
within the scope of their employment.
    (c) All repairs to equipment furnished under this contract shall be 
made by the Contractor and reimbursement, if any, shall be determined in 
accordance with (a) or (b) above. Repairs shall be made promptly and 
equipment returned to use within ------** hours. In lieu of repairing 
equipment, the Contractor may furnish similar replacement equipment 
within the time specified. The Contractor may authorize the Government 
to make repairs upon the request of the Contracting Officer. In such 
case, the Contractor will be billed for labor and parts costs.

                             (End of clause)

    * Contracting Officer shall insert amount available in current funds 
to cover potential liability.
    ** Contracting Officer shall insert appropriate number of hours.



452.237-71  Pre-Bid/Pre-Proposal Conference.

    As prescribed in 437.110(b), insert a provision substantially as 
follows:

               Pre-Bid/Pre-Proposal Conference (FEB 1988)

    (a) The Government is planning a pre-bid/pre-proposal conference, 
during which potential offerors may obtain a better understanding of the 
work required.
    (b) Offerors are encouraged to submit all questions in writing at 
least five (5) days prior to the conference. Questions will be 
considered at any time prior to or during the conference; however, 
offerors will be asked to confirm verbal questions in writing. 
Subsequent to the conference, an amendment to the solicitation 
containing an abstract of the questions and answers, and a list of 
attendees, will be disseminated.
    (c) In order to facilitate conference preparations, it is requested 
that the person named on the Standard Form 33 of this solicitation be 
contacted and advised of the number of persons who will attend.
    (d) The Government assumes no responsibility for any expense 
incurred by an offeror prior to contract award.
    (e) Offerors are cautioned that, notwithstanding any remarks or 
clarifications given at the conference, all terms and conditions of the 
solicitation remain unchanged unless they are changed by amendment to 
the solicitation. If the answers to conference questions, or any 
solicitation amendment, create ambiguities, it is the responsibility of 
the offeror to seek clarification prior to submitting an offer.
    (f) The conference will be held:

Date:___________________________________________________________________
Time:___________________________________________________________________
Location:_______________________________________________________________

                             (End of clause)



452.237-73  Equipment Inspection Visit.

    As prescribed in 437.110(c), insert the following provision:

                  Equipment Inspection Visit (FEB 1988)

    Offerors are urged and expected to inspect the equipment on which 
maintenance or repairs are to be performed and to satisfy themselves 
regarding all conditions that may affect the cost of contract 
performance, to the extent that the information is reasonably 
obtainable. In no event shall failure to inspect the equipment 
constitute grounds for a claim after contract award.
    Offerors are invited to inspect the ------* at ------* by 
telephoning ------* on ------* for an appointment.

                             (End of clause)

    * Contracting Officer shall insert appropriate data.

[[Page 160]]



452.237-74  Key Personnel.

    As prescribed in 437.110(d), insert a clause substantially as 
follows:

                        Key Personnel (FEB 1988)

    (a) The Contractor shall assign to this contract the following key 
personnel: ----------
    (b) During the first ninety (90) days of performance, the Contractor 
shall make no substitutions of key personnel unless the substitution is 
necessitated by illness, death, or termination of employment. The 
Contractor shall notify the Contracting Officer within 15 calendar days 
after the occurrence of any of these events and provide the information 
required by paragraph (c) below. After the initial 90-day period, the 
Contractor shall submit the information required by paragraph (c) to the 
Contracting Officer at least 15 days prior to making any permanent 
substitutions.
    (c) The Contractor shall provide a detailed explanation of the 
circumstances necessitating the proposed substitutions, complete resumes 
for the proposed substitutes, and any additional information requested 
by the Contracting Officer. Proposed substitutes should have comparable 
qualifications to those of the persons being replaced. The Contracting 
Officer will notify the Contractor within 15 calendar days after receipt 
of all required information of the decision on substitutions. The 
contract will be modified to reflect any approved changes of key 
personnel.

                             (End of clause)



452.237-75  Restrictions Against Disclosure.

    As prescribed in 437.110(e), insert a clause substantially as 
follows:

               Restrictions Against Disclosure (FEB 1988)

    (a) The Contractor agrees, in the performance of this contract, to 
keep all information contained in source documents or other media 
furnished by the Government in the strictest confidence. The Contractor 
also agrees not to publish or otherwise divulge such information in 
whole or in part in any manner or form, or to authorize or permit others 
to do so, taking such reasonable measures as are necessary to restrict 
access to such information while in the Contractor's possession, to 
those employees needing such information to perform the work provided 
herein, i.e., on a ``need to know'' basis. The Contractor agrees to 
immediately notify in writing, the Contracting Officer, named herein, in 
the event that the Contractor determines or has reason to suspect a 
breach of this requirement.
    (b) The Contractor agrees not to disclose any information concerning 
the work under this contract to any persons or individual unless prior 
written approval is obtained from the Contracting Officer. The 
Contractor agrees to insert the substance of this clause in any 
consultant agreement or subcontract hereunder.

                             (End of clause)



452.237-76  Progress Reporting.

    As prescribed in 437.270(a), insert a clause substantially as 
follows:

                      Progress Reporting (FEB 1988)

    The Contractor shall submit a progress report ------*, covering work 
accomplished during that period of the contract performance. The 
progress report shall be brief and factual and shall be prepared in 
accordance with the following format:
    (a) A cover page containing:
    (1) Contract number and title;
    (2) Type of report, sequence number of report, and period of 
performance being reported;
    (3) Contractor's name and address;
    (4) Author(s); and
    (5) Date of report.
    (b) Section I--An introduction covering the purpose and scope of the 
contract effort. This shall be limited to one paragraph in all but the 
first and final month's narrative.
    (c) Section II--A description of overall progress plus a separate 
description of each task or other logical segment of work on which 
effort was expended during the report period. The description shall 
include pertinent data and/or graphs in sufficient detail to explain any 
significant results achieved.
    (d) Section III--A description of current technical or substantive 
performance, and any problem(s) which may impede performance along with 
proposed corrective action.
    (e) Section IV--A planning schedule shall be included with the first 
progress report for all assigned tasks required under the contract, 
along with the estimated starting and completion dates for each task. 
The planning schedule shall be updated and submitted with each 
subsequent technical progress report, including an explanation of any 
difference between actual progress and planned progress, why the 
differences have occurred, and--if behind planned progress--what 
corrective steps are planned.
    (f) Section V--If applicable, financial information shall be 
submitted for each major task or line item cost.
    Data shall include:
    (1) The total estimated cost budgeted (fee excluded).
    (2) The estimated cost expended during the current reporting period.

[[Page 161]]

    (3) Identification of direct labor hours of prime contractor and 
subcontractor(s) and/or consultant(s), if applicable.
    (4) Total project to-date expenditures.
    (5) Total remaining funds.

                             (End of clause)

    * Contracting Officer shall insert frequency of reporting 
requirement.



452.237-78  Contracts with Consulting Firms for Services.

    As prescribed in 437.270(b), insert a clause substantially as 
follows:

         Contracts with Consulting Firms for Services (FEB 1988)

    Offerors are specifically cautioned that any firm(s) receiving a 
contract award to provide the services described herein will be 
prohibited from competing for or receiving a follow-on contract to 
perform ------.*

                             (End of clause)

    * Contracting Officer shall insert the appropriate information.



452.246-70  Inspection and Acceptance.

    As prescribed in 446.370, insert the following clause:

                  Inspection and Acceptance (FEB 1988)

    (a) The Contracting Officer or the Contracting Officer's duly 
authorized representative will inspect and accept the supplies and/or 
services to be provided under this contract.
    (b) Inspection and acceptance will be performed at: ------.*

                             (End of clause)

    * Contracting Officer shall insert appropriate identifying data.
    Alternate I (FEB 1988). As prescribed in 446.370, substitute a 
paragraph (b) and add a paragraph (c):

    (b) Inspection will be performed at: ------.*
    (c) Acceptance will be performed at: ------.*

                             (End of clause)



452.247-70  Delivery Location.

    As prescribed in 447.302, insert a clause substantially as follows:

                      Delivery Location (FEB 1988)

    Shipment of deliverable items, other than reports, shall be to: ----
--.*

                             (End of clause)

    * Contracting Officer shall insert appropriate identifying data.



452.247-71  Marking Deliverables.

    As prescribed in 447.305-10(a), insert a clause substantially as 
follows:

                     Marking Deliverables (FEB 1988)

    (a) The contract number shall be placed on or adjacent to all 
exterior mailing or shipping labels of deliverable items called for by 
the contract.
    (b) Mark deliverables, except reports, for: ------.*

                             (End of clause)

    * Contracting Officer shall insert the appropriate information.



452.247-72  Packing for Domestic Shipment.

    As prescribed in 447.305-10(b), insert the following clause:

                Packing for Domestic Shipment (FEB 1988)

    Material shall be packed for shipment in such a manner that will 
insure acceptance by common carriers and safe delivery at destination. 
Containers and closures shall comply with the Interstate Commerce 
Commission regulations, Uniform Freight Classification Rules, or 
regulations of other carriers as applicable to the mode of 
transportation.

                             (End of clause)



452.247-73  Packing for Overseas Shipment.

    As prescribed in 447.305-10(c), insert the following clause:

                Packing for Overseas Shipment (FEB 1988)

    Supplies shall be packed for overseas shipment in accordance with 
the best commercial export practice suitable for water movement to 
arrive undamaged at ultimate destination.

                             (End of clause)



PART 453_FORMS--Table of Contents




Sec.
453.000 Scope of part.

                          Subpart 453.1_General

453.103 Exceptions.
453.108 Recommendations concerning forms.

[[Page 162]]

                   Subpart 453.2_Prescription of Forms

453.200 Scope of subpart.
453.213 Simplified Acquisition and other simplified purchase procedures 
          (AD-838).
453.270 Request for contract action (AD-700).

                  Subpart 453.3_Illustrations of Forms

453.300 Scope of subpart.
453.303 Agency forms.
453.303-700 Procurement Request (AD-700).
453.303-838 Purchase Order (AD-838).

    Authority: 5 U.S.C. 301 and 40 U.S.C. 486(c).

    Source: 61 FR 53646, Oct. 15, 1996, unless otherwise noted.



453.000  Scope of part.

    This part:
    (a) Prescribes USDA (AD) forms for use in acquisition,
    (b) Contains requirements and information generally applicable to AD 
forms and forms prescribed by FAR part 53, and
    (c) Illustrates AD forms.



                          Subpart 453.1_General



453.103  Exceptions.

    (a) The contracting officer shall submit a request for exceptions to 
forms prescribed in FAR part 53 through the head of the contracting 
activity (HCA) to the Senior Procurement Executive (SPE) for referral to 
the GSA.
    (b) Requests for exceptions to AD forms prescribed in part 453 shall 
be handled as individual or class deviations, as appropriate (see 
subpart 401.4).



453.108  Recommendations concerning forms.

    Contracting officers shall submit recommendations for new forms or 
to revise, eliminate, or consolidate forms prescribed by FAR part 53 and 
part 453 through the HCA to the SPE.



                   Subpart 453.2_Prescription of Forms



453.200  Scope of subpart.

    This subpart prescribes USDA (AD) forms for use in acquisition. 
Consistent with the approach used in FAR subpart 53.2, this subpart is 
arranged by subject matter, in the same order as, and keyed to, the 
parts of the AGAR in which the form usage requirements are addressed.



453.213  Simplified Acquisition and other simplified purchase procedures (AD-838).

    Form AD-838, Purchase Order, is prescribed for use as a Simplified 
Acquisition Procedure/delivery order/task order document in lieu of OF 
347 and OF 348, except that use of the OF 347 and OF 348 is authorized 
when utilizing the USDA Integrated Acquisition System (See 413.307).

[70 FR 50, Jan. 3, 2005]



453.270  Request for contract action (AD-700).

    Form AD-700, Procurement Request, may be used as a contract 
requisition document by contracting activities in USDA.



                  Subpart 453.3_Illustrations of Forms



453.300  Scope of subpart.

    This subpart contains illustrations of USDA (AD) forms for use in 
acquisitions. Forms are not illustrated in the Federal Register or Code 
of Federal Regulations. Individual copies may be obtained from any USDA 
contracting activity or the office of the SPE.



453.303  Agency forms.



453.303-700  Procurement Request (AD-700).



453.303-838  Purchase Order (AD-838).

[[Page 163]]



               CHAPTER 5--GENERAL SERVICES ADMINISTRATION




                           (Parts 500 to 599)

  --------------------------------------------------------------------

                          SUBCHAPTER A--GENERAL
Part                                                                Page
501             General Services Administration Acquisition 
                    Regulation System.......................         165
502             Definitions of words and terms..............         167
503             Improper business practices and personal 
                    conflicts of interest...................         168
504             Administrative matters......................         170
           SUBCHAPTER B--COMPETITION AND ACQUISITION PLANNING
505             Publicizing contract actions................         173
509             Contractor qualifications...................         174
511             Describing agency needs.....................         178
512             Acquisition of commercial items.............         182
          SUBCHAPTER C--CONTRACTING METHODS AND CONTRACT TYPES
513             Simplified acquisition procedures...........         183
514             Sealed bidding..............................         183
515             Contracting by negotiation..................         189
516             Types of contracts..........................         195
517             Special contracting methods.................         197
                  SUBCHAPTER D--SOCIOECONOMIC PROGRAMS
519             Small business programs.....................         199
522             Application of labor laws to Government 
                    acquisitions............................         200
523             Environment, conservation, occupational 
                    safety and drug-free workplace..........         201
525             Foreign acquisition.........................         202
             SUBCHAPTER E--GENERAL CONTRACTING REQUIREMENTS
527             Patents, data, and copyrights...............         204

[[Page 164]]

528             Bonds and insurance.........................         204
529             Taxes.......................................         204
532             Contract financing..........................         205
533             Protests, disputes, and appeals.............         209
             SUBCHAPTER F--SPECIAL CATEGORIES OF CONTRACTING
536             Construction and architect-engineer 
                    contracts...............................         210
537             Service contracting.........................         214
538             Federal supply schedule contracting.........         215
                    SUBCHAPTER G--CONTRACT MANAGEMENT
542             Contract administration and audit services..         221
543             Contract modifications......................         221
546             Quality assurance...........................         222
547             Transportation..............................         223
549             Termination of contracts....................         224
                     SUBCHAPTER H--CLAUSES AND FORMS
552             Solicitation provisions and contract clauses         225
553             Forms.......................................         295
               SUBCHAPTER I--SPECIAL CONTRACTING PROGRAMS
570             Acquiring leasehold interests in real 
                    property................................         296

[[Page 165]]



                          SUBCHAPTER A_GENERAL





PART 501_GENERAL SERVICES ADMINISTRATION ACQUISITION REGULATION SYSTEM--Table of Contents




               Subpart 501.1_Purpose, Authority, Issuance

Sec.
501.101 Purpose.
501.103 Authority.
501.104 Applicability.
501.105 Issuance.
501.105-1 Publication and code arrangement.
501.105-2 Arrangement of regulations.
501.105-3 Copies.
501.106 OMB approval under the Paperwork Reduction Act.

             Subpart 501.4_Deviations From the FAR and GSAR

501.402 Policy.
501.403 Individual deviations.
501.404 Class deviations.
501.404-70 Contract action.
501.404-71 Deviations to the nonregulatory GSAM.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37203, July 9, 1999, unless otherwise noted.



               Subpart 501.1_Purpose, Authority, Issuance



501.101  Purpose.

    (a) The General Services Acquisition Regulation (GSAR) contains 
agency acquisition policies and practices, contract clauses, 
solicitation provisions, and forms that control the relationship between 
GSA and contractors and prospective contractors.
    (b) GSAR address rules directly to you, the contracting officer, 
unless otherwise indicated.



501.103  Authority.

    GSA's Senior Procurement Executive issues the GSAR under the 
authority of the Federal Property and Administrative Services Act of 
1949, as amended.



501.104  Applicability.

    (a) General. The GSAR applies to contracts for suppliers or 
services, including construction.
    (b) Acquisition of leasehold interests in real property. Part 570 
establishes rules for the acquisition of leasehold interests in real 
property. Other provisions of 48 CFR chapter 5 (GSAR) do not apply to 
leases of real property unless specifically cross-reference in part 570.
    (c) Relationship to state. Some GSAR rules implement and interpret 
laws and other authorities affecting procurement. A GSAR rule 
specifically directed by statute has the force and effect of law.
    (d) GSAR/FAR Relationship. The GSAR may deviate from the Federal 
Acquisition Regulation (FAR) if authorized. If the GSAR does not 
implement the FAR, the FAR alone governs.



501.105  Issuance.



501.105-1  Publication and code arrangement.

    The GSAR is published in the following sources:
    (a) Daily issue of the Federal Register.
    (b) Annual Code of Federal Regulations (CFR), as Chapter 5 of Title 
48.
    (c) GSA Acquisition Manual distributed within GSA.
    (d) GSA Home Page at http://www/gas.gov. Click on either 
``Government Agencies'' or on ``Business and Industry,'' the click on 
``Acquisition.''



501.105-2  Arrangement of regulations.

    (a) The GSAR numbers and captions policies and procedures to 
correspond to how they appear in the FAR, e.g., 1.104 in the FAR is 
501.104 in the GSAR.
    (b) GSAR rules not implementing the FAR have numbers beginning with 
70, e.g., part 570, subsection 515.209-70.
    (c) The GSAR may have gaps in its numbering scheme because a FAR 
rule may not require GSAR implementation.



501.105-3  Copies.

    The GSAR in CFR form may be purchased from: Superintendent of 
Documents, Government Printing Office, Washington, DC 20402.

[[Page 166]]



501.106  OMB approval under the Paperwork Reduction Act.

------------------------------------------------------------------------
               GSAR Reference                      OMB Control No.
------------------------------------------------------------------------
509.105-1(a)...............................  3090-0007
511.140-70.................................  3090-0203
511.204(d).................................  3090-0246
511.404(a)(1)..............................  3090-0204
511.404(a)(2)..............................  3090-0204
511.404(a)(5)..............................  3090-0204
514.201-7(a)...............................  3090-0200
516.203-4(a)(1)............................  3090-0243
516.506....................................  3090-0248
519.708(b).................................  3090-0252
522.406-6..................................  1215-0149
523.370....................................  3090-0205
532.111(c).................................  3090-0080
532.905-70.................................  9000-0102
532.905-71.................................  3090-0080
537.110(a).................................  3090-0197
537.110(b).................................  3090-0006
538.273(a)(1)..............................  3090-0250
538.273(a)(3)..............................  3090-0262
538.273(b)(1)..............................  3090-0121
542.1107...................................  3090-0027
546.307-70.................................  3090-0027
546.302-71.................................  3090-0027
549.502(b).................................  3090-0027
552.211-8..................................  3090-0204
552.211-77.................................  3090-0246
552.211-78.................................  3090-0204
552.211-82.................................  3090-0204
552.214-71.................................  3090-0200
552.216-70.................................  3090-0243
552.216-72.................................  3090-0248
552.216-73.................................  3090-0248
552.219-72.................................  3090-0252
552.223-72.................................  3090-0205
552.232-72.................................  3090-0080
552.237-70.................................  3090-0197
552.237-71.................................  3090-0006
552.238-70.................................  3090-0250
552.238-72.................................  3090-0262
552.238-74.................................  3090-0121, 3090-0250
552.242-70.................................  3090-0027
552.246-70.................................  3090-0027
552.246-71.................................  3090-0027
552.249-71.................................  3090-0227
GSA-72-A...................................  3090-0121
GSA-527....................................  3090-0007
GSA-618-D..................................  1215-0149
GSA-1142...................................  3090-0080
GSA-1364...................................  3090-0086
GSA-1678...................................  3090-0027
GSA-2419...................................  9000-0102
570.702(c).................................  3090-0086
------------------------------------------------------------------------


[64 FR 37203, July 9, 1999, as amended at 65 FR 41378, July 5, 2000; 68 
FR 41288, July 11, 2003]



             Subpart 501.4_Deviations From the FAR and GSAR



501.402  Policy.

    Uniformity is a goal of GSA's Acquisition Regulation System. Despite 
this desire for uniformity, a contracting activity may take any of the 
following actions:
    (a) Develop and test new procedures and techniques.
    (b) Adopt alternate procedures in the public interest for unique 
programmatic or managerial requirements
    (c) Deviate from a regulatory provision implementing a statutory 
requirement provided the deviation does not violate the underlying 
statute. Deviations must not be used to defeat the FAR and GSAR approval 
requirements.



501.403  Individual deviations.

    (a) An individual deviation affects only one contract action.
    (1) The Head of the Contracting Activity (HCA) must approve an 
individual deviation to the FAR. The authority to grant an individual 
deviation may not be re-delegated. A copy of the deviation must be 
provided to GSA's Senior Procurement Executive (SPE).
    (2) An individual deviation to the GSAR must be approved by the HCA. 
The authority to grant an individual deviation may be re-delegated to 
the Contracting Director.
    (b) If GSA delegates authority to another agency and requires 
compliance with the GSAR as a condition of the delegation, the 
Contracting Director in the agency receiving the delegation may approve 
individual deviations from the GSAR unless the agency head receiving the 
delegation designates another official.
    (c) Send a copy of each deviation to GSA's SPE (V).

[64 FR 37203, July 9, 1999, as amended at 70 FR 15779, Mar. 29, 2005]



501.404  Class deviations.

    (a) A class deviation affects more than one contract action. A 
deviation for any solicitation that will result in multiple awards or 
any solicitation under the multiple award Federal Supply Schedule 
program is considered to be a class deviation. Each award under such a 
solicitation is considered an individual contract action.
    (1) A class deviation to the FAR must be forwarded by the cognizant 
HCA to GSA's SPE for approval. Prior to approving a class deviation to 
the FAR,

[[Page 167]]

the SPE will consult with the Chairman of the Civilian Agency 
Acquisition Council (CAAC) in accordance with FAR 1.404(a)(1).
    (2) A class deviation to the GSAR must be forwarded by the cognizant 
HCA to GSA's SPE for approval.
    (3) When an HCA knows that a proposed class deviation will be 
required on a permanent basis, the HCA should propose or recommend an 
appropriate FAR and/or GSAR revision.
    (b) If GSA delegates authority to another agency and requires 
compliance with the GSAR as a condition of the delegation, the HCA in 
the agency receiving the delegation may approve class deviations from 
the GSAR unless the agency head receiving the delegation designates 
another official.
    (c) Send a copy of each deviation to GSA's SPE (V).
    (d) A request for class deviations must be supported by statements 
that fully describe the need for and the nature of the deviation.
    (e) Class deviations from the GSAR:
    (1) Expire in 12 months if not extended.
    (2) May be rescinded earlier by GSA's SPE or by officials designated 
under paragraph (a) of this section without prejudice to any action 
taken previously.

[64 FR 37203, July 9, 1999, as amended at 70 FR 15780, Mar. 29, 2005]



501.404-70  Contract action.

    Contract action. A contract action, for the purpose of determining 
whether an individual or class deviation is appropriate, has the same 
meaning as that used for reporting contract actions to Federal 
Procurement Data System--Next Generation (FPDS-NG). A contract action 
includes, but is not limited to, any of the following:
    (a) Initial letter contract.
    (b) Definitive contract superseding letter contract.
    (c) New definitive contract.
    (d) Purchase order/BPA calls using simplified acquisition 
procedures.
    (e) Orders under single award indefinite delivery contracts.
    (f) Orders under BOA.
    (g) Order/modification under Federal schedule contract.
    (h) Modification.
    (i) Termination for Default.
    (j) Termination for Convenience.
    (k) Order under multiple award contract.
    (l) Initial load of Federal schedule contract.

[70 FR 15780, Mar. 29, 2005]



501.404-71  Deviations to the nonregulatory GSAM.

    Handle individual and class deviations to the nonregulatory 
(unshaded) part of the GSAM as stated in 501.403 and 501.404.

[70 FR 15780, Mar. 29, 2005]



PART 502_DEFINITIONS OF WORDS AND TERMS--Table of Contents




    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37204, July 9, 1999, unless otherwise noted.



                        Subpart 502.1_Definitions



502.101  Definitions.

    Agency competition advocate means the GSA Competition Advocate in 
the Office of Acquisition Policy.
    Assigned counsel means the attorney employed by the Office of 
General Counsel (including offices of Regional Counsel) assigned to 
provide legal review or assistance.
    Contracting activity competition advocate means the individual 
designated in writing by the head of the contracting activity (HCA). 
This authority may not be redelegated. The HCA must ensure that the 
designated competition advocate is not assigned any duty or 
responsibility that is inconsistent with the advocacy function. The 
identity of the designated official shall be communicated to procuring 
staff and the Senior Procurement Executive.
    Contracting director means:
    (a) Except in FSS, a director of a Central Office or Regional office 
Division responsible for performing contracting or contract 
administration functions.
    (b) In FSS, a director of a Commodity Center or FSS Bureau.

[[Page 168]]

    Contracting officer's representative (COR), contracting officer's 
technical representative (COTR), or contract administrator means a 
Government employee designated in writing by the contracting officer to 
perform specific limited activities for the contracting officer, such as 
contract administration.
    Debarring official or suspending official means the Senior 
Procurement Executive or a designee.
    Head of the contracting activity means the Deputy Associate 
Administrator for Acquisition Policy (MV); Commissioners of the Federal 
Technology Service (FTS); Federal Supply Service (FSS), or Public 
Buildings Service (PBS); or Regional Administrators. The Deputy 
Associate Administrator for Acquisition Policy serves as the HCA for 
Central Office contracting activities outside of FTS, FSS, and PBS.
    Senior procurement executive means the Deputy Associate 
Administrator for Acquisition Policy.
    Senior program official means a person reporting to, and designated 
by, the HCA to have overall program responsibility for determining how 
the agency will meet its need. The official should have a position of 
authority over the participating offices. Examples include Assistant 
Regional Administrators or Deputy Commissioners.



PART 503_IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST--Table of Contents




                        Subpart 503.1_Safeguards

Sec.
503.104 Procurement integrity.
503.104-3 Definitions.
503.104-9 Contract clauses.

       Subpart 503.2_Contractor Gratuities to Government Personnel

503.204 Treatment of violations.

                      Subpart 503.4_Contingent Fees

503.404 Contract clause.

             Subpart 503.5_Other Improper Business Practices

503.570 Advertising.
503.570-1 Policy.
503.570-2 Contract clause.

             Subpart 503.7_Voiding and Rescinding Contracts

503.702 Definition.
503.705 Procedures.

    Authority: 40 U.S.C. 486(c).

    Source: At 64 FR 37204, July 9, 1999, unless otherwise noted.



                        Subpart 503.1_Safeguards



503.104  Procurement integrity.



503.104-3  Definitions.

    Federal agency procurement as used in FAR 3.104 and in this section, 
also means acquisitions of leasehold interests in real property.



503.104-9  Contract clauses.

          Acquisitions of Leasehold Interests in Real Property

    Insert a clause substantially the same as the clause at 552.203-70, 
Price Adjustment for Illegal or Improper Activity, in solicitations and 
contracts for and modifications to leasehold interests in real property 
exceeding $100,000.



       Subpart 503.2_Contractor Gratuities to Government Personnel



503.204  Treatment of violations.

    (a) The Senior Procurement Executive, or designee, makes 
determinations under FAR 3.204.
    The Senior Procurement Executive, or designee, takes all the 
following actions:
    (1) Coordinates with legal counsel.
    (2) Initiates proceedings under FAR 3.204(a) by notifying the 
contractor that GSA is considering action against the contractor for a 
violation of the Gratuities clause. Notice is sent by a certified letter 
to the last known address of the party, its counsel, or agent for 
service of process. In the case of a business, notice is sent to any 
partner, principal officer, director, owner or co-owner, or joint 
venture.
    (3) Presumes receipt if no return receipt is received within 10 
calendar days after mailing the notice.

[[Page 169]]

    (b) The contractor has 30 calendar days to exercise its rights under 
FAR 3.204(b), unless the Senior Procurement Executive, or designee, 
grants an extension.
    (c) If there is a dispute of fact material to making a 
determination, the Senior Procurement Executive, or designee, may refer 
the matter to an agency fact-finding official designated by the Chairman 
of the GSA Board of Contract Appeals. Referrals for fact-finding are not 
made in cases arising from a conviction or indictment as defined in FAR 
9.403. If a referral is made, the fact-finding official takes all the 
following actions:
    (1) Gives the contractor an opportunity to dispute material facts 
relating to the determinations under FAR 3.204(a)(1) and (2).
    (2) Conducts proceedings under rules consistent with FAR 3.204(b).
    (3) Schedules a hearing within 20 calendar days of receipt of the 
referral. The contractor or GSA may request an extension for good cause.
    (4) Delivers to the Senior Procurement Executive, or designee, 
written findings of fact (together with a transcription of the 
proceedings, if made) within 20 calendar days after the hearing record 
closes. The findings must resolve any material disputes of fact by a 
preponderance of the evidence.
    (d) The Senior Procurement Executive, or designee, may reject the 
findings of the fact-finding official only if the findings are clearly 
erroneous or arbitrary and capricious.
    (e) In cases arising from conviction or indictment, or in which 
there are no disputes of material fact, the Senior Procurement 
Executive, or designee, conducts the hearing required by FAR 3.204(b).
    (f) If the Gratuities clause was violated, the contractor may 
present evidence of mitigating factors to the Senior Procurement 
Executive, or designee, either orally or in writing, in accordance with 
a schedule the Senior Procurement Executive, or designee, establishes. 
The Senior Procurement Executive, or designee, exercises the 
Government's rights under FAR 3.204(c) only after considering mitigating 
factors.



                      Subpart 503.4_Contingent Fees



503.404  Contract clause.

    Insert 552.203-5, Covenant Against Contingent Fees, in solicitations 
and contracts for the acquisition of leasehold interests in real 
property expected to exceed $100,000.



             Subpart 503.5_Other Improper Business Practices



503.570  Advertising.



503.570-1  Policy.

    GSA policy precludes contractors from referring to GSA contracts in 
commercial advertising in a manner that states or implies the Government 
approves or endorses the product or service or considers it superior to 
other products or services. The intent of this policy is to prevent the 
appearance of Government bias toward any product or service.



503.570-2  Contract clause.

    Insert the clause at 552.203-71, Restriction on Advertising, in 
solicitations and contracts, including acquisitions of leasehold 
interests in real property, if the contract amount is expected to exceed 
the simplified acquisition threshold.



             Subpart 503.7_Voiding and Rescinding Contracts



503.702  Definition.

    Notice means a letter sent by certified mail with a return receipt 
requested to the last known address of a party, its counsel, or agent 
for service of process. In the case of a business, such notice may be 
sent to any partner, principal officer, director, owner or co-owner, or 
joint venturer. If no return receipt is received within 10 calendar days 
of mailing, receipt is presumed.
    Voiding and rescinding official means the Senior Procurement 
Executive or designee.



503.705  Procedures.

    (a) Contracting officer's actions:
    (1) If a contract is tainted by misconduct, consult with assigned 
counsel

[[Page 170]]

to determine if the Government has a common law remedy such as 
avoidance, rescission, or cancellation.
    (2) If the contractor has a final conviction for a violation under 
18 U.S.C. 201-224, you may refer the matter to the voiding and 
rescinding official under FAR 3.705.
    (i) In the referral, identify the final conviction and include the 
information required by FAR 3.705(d)(2) through (5).
    (ii) Coordinate the referral with the Office of Inspector General to 
determine whether to recommend debarment.
    (3) You may postpone a decision to exercise the Government's common 
law right to void, rescind, or cancel a contract until completion of 
legal proceedings against the contractor.
    (b) Voiding and rescinding official's actions:
    (1) The voiding and rescinding official reviews the referral and 
coordinates with assigned counsel and the contracting activity.
    (2) If the official decides to declare void and rescind a contract 
and to recover the amounts expended and the property transferred, the 
official takes both the following actions:
    (i) Issues the notice required by FAR 3.705.
    (ii) Conducts the hearing contemplated by FAR 3.705(c)(3).
    (3) In case of a dispute of material fact about the agency decision, 
the official refers the matter to the fact-finding official designated 
by the Chairman of the GSA Board of Contract Appeals. The voiding and 
rescinding official makes this referral if the dispute of fact relates 
to any of the following:
    (i) Contracts affected by the final conviction.
    (ii) Amounts expended and property transferred by the Government 
under the affected contracts.
    (iii) Identity and value of any tangible benefits received by the 
Government under the affected contracts.
    (4) The voiding and rescinding official issues GSA's final decision 
under FAR 3.705(e) after receiving the fact-finding official's report, 
if a referral was made. The voiding and rescinding official may reject 
the fact-finding official's findings only if they are clearly erroneous 
or arbitrary and capricious.
    (5) The official coordinates the final decision was the contracting 
activity and provides the activity a copy of the decision.
    (c) Fact-finding official's actions: The fact-finding official takes 
all the following actions:
    (1) Gives the contractor an opportunity to dispute material facts.
    (2) Conducts the proceedings under rules consistent with FAR 
3.705(c)(3).
    (3) Schedules a hearing within 20 calendar days after receiving the 
referral. The official may grant extensions for good cause at the 
request of the contractor or GSA.
    (4) Delivers written findings of fact to the voiding and rescinding 
official (together with a transcription of the proceeding, if made) 
within 20 calendar days after the hearing record closes. The findings 
must resolve any material disputes of fact by a preponderance of the 
evidence.



PART 504_ADMINISTRATIVE MATTERS--Table of Contents




    Subpart 504.4_Safeguarding Classified Information Within Industry

Sec.
504.402 General.
504.475 Return of classified information.

            Subpart 504.5_Electronic Commerce in Contracting

504.500 Scope of subpart.
504.502 Policy.
504.570 Procedures for using the EPS.

                    Subpart 504.6_Contract Reporting

504.602-71 Federal Procurement Data System--Public access to data.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37205, July 9, 1999, unless otherwise noted.



    Subpart 504.4_Safeguarding Classified Information Within Industry



504.402  General.

    (a) This subpart:
    (1) Prescribes procedures for safeguarding classified information 
required to be disclosed to contractors in

[[Page 171]]

connection with the solicitation of offers, and the award, performance, 
and termination of contracts.
    (2) Implements the requirements of the Department of Defense's 
Industrial Security Regulation (ISR) and Industrial Security Manual for 
Safeguarding Classified Information (ISM). By agreement, the Department 
of Defense (DOD) will act for, and on behalf of, GSA in rendering 
security services required for safeguarding classified information 
released by GSA to U.S. industry.
    (b) As used in this subpart, the term:
    (1) ``Contractor(s)'' means prospective contractors, subcontractors, 
vendors, and suppliers.
    (2) ``U.S. industry'' means those industries (including educational 
and research institutions) located within the United States, its 
possessions, and the Commonwealth of Puerto Rico.



504.475  Return of classified information.

    (a) You must recover classified information unless it has been 
destroyed as provided in paragraph 19 of the ISM. The Government agency 
that provided classified information to a GSA contractor is responsible 
for the return of the information.
    (b) You must ensure that classified information furnished to 
prospective offerors, offerors, or contractors is returned immediately 
after any of the following:
    (1) After bid opening or closing date for receipt of proposals by 
non-responding offerors.
    (2) After contract award by unsuccessful offerors.
    (3) Upon termination or completion of the contract.
    (4) Upon notification that authorization to release classified 
information has been withdrawn.
    (5) After notification that a facility:
    (i) Does not have adequate means to safeguard classified 
information.
    (ii) Has had its security clearance revoked or inactivated.
    (6) Whenever otherwise instructed by the authority responsible for 
the security classification.



            Subpart 504.5_Electronic Commerce in Contracting



504.500  Scope of subpart.

    This subpart provides policy and procedure for use of GSA's 
Electronic Posting System (EPS).



504.502  Policy.

    (a) The EPS is GSA's primary vehicle for disseminating synopses and 
written solicitations. GSA intends that the EPS will substitute for, not 
supplement, paper copies of solicitations. (Note that FAR 2.101 defines 
``in writing'' or ``written'' to include ``electronically transmitted 
and stored information.'')
    (b) This policy does not apply to orders placed against existing 
contracts, including Federal Supply Service schedule contracts.
    (c) Nothing in this policy limits your authority to obtain oral 
quotations or proposals as authorized by regulation (e.g., FAR 13.106-1 
or FAR 15.203(f)).



504.570  Procedures for using the EPS.

    (a) You must use the EPS to issue any synopsis required by FAR part 
5 or GSAR part 505.
    (b) You must issue each written solicitation on the EPS, except as 
provided in paragraphs (c)(2) and (d) of this section.
    (c) Although GSA intends that the EPS will substitute for paper 
copies of solicitations, web-based transactions are not practical in 
some industries or in some geographic areas at this time.
    (1) If you expect that electronic access to a solicitation will 
result in adequate competition, distribute the solicitation only through 
the EPS. Include the following notice in the related synopsis:

    GSA is issuing this solicitation only electronically. Interested 
parties may access the solicitation at http://www.eps.gov. This site 
provides instructions for downloading the solicitation file.

    (2) If you believe that distribution of paper copies is necessary to 
ensure adequate competition, document the file to justify distribution 
of paper copies. Include the notice in paragraph (c)(1) of this section 
in the related synopsis, leaving out the first sentence.

[[Page 172]]

    (d) In some cases, release of construction drawings must be 
controlled to ensure adequate security. In other cases, an exhibit or 
attachment incorporated in a solicitation may not be available 
electronically. In either of these cases, you must explain in both the 
synopsis and the solicitation how interested parties may obtain a copy. 
In addition to the notice required by paragraph (c), include a notice 
substantially the same as follows in both the synopsis and solicitation. 
Tailor the notice as necessary for the particular acquisition.

    This solicitation incorporates documents which are not available 
electronically. See [Identify the solicitation section that lists the 
subject documents]. Interested parties may request copies of these 
documents by writing the Contracting Officer at the address in [Identify 
address block in the solicitation].

    (e) The Electronic Posting System Manual provides detailed 
instructions for using the EPS. The Manual is available at http://
www.eps.gov/buyer.html.



                    Subpart 504.6_Contract Reporting



504.602-71  Federal Procurement Data System--Public access to data.

    (a) The FPDS database. The General Services Administration awarded a 
contract for creation and operation of the Federal Procurement Data 
System (FPDS) database. That database includes information reported by 
departments and agencies as required by Federal Acquisition Regulation 
(FAR) Subpart 4.6. One of the primary purposes of the FPDS database is 
to provide information on Government procurement to the public.
    (b) Fee for direct hook-up. To the extent that a member of the 
public requests establishment of real-time integration of reporting 
services to run reports from another application, a one-time charge of 
$2,500 for the original integration must be paid by the requestor. This 
one-time charge covers the setup and certification required for an 
integrator to access the FPDS database and for technical assistance to 
help integrators use the web services. The fee will be paid to the FPDS 
contractor and credited to invoices submitted to GSA by the FPDS 
contractor.

[69 FR 77662, Dec. 28, 2004]

[[Page 173]]



            SUBCHAPTER B_COMPETITION AND ACQUISITION PLANNING





PART 505_PUBLICIZING CONTRACT ACTIONS--Table of Contents




               Subpart 501.1_Dissemination of Information

Sec.
505.101 Methods of disseminating information.

           Subpart 505.2_Synopses of Proposed Contract Actions

505.202 Exceptions.
505.203 Publicizing and response time.
505.270 Synopsis of amendments to solicitations.

                    Subpart 505.5_Paid Advertisements

505.502 Authority.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37206, July 9, 1999, unless otherwise noted.



               Subpart 505.1_Dissemination of Information



505.101  Methods of disseminating information.

    (a) In Regions with a Business Service Center (BSC), you may post 
the notice required by FAR 5.101(a)(2) at the BSC.
    (b) Use GSA's Electronic Posting System (EPS) to issue each synopsis 
required by FAR part 5 or GSAR part 505. When synopsizing a 
solicitation, include the appropriate notice(s) required by 504.570(c) 
and (d).
    (c) For acquisitions involving real property:

------------------------------------------------------------------------
                                                Then you must publicize
  If the acquisition is not exempt under FAR   the proposed acquisition--
         5.202 or GSAR 505.202, and--
------------------------------------------------------------------------
(1) The acquisition is for real property       (1) Either:
 appraisal services estimated to cost $25,000   (i) In local newspapers.
 or more.                                       (ii) In the Commerce
                                                Business Daily through
                                                the EPS.
(2) The acquisition is for leasehold           (2) Either:
 interests in real property estimated to        (i) In local newspapers.
 exceed 10,000 square feet (except lease        (ii) In the Commerce
 construction on a preselected site).           Business Daily through
                                                the EPS.
(3) The acquisition is for a leasehold         (3) In the Commerce
 interest in a building to be constructed on    Business Daily through
 a preselected site.                            the EPS.
------------------------------------------------------------------------

    (d) You may publicize proposed leases of 10,000 square feet or less 
in local newspapers if it will serve to promote competition.



           Subpart 505.2_Synopses of Proposed Contract Actions



505.202  Exceptions.

    The Administrator has determined under section 18(c)(3) of the 
Office of Federal Procurement Policy Act, as amended (41 U.S.C. 
416(c)(3)) and Section 8(g)(3) of the Small Business Act, as amended (15 
U.S.C. 644(g)(3)) that:
    (a) Synopsizing in the CBD is not always appropriate for 
acquisitions of leasehold interests in real property (except lease 
construction on a designated site) or real property appraisal services. 
Your may publicize such contract actions following the procedures in 
505.101 and 505.203.
    (b) It is not appropriate or reasonable to publish an advance notice 
of any of the following:
    (1) Acquisitions of works of art, including the design, execution 
and installation of the artwork, under the Art-in-Architecture Program.
    (2) Supplemental agreements to leases of real property involving any 
of the following:
    (i) Expansion requests within the scope of a lease (see 570.403).
    (ii) Lease extensions under the conditions defined in 570.405.
    (iii) Building alterations within the scope of a lease (see 570.5).

[[Page 174]]



505.203  Publicizing and response time.

    (a) If you publicize in local newspapers under 505.101(c), ensure 
that the notice appears in local newspapers at least 3 calendar days 
before issuance of the solicitation. Except as provided in paragraph (B) 
of this section, allow at least these minimum response times:
    (1) For leasehold interests in real property, 20 calendar days 
between solicitation issuance and the date established for receipt of 
initial offers.
    (2) For real property appraisal services valued at less than either 
the Trade Agreements Act (TAA) threshold or the North American Free 
Trade Agreement (NAFTA) threshold, 10 calendar days between solicitation 
issuance and the date established for receipt of initial offers. The 
lower of the two thresholds governs.
    (3) For real property appraisal services valued at or over the TAA 
threshold or the NAFTA threshold, 40 calendar days from when the notice 
appears to receipt of initial offers. If the acquisition falls in a 
general category identified in an annual forecast, the period may be 
reduced to as few as 10 days. The lower of the two thresholds governs.
    (b) The following exceptions to the publicizing and response times 
in paragraph (a) of this section apply only to proposed acquisitions of 
leasehold interests in real property:
    (1) For a proposed acquisition conducted using simplified lease 
acquisition procedures (see 570.2), consider the individual acquisition 
and establish a reasonable response time.
    (2) In cases of urgency, provide as much time as possible and 
document the file.



505.270  Synopsis of amendments to solicitations.

    Synopsize in the CBD any solicitation amendment when the amendment 
either:
    (a) Increases the anticipated value of the proposed acquisition 
above the dollar threshold requiring synopsis.
    (b) Alters the scope of the proposed acquisition so that increased 
interest of contractors can be reasonably anticipated.



                    Subpart 505.5_Paid Advertisements



505.502  Authority.

    (a) Newspapers. The HCA, or designee, must approve publication of 
paid newspaper advertisements. Approval is not required if FAR 5.101 or 
505.101 requires publication. Document the contract file with the 
regulatory citation or written approval to support the use of paid 
newspaper advertisements.
    (b) Other media. Advance approval is not required to advertise in 
other media.



PART 509_CONTRACTOR QUALIFICATIONS--Table of Contents




            Subpart 509.1_Responsible Prospective Contractors

Sec.
509.105 Procedures.
509.105-1 Obtaining information.
509.105-2 Determinations and documentation.
509.106 Preaward surveys.
509.106-2 Requests for preaward surveys.

                Subpart 509.2_Qualifications Requirements

509.206 Acquisitions subject to qualification requirements.
509.206-2 Contract clause.

            Subpart 509.3_First Article Testing and Approval

509.306 Solicitation requirements.
509.308 Contract clauses.
509.308-1 Testing performed by the contractor.
509.308-2 Testing performed by the Government.

         Subpart 509.4_Debarment, Suspension, and Ineligibility

509.401 Applicability.
509.403 Definitions.
509.405 Effect of listing.
509.405-1 Continuation of current contracts.
509.405-2 Restrictions on subcontracting.
509.406 Debarment.
509.406-1 General.
509.406-3 Procedures.
509.407 Suspension.
509.407-1 General.
509.407-3 Procedures.

    Authority: 40 U.S.C. 486(c).

[[Page 175]]


    Source: 64 FR 37207, July 9, 1999, unless otherwise noted.



            Subpart 509.1_Responsible Prospective Contractors



509.105  Procedures.



509.105-1  Obtaining information.

    (a) From a prospective contractor. In making a determination of 
responsibility, you may use the GSA Form 527, Contractor's Qualification 
and Financial Information, to obtain information regarding financial 
capability from a prospective contractor.
    (b) From Government personnel. Solicit and consider information from 
all appropriate activities, including legal counsel, quality control, 
contract management, credit and finance, and the auditor before 
determining that an offeror is responsible. ``Auditor'' is either:
    (1) The Assistant Inspector General for Auditing (Central Office 
only).
    (2) The Regional Inspector General for Auditing.
    (3) Chief, Credit and Finance Section, the Heartland Region (for an 
evaluation of a prospective contractor's financial competence and 
credit).



509.105-2  Determinations and documentation.

    (a) Provide written notification to a prospective contractor you 
determine not responsible. Include the basis for the determination. 
Notification provides the prospective contractor with the opportunity to 
correct any problem for future solicitation.
    (b) Due to the potential for de facto debarment, avoid making 
repeated determinations of nonresponsiblity based on the same past 
performance information.
    (c) To provide for timely consideration of the need to institute 
action to debar a contractor, submit a copy of each nonresponsibility 
determination, other than those based on capacity or financial 
capability, to the debarring official.



509.106  Preaward surveys.



509.106-2  Requests for preaward surveys.

    Federal Supply Service (FSS). Contracting activities in FSS may use 
GSA Form 353, Performance Evaluation & Facilities Report, in lieu of SF 
1403 through 1406. Complete Section I in accordance with instructions in 
553.370-353-I.



                Subpart 509.2_Qualifications Requirements



509.206  Acquisitions subject to qualification requirements.



509.206-2  Contract clause.

    Insert 552.209-70, Product Removal from Qualified Products List, in 
solicitations and contracts containing FAR 52.209-1, Qualification 
Requirements.



            Subpart 509.3_First Article Testing and Approval



509.306  Solicitation requirements.

    (a) The clauses at FAR 52.209-3 and 52.209-4 do not cover all the 
solicitation requirements described in FAR 9.306. If a solicitation 
contains a testing and approval requirement, you must address the 
requirements in FAR 9.306 (d), (f), (g), (h), (i), and (j). For FSS, the 
clauses prescribed in 509.308 address the requirement in FAR 9.306(h).
    (b) In FSS solicitations that contain FAR 52.209-3, First Article 
Approval--Contractor Testing, or FAR 52.209-4, First Article Approval--
Government Testing, insert 552.209-71, Waiver of First Article Testing 
and Approval Requirement.



509.308  Contract clauses.



509.308-1  Testing performed by the contractor.

    In FSS solicitations and contracts that will require the contractor 
to perform testing, insert 552.209-72, Supplemental Requirements for 
First Article Approval--Contractor Testing, and FAR 52.209-3, Alternate 
I.

[[Page 176]]



509.308-2  Testing performed by the Government.

    In FSS solicitations and contracts that will have the Government 
responsible for first article testing, insert 552.209.73, Supplemental 
Requirements for First Article Approval--Government Testing, and FAR 
52.209-4, Alternate I.



         Subpart 509.4_Debarment, Suspension, and Ineligibility



509.401  Applicability.

    This subpart applies to all the following:
    (a) Acquisitions of personal property, nonpersonal services 
(including construction), space in buildings, transportation services 
(Federal Property Management Regulations (FPMR) Subpart 101-40.4).
    (b) The purchase, sale, and disposal of real property.
    (c) Contracts for disposal of personal property (FPMR Subpart 101-
45.6).
    (d) Covered transactions as defined at General Services Property 
Management Regulations (GSPMR) 105-68.110(a).



509.403  Definitions.

    Fact-finding official, means the Chairman of the Debarment and 
Suspension Board within the GSA Board of Contract Appeals or a designee.
    Notice means a letter sent by certified mail, return receipt 
requested, to the last known address of a party, its counsel, or agent 
for service of process. In the case of a business, such notice may be 
sent to any partner, principal officer, director, owner or co-owner, or 
joint venturer. If no return receipt is received within 10 calendar days 
of mailing, receipt will then be presumed.



509.405  Effect of listing.



509.405-1  Continuation of current contracts.

    (a) Consider terminating a current contract under any of the 
following circumstances:
    (1) Any of the circumstances giving rise to the debarment or 
suspension also constitute a default in the contractor's performance of 
the contract.
    (2) The contractor presents a significant risk to the Government in 
completing the contract.
    (3) The conduct that provides the cause of the suspension, proposed 
debarment, or debarment involved a GSA contract.
    (b) Determine which of the following is in the Government's best 
interest:
    (1) Terminate the contract for either convenience or cause.
    (2) Cancel under appropriate contract clauses (e.g., 552.238-73, 
Cancellation).
    (3) Use other available alternatives under:
    (i) FAR 3.2 and 503.2.
    (ii) FAR 3.7 and 503.7.
    (c) Before making a decision, consult with legal counsel and 
consider these factors:
    (1) Seriousness of the cause for debarment or suspension.
    (2) Extent of contract performance.
    (3) Potential costs of termination and reprocurement.
    (4) Need for or urgency of the requirement, contract coverage, and 
the impact of delay for reprocurement.
    (5) Availability of other safeguards to protect the Government's 
interest until completion of the contract.
    (6) Availability of alternate competitive sources to meet the 
requirement (e.g., other multiple award contracts, readily available 
commercial items, etc.).
    (d) The debarring official is the designee under FAR 9.405-1(c).



509.405-2  Restrictions on subcontracting.

    The debarring official is the designee under FAR 9.405-2(a).



509.406  Debarment.



509.406-1  General.

    The debarring official is the designee under FAR 9.406-1(c).



509.406-3  Procedures.

    (a) Investigation and referral. (1) Refer to the debarring official 
matters involving serious contract improprieties or performance 
deficiencies. Performance deficiencies that continue over a period of 
time or apply to more than one contract may warrant debarment 
consideration.

[[Page 177]]

    (2) Refer possible criminal or fraudulent activities to the Office 
of the Inspector General (OIG). See 5 CFR 6701.107, Reporting Waste, 
Fraud, Abuse, and Corruption. If, after investigation, the OIG believes 
a cause for debarment exists, it will refer the matter to the debarring 
official for consideration of debarment action.
    (b) Reports. Include in referrals to the debarring official a report 
that contains at least the following:
    (1) The recommendation and supporting rationale.
    (2) A list of parties to be considered for possible debarment, 
including the contractor, principals, and affiliates. Include last known 
home and business addresses, zip codes, and DUNS Number.
    (3) A statement of facts.
    (4) Copies of documentary evidence and a list of witnesses. Include 
addresses and telephone numbers. Determine their availability to appear 
at a fact-finding proceeding and identify the subject matter of their 
testimony.
    (5) GSA's acquisition history with the contractor. Include recent 
experience, copies of the pertinent contracts, and an explanation of 
impact debarment would have on GSA programs. OIG referrals do not 
require this explanation; the debarring official will obtain the 
information directly from the contracting activity(s).
    (6) A list of any known active or potential criminal investigations, 
criminal or civil proceedings, or administrative claims before the Board 
of Contract Appeals.
    (7) A statement regarding the impact of the debarment action on GSA 
programs. This statement is not required for referrals by the Inspector 
General; the debarring official will obtain a statement directly from 
the contracting activity(s).
    (c) Review. The debarring official will review the report, and after 
coordinating with assigned legal counsel, either:
    (1) Initiate debarment action.
    (2) Decline debarment action.
    (3) Request additional information.
    (4) Refer the matter to the OIG for further investigation and 
development of a case file.
    (d) Decisionmaking process. (1) The debarring official will provide:
    (i) Notice of declinations, proposed debarments, and decisions to 
the referring activity.
    (ii) Notice of proposed debarment to each party being considered for 
debarment.
    (iii) Decision notices to each party after considering information 
in the administrative record and information and argument submitted by 
the affected party or parties.
    (2) A party proposed for debarment:
    (i) Has 30 calendar days after receipt of the notice to respond to 
the debarring official or the debarment becomes final.
    (ii) May request and receive a copy of the administrative record 
that was the basis for the proposed debarment. If information is 
withheld, the party will be notified and provided the reason.
    (iii) May request the opportunity to present information and 
argument in person to the debarring official. The debarring official 
will schedule an oral presentation within 20 calendar days of receipt of 
the request, unless a longer period of time is requested by the party. 
An oral presentation is informal and a transcript usually is not made. 
The party may supplement the oral presentation with written information 
and arguments.
    (iv) May identify to the debarring official material facts in 
dispute and the bases. For an action other than one based on a 
conviction of civil judgment, a party may request review and a written 
finding by a fact-finding official.
    (3) The debarring official will determine whether there is a genuine 
dispute of material fact. If so, the debarring official refers the 
matter to a fact-finding official, who will take the following action as 
appropriate:
    (i) Schedule a hearing within 20 calendar days after receipt of a 
request to resolve disputed facts.
    (ii) Grant extensions for good cause.
    (iii) Provide notice of scheduled hearing.
    (iv) Conduct hearings under rules consistent with FAR 9.406-3(b)(2).
    (v) Resolve facts in dispute and provide the debarring official with 
written

[[Page 178]]

findings of fact based on a preponderance of the evidence. The fact-
finding official provides the written findings of fact (together with a 
transcription of the proceeding, unless waived) within 20 calendar days 
after the hearing record closes.



509.407  Suspension.



509.407-1  General.

    The suspending official is the designee under FAR 9.407-1(d).



509.407-3  Procedures.

    (a) General. The procedures in 509.406-3 apply to suspension actions 
except as noted in paragraph (b) of this section.
    (b) Fact-finding. (1) Fact-finding will not be conducted in an 
action:
    (i) Based on an indictment.
    (ii) When the suspending official finds no genuine dispute of 
material facts.
    (2) If the action is not based on an indictment, the suspending 
official must coordinate with the Department of Justice or state 
prosecutorial authority through OIG. Based on the advice received, the 
suspending official will determine if fact-finding would impair 
substantial interests of the Federal or state Government. In an action 
not based on an indictment, a suspended party may:
    (i) Identify to the suspending official material facts in dispute 
and the bases.
    (ii) Request review and a written finding by a fact-finding official 
to resolve genuine disputes of material fact. For procedures involving a 
genuine dispute of material fact, see 509.406-3(d)(3).



PART 511_DESCRIBING AGENCY NEEDS--Table of Contents




      Subpart 511.1_Selecting and Developing Requirements Documents

Sec.
511.104 Use of brand name or equal purchase descriptions.
511.104-70 Solicitation provisions.

       Subpart 511.2_Using and Maintaining Requirements Documents

511.204 Solicitation provisions and contract clauses.

             Subpart 511.4_Delivery or Performance Schedules

511.404 Contract clauses.

                Subpart 511.6_Priorities and Allocations

511.600 Scope of subpart.
511.601 Definitions.
511.602 General.
511.603 Procedures.
511.604 Solicitation provision and contract clause.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37209, July 9, 1999, unless otherwise noted.



      Subpart 511.1_Selecting and Developing Requirements Documents



511.104  Use of brand name or equal purchase descriptions.



511.104-70  Solicitation provisions.

    (a) Include the following immediately after each brand name or equal 
item description, with instructions for the offeror to complete the 
information:

    Offering on:

Manufacturer's Name_____________________________________________________
Brand___________________________________________________________________
Model or Part No._______________________________________________________

    (b) If the solicitation does not require samples for ``or equal'' 
offers, include the following notice in the list of brand name or equal 
items or component parts:

                                 Notice

    If you offer other than brand name items identified in this 
solicitation, you must provide adequate information for GSA to determine 
the quality of the product(s) offered.

    (c) If you use brand name or equal purchase descriptions for some 
component parts of an end item, you may limit the application of the 
provision at FAR 52.211-6 to the specified components

[64 FR 37209, July 9, 1999. Redesignated and amended at 65 FR 41378, 
July 5, 2000]

[[Page 179]]



       Subpart 511.2_Using and Maintaining Requirements Documents



511.204  Solicitation provisions and contract clauses.

    (a) Construction services. Insert the clause at 552.211-71, Standard 
References, in solicitations and contracts for construction services 
when you expect the contract amount to exceed the simplified acquisition 
threshold, and the solicitation meets either of the following 
conditions:
    (1) The solicitation cites documents or publications not furnished 
with the solicitation.
    (2) The solicitation incorporates documents or publications by 
reference.
    (b) Federal specifications. Insert the clause at 552.211-72, 
Reference to Specifications in Drawings, in solicitations and contracts 
citing Federal specifications which contain drawings.
    (c) Supply contracts that exceed the simplified acquisition 
threshold. (1) Include the clause at 552.211-73, Marking, in 
solicitations and contracts for supplies when deliveries may be made to 
both civilian and military activities and the contract amount is 
expected to exceed the simplified acquisition threshold.
    (2) Include the clause at 552.211-74, Charges for Marking, in 
solicitations and contracts that include the clause at 552.211-73 or a 
similar clause.
    (3) Include the clause at 552.211-75, Preservation, Packaging and 
Packing, in solicitations and contracts for supplies expected to exceed 
the simplified acquisition threshold. You may also include the clause in 
contracts estimated to be at or below the simplified acquisition 
threshold when appropriate. Use Alternate I in solicitations and 
contracts for--
    (i) Federal Supply Schedule 70;
    (ii) The Consolidated Schedule containing information technology 
Special Item Numbers;
    (iii) Federal Supply Schedule 84; and
    (iv) Federal Supply Schedules for recovery purchasing (see 
538.7102).
    (4) Insert a clause substantially the same as the clause at 552.211-
76, Charges for Packaging and Packing, in solicitations and contracts 
for supplies to be delivered to GSA distribution centers.
    (d) Supply contracts. Include the clause at 552.211-77, Packing 
List, in solicitations and contracts for supplies, including purchases 
over the micropurchase threshold. Use Alternate I in solicitations and 
contracts for--
    (1) Federal Supply Schedule 70;
    (2) The Consolidated Schedule containing information technology 
Special Item Numbers;
    (3) Federal Supply Schedule 84; and
    (4) Federal Supply Schedules for recovery purchasing (see 538.7102).

[64 FR 37209, July 9, 1999, as amended at 68 FR 24378, May 7, 2003; 68 
FR 28065, May 18, 2004; 72 FR 4652, Feb. 1, 2007; 73 FR 54337, Sept. 19, 
2008]



             Subpart 511.4_Delivery or Performance Schedules



511.404  Contract clauses.

    (a) Supply contracts--(1) Single award schedules. Insert 552.211-8, 
Time of Delivery, in solicitations and contracts instead of the clause 
at FAR 52.211-8. If you need to show different delivery times for 
different items or groups of items, use Alternate I.
    (2) Multiple award schedules. Insert 552.211-78, Commercial Delivery 
Schedule (Multiple Award Schedule), in solicitations issued and 
contracts awarded under the multiple award schedule program.
    (3) Shelf-life items. Use the following clauses in solicitations and 
contracts that require delivery of shelf-life items within a specified 
number of months from the date of manufacture or production (see 101-
27.206-2 of the Federal Property Management Regulation):
    (i) Insert 552.211-79, Acceptable Age of Supplies, if the required 
shelf-life period is 12 months or less, and lengthy acceptance testing 
may be involved. For items having a limited shelf-life, substitute 
Alternate I when required by the director of the commodity center 
concerned.
    (ii) Insert 552.211-80, Age on Delivery, if the required shelf-life 
period is more than 12 months, or when source inspection can be 
performed within a short time period.
    (4) Stock replenishment contracts. Insert 552.211-81, Time of 
Shipment, in

[[Page 180]]

solicitations and stock replenishment contracts that do not include the 
Availability for Inspection, Testing and Shipment/Delivery clause at 
552.211-83 and require shipment within 45 calendar days after receipt of 
the order. If shipment is required in more than 45 days, use Alternate 
I.
    (5) Notice of shipment. Include 552.211-82, Notice of Shipment, in 
solicitation and contracts for supplies when you need to have a notice 
of shipment from the contractor.
    (6) Indeterminate testing time. Insert 552.211-83, Availability for 
Inspection, Testing and Shipment/Delivery, in solicitations and 
contracts that provide for source inspection by Government personnel and 
that require lengthy testing for which time frames cannot be determined 
in advance. If the contract is for stock items, use Alternate I.
    (b) Construction contracts. Insert the clause at 552.211-84, Non-
Compliance with Contract Requirements, in solicitations and contracts 
for construction when you expect the contract amount to exceed the 
simplified acquisition threshold.



                Subpart 511.6_Priorities and Allocations

    Source: 69 FR 55934, Sept. 16, 2004, unless otherwise noted.



511.600  Scope of subpart.

    FAR Subpart 11.6 implements the Defense Priorities and Allocations 
System (DPAS), a Department of Commerce (DOC) regulation (15 CFR part 
700) to assure timely delivery of industrial resources (products, 
materials, and services) in support of approved national defense, 
energy, and civil emergency preparedness (Homeland Security) programs. 
Pursuant to DPAS Delegation 3, DOC delegated GSA the authority to use 
the DPAS in support of the GSA Federal Supply system. This subpart 
implements the DPAS within GSA.



511.601  Definitions.

    As used in this subpart--
    Approved program means a program determined as necessary or 
appropriate for priorities and allocations support to promote the 
national defense by the Secretary of Defense, the Secretary of Energy, 
or the Department of Homeland Security Under Secretary for Emergency 
Preparedness and Response under the authority of the Defense Production 
Act, the Stafford Act, and Executive Order 12919, or the Selective 
Service Act and related statutes, and Executive Order 12742. See 
Schedule 1 of 15 CFR part 700 for a list of Delegate Agencies, approved 
programs, and program identification symbols at http://www.bis.doc.gov/
DefenseIndustrialBasePrograms/OSIES/DPAS/Default.htm.
    Authorized person means a Delegate Agency, or other entity either 
permitted under 15 CFR part 700, or explicitly authorized by DOC to 
issue DPAS rated orders.
    Defense Priorities and Allocations System (DPAS) means the 
regulation published at 15 CFR part 700 that requires preferential 
treatment for certain contracts and orders placed by a Delegate Agency 
in support of an approved program.
    Delegate Agency means an agency of the U.S. Government authorized by 
delegation from DOC to place priority ratings on contracts or orders 
needed to support approved programs.
    Rated order means a prime contract, a subcontract, a purchase order, 
or a delivery or task order in support of an approved program issued in 
accordance with the provisions of the DPAS regulation (15 CFR part 700).



511.602  General.

    (a) The purpose of the DPAS is to assure the timely availability of 
industrial resources to meet current national defense, energy, and civil 
emergency preparedness program requirements and to provide an operating 
system to support rapid industrial response in a national emergency. The 
primary statutory authority for the DPAS is Title I of the Defense 
Production Act of 1950, as amended, with additional authority from the 
Selective Service Act of 1948, and the Robert T. Stafford Disaster 
Relief and Emergency Assistance Act. Executive Orders 12919 and 12742 
delegate this authority to the DOC to administer the DPAS.The DOC is 
further authorized to

[[Page 181]]

redelegate to heads of other departments and agencies (Delegate 
Agencies) authority under the DPAS for the priority rating of contracts 
and orders in support of approved programs. Within the DOC, the Office 
of Strategic Industries and Economic Security (SIES) is assigned the 
implementation, administration, and compliance responsibilities for the 
system.
    (b) The DPAS is published in the Code of Federal Regulations at 15 
CFR part 700. This regulation provides an overview, a detailed 
explanation of operations and procedures, and other implementing 
guidance, including information on special priorities assistance and 
compliance.
    (c) Orders placed under DPAS are ``rated orders.'' Rated orders must 
receive preferential treatment only as necessary to meet delivery 
requirements. Rated orders are identified by a rating symbol of either 
``DX'' or ``DO'' followed by a program identification symbol. All ``DO'' 
rated orders have equal priority with each other and take preference 
over unrated orders. All ``DX'' rated orders have equal priority with 
each other and take preference over ``DO'' rated orders and unrated 
orders. A program identification symbol indicates which approved program 
is supported by the rated order.
    (d) Only authorized persons may place an order containing a DPAS 
priority rating.
    (e) Within GSA, the Federal Supply Service (FSS) has been delegated 
the authority to issue rated orders to meet approved national defense, 
energy, and civil emergency preparedness program requirements of the 
supply distribution program. The Commissioner, FSS, shall issue 
additional guidance, as may be necessary, to ensure effective 
implementation of its delegated DPAS authority, such as the exclusions 
listed in paragraph F(2) of the 1998 DOC DPAS Delegation 3.
    (f) Executive Order 12919 defines the jurisdictional limitations as 
set forth in 15 CFR 700.18(b).



511.603  Procedures.

    (a) A DPAS rating may be placed against an entire contract at time 
of award or an individual order issued under an existing, otherwise 
unrated, contract.
    (b) When a DPAS rating is placed against an entire contract, the 
contracting officer must include the clause and provision prescribed at 
FAR 11.604, as well as the elements listed in paragraphs (c)(1) through 
(c)(3) of this section (see 15 CFR 700.12).
    (c) When a DPAS rating is placed against an individual order issued 
under an existing, otherwise unrated, contract, the order must include 
the following elements (see 15 CFR 700.12):
    (1) The appropriate priority rating symbol (i.e., either ``DO'' or 
``DX'') along with the program identification symbol. As required by the 
1998 DOC DPAS Delegation 3 to GSA, when GSA contracting officers place 
DO rated orders, they will use program identification symbol K1. When 
placing a DX rated order for other agencies, GSA contracting officers 
will use the requesting agency program identification symbol. When a 
Delegate Agency places its own orders, it uses its own program 
identification symbol. (See Schedule 1 of 15 CFR part 700 for a listing 
of Delegate Agencies, approved programs, and program identification 
symbols.)
    (2) A required delivery date. The words ``as soon as possible'' or 
``immediately'' do not constitute a required delivery date. A specific 
date or a specified number of days ARO (after receipt of order) is 
acceptable.
    (3) The written signature on a manually placed order, or the digital 
signature or name on an electronically placed order of an individual 
authorized to place rated orders.
    (4) A statement that reads substantially as follows:

    ``This is a rated order certified for national defense use, and you 
are required to follow all the provisions of the Defense Priorities and 
Allocations System regulation (15 CFR part 700).''

    (d) Multiple and Single Award Schedule contracts are not rated at 
time of award. Individual DPAS rated orders must include the elements 
listed in paragraphs (c)(1) through (c)(4) of this section.

[[Page 182]]



511.604  Solicitation provision and contract clause.

    The contracting officer must insert in full text the clause at 
552.211-15, Defense Priorities and Allocations System Requirements, in 
Single and Multiple Award Schedule solicitations and resultant 
contracts, except where the contract is wholly for products, materials, 
or services excluded from DPAS applicability (see 15 CFR 700.18).



PART 512_ACQUISITION OF COMMERCIAL ITEMS--Table of Contents




    Authority: 40 U.S.C. 486(c).



   Subpart 512.3_Solicitation Provisions and Contract Clauses for the 
                     Acquisition of Commercial Items



512.301  Solicitation provisions and contract clauses for the acquisition of commercial items.

    (a) Solicitation provisions and clauses. Insert these provisions or 
clauses in solicitations or solicitations and contracts, respectively, 
in accordance with the instructions provided:
    (1) 552.212-70, Preparation of Offer (Multiple Award Schedule), in 
solicitations and contracts issued under the multiple award schedule 
program.
    (2) 552.213-71, Contract Terms and Conditions Applicable to GSA 
Acquisition of Commercial Items, when listed clauses apply. The clause 
provides for incorporation by reference of terms and conditions which 
are, to the maximum extent practicable, consistent with customary 
commercial practice. If necessary, tailor this clause.
    (3) 552.212-72, Contract Terms and Conditions Required to Implement 
Statutes or Executive Orders Applicable to GSA Acquisitions of 
Commercial Items, when listed clauses apply. The clause provides for the 
incorporation by reference of terms and conditions required to implement 
provisions of law or executive orders that apply to commercial item 
acquisitions.
    (4) 552.213-73, Evaluation-Commercial Items (Multiple Award 
Schedule), in multiple award schedule solicitations. Use this provision 
instead of FAR 52.212-2.
    (b) Use of required provisions and clauses. Use only those 
provisions and clauses prescribed in this part. Unless the use of a 
provision or clause prescribed elsewhere in the GSAR is consistent with 
customary commercial practice for the item being acquired, disregard 
contrary instructions. Provisions and clauses prescribed in this part 
will be revised to reflect the applicability of new statutes and 
executive orders.
    (c) Discretionary use of GSAR provisions and clauses. Consistent 
with the limitations contained in FAR 12.302(c), include in 
solicitations and contracts by addendum other GSAR provisions and 
clauses.
    (d) Use of additional provisions and clauses. The Senior Procurement 
Executive must approve the use of a provision or clause that is either 
not:
    (1) Prescribed in the FAR or GSAR for use in contracts for 
commercial items.
    (2) Consistent with customary commercial practice.

[64 FR 37210, July 9, 1999, as amended at 65 FR 41378, July 5, 2000]

[[Page 183]]



           SUBCHAPTER C_CONTRACTING METHODS AND CONTRACT TYPES





PART 513_SIMPLIFIED ACQUISITION PROCEDURES--Table of Contents




              Subpart 513.3_Simplified Acquisition Methods

Sec.
513.302 Purchase orders.
513.302-70 Purchase order and related forms.
513.303 Blanket purchase agreements (BPAs).
513.303-3 Preparation of BPAs.
513.307 Forms.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37211, July 9, 1999, unless otherwise noted.



              Subpart 513.3_Simplified Acquisition Methods



513.302  Purchase orders.



513.302-70  Purchase order and related forms.

    (a) See GSA Order, Guidance on Use of the Credit Card for Purchases 
(CFO 4200.1), for forms required for purchase card actions.
    (b) Use GSA Form 3000 or 300-1 (pin-feed format), Order for Supplies 
and Services, instead of OF 347, Order for Supplies or Services, when 
making purchases payable through the National Electronic Accounting and 
Reporting (NEAR) System.
    (1) This form may also be used to make other purchases when a 
specific form is not prescribed. It may be used as a delivery or task 
order instead of SF 1449, Solicitation/Contract/Order for Commercial 
Items.
    (2) Prepare and process GSA Form 300 following the instructions at 
553.370-300-I. Use GSA Form 300A or 300-A(1) (pin-feed format), order 
for Supplies or Services (continuation), if additional space is needed.
    (c) Use GSA Form 1458, Motor Vehicle Shop Work Order, Repair and 
Purchase Order, instead of the OF 347 when making purchases in 
connection with the maintenance, servicing or repair of GSA fleet 
management vehicles.
    (d) Use GSA Form 3186, Order for Supplies or Services or GSA Form 
3186-B, Order for Supplies or Services (EDI), instead of OF 347, Order 
for Supplies or Services, when making simplified acquisitions or placing 
orders against established contracts through the FSS-19 system.
    (1) Use GSA Form 3186 for mail orders placed against established 
contracts.
    (2) Document the file for a delivery, task, or purchase order 
transmitted to contractors electronically using Electronic Data 
Interchange (EDI) procedures by generating a GSA Form 3186-B.
    (e) Use GSA Form 8002B, Motor Vehicle Delivery Order, to order fleet 
management vehicles. Do not use this form as a purchase order for 
simplified acquisitions. Use GSA Form 8002A to notify the consignee of 
the status of motor vehicle requisitions.

[64 FR 37211, July 9, 1999, as amended at 65 FR 11247, Mar. 2, 2000]



513.303  Blanket purchase agreements (BPAs).



513.303-3  Preparation of BPAs.

    (a) Description of agreement. Describe limitations, if any, on the 
geographic area to be served.
    (b) Delivery tickets. Instruct the contractor to include the name of 
the individual placing the order on the delivery ticket. The individual 
receiving the item or service must sign and date the delivery or service 
ticket. Both the supplier and the receiving office must retain a copy of 
the delivery ticket.



513.307  Forms.

    You may use the GSA Form 3521, Blanket Purchase Agreement, to 
prepare a blanket purchase agreement.



PART 514_SEALED BIDDING--Table of Contents




                   Subpart 514.2_Solicitation of Bids

Sec.
514.201 Preparation of invitations for bids.
514.201-1 Uniform contract format.
514.201-2 Part I--The Schedule.
514.201-6 Solicitation provisions.

[[Page 184]]

514.201-7 Contract clauses.
514.202 General rules for solicitation of bids.
514.202-4 Bid samples.
514.203 Methods of soliciting bids.
514.203-1 Transmittal to prospective bidders.
514.270 Aggregate awards.
514.270-1 Definition.
514.270-2 Guidelines for use.
514.270-3 Evaluation factors for award.
514.270-4 Grouping line items for aggregate award.
514.270-5 Evaluation methodologies for aggregate awards.
514.270-6 Guidelines for using the weight factors method.
514.270-7 Guidelines for using the price list method.

           Subpart 514.4_Opening of Bids and Award of Contract

514.407 Mistakes in bids.
514.407-3 Other mistakes disclosed before award.
514.407-4 Mistakes after award.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37211, July 9, 1999, unless otherwise noted.



                   Subpart 514.2_Solicitation of Bids



514.201  Preparation of invitations for bids.



514.201-1  Uniform contract format.

    Include the following notice in each solicitation:

    The information collection requirements contained in this 
solicitation/contract, are either required by regulation or approved by 
the Office of Management and Budget pursuant to the Paperwork Reduction 
Act and assigned OMB Control No. 3090-0162.



514.201-2  Part I--The Schedule.

    (a) When you use Standard Form 33, Solicitation, Offer and Award, 
include the following cautionary notice:

    Notice to Bidders--Use Item 13 of the Standard Form 33, 
Solicitation, Offer and Award, to offer prompt payment discounts. The 
Prompt Payment clause of this solicitation sets forth payment terms. Do 
not insert any statement in Item 13 which requires payment sooner than 
the time stipulated in the Prompt Payment clause. Example: If you insert 
``NET 20'' in Item 13, GSA will reject your offer as nonresponsive 
because the entry contradicts the 30 day payment terms specified in the 
Prompt Payment clause.

    (b) When you use any other authorized form (e.g., Standard Form 
1447, Solicitation/Contract), include the notice in paragraph (a) of 
this section. Change the reference to the form number, form title, and 
item number accordingly.



514.201-6  Solicitation provisions.

    When you will consider all or none bids, insert the provision at 
552.214-70, ``All or None'' Offers, in the solicitation. For 
requirements or indefinite quantity contracts, use Alternate I. Do not 
include this provision in solicitations when you require the bidder to 
submit bids on all items and will make only one award.



514.201-7  Contract clauses.

    (a) Stock replenishment contracts. For some stock replenishment 
contracts, individual contractors may be unable to furnish the 
Government's monthly requirements. You may determine that progressive 
awards will be more expedient. In such cases, insert a clause 
substantially the same as the clause 552.214-71, Progressive Awards and 
Monthly Quantity Allocations, in the solicitation and contract.
    (b) Examinations of Records. (1) Insert 552.214-70, Examination of 
Records by GSA, in solicitations and contracts for supplies or services 
that exceed $100,000, and acquisitions of leasehold interests in real 
property that exceed the simplified lease acquisition threshold, that 
meet at least one of the following conditions:
    (i) Involve the use or disposition of Government-furnished property.
    (ii) Provide for advance payments, progress payments based on cost, 
or guaranteed loan.
    (iii) Contain a price warranty or price reduction clause.
    (iv) Include an economic price adjustment clause where the 
adjustment is not based solely on an established, third party index.
    (v) Are requirements, indefinite-quantity, or letter contracts as 
defined in FAR part 16.
    (vi) Contain the provision at FAR 52.223-4, Recovered Materials 
Certification.
    (2) You may modify the clause to define the specific area of audit 
(e.g., the

[[Page 185]]

use or disposition of Government-furnished property). Legal Counsel and 
the Assistant Inspector General--Auditing or Regional Inspector 
General--Auditing, as appropriate, must concur in any modifications to 
the clause.



514.202  General rules for solicitation of bids.



514.202-4  Bid samples.

    (a) Solicitation requirements. (1) When you require bid samples, 
require bidders to submit samples produced by the manufacturer whose 
products will be supplied under the contract.
    (2) The FAR limits use of bid samples to cases where you cannot 
describe some characteristics of a product adequately in the 
specification or purchase description. This usually applies to 
subjective characteristics. You may determine that you need to examine 
objective characteristics of bid samples to determine the responsiveness 
of a bid. Base your determination on past experience or other valid 
considerations. In the solicitation, separately list ``Subjective 
Characteristics'' and ``Objective Characteristics.''
    (3) A sample provision appears at 552.214-72, Bid Sample 
Requirements. You may use this provision as shown or modify it to fit 
the circumstances of a procurement.
    (b) Handling and disposition of samples. (1) Retain samples from 
accepted bids for the period of contract performance. If you have no 
outstanding claims regarding the contract, dispose of the samples at the 
end of the contract term following the bidder's instructions.
    (2) If you anticipate a claim regarding the contract, retain the bid 
samples until the claim is resolved.
    (3) Retain samples from unsuccessful bids until you make award. 
After award, dispose of these samples following the bidder's 
instructions.
    (c) Using bid samples. Include the information required by FAR 
14.202-4(e) in the solicitation. Provide the number, size, and full 
description of samples with instructions on how to submit bids. List the 
characteristics that you will examine. The list needs to include any 
aspect of the bid sample the acquisition team will examine to determine 
the product(s) acceptability.



514.203  Methods of soliciting bids.



514.203-1  Transmittal to prospective bidders.

    Prospective bidders, as used in FAR 14.203-1, include both the 
following:
    (a) The incumbent contractor, except when its written response to 
the notice of contract action under FAR subpart 5.2 states a negative 
interest.
    (b) Bidders that responded to recent solicitations for the same or 
similar items.



514.270  Aggregate awards.



514.270-1  Definition.

    Aggregate award means an arrangement whereby two or more separately-
priced line items are combined for award to that bidder whose bid will 
result in the lowest overall cost to the Government for the line items 
as a group. The individual price for each item does not have to be the 
lowest bid received. (See also the definition of a ``line item'' in FAR 
3.302.)



514.270-2  Guidelines for use.

    (a) GSA usually solicits prices and reserves the right to make award 
for individual line items. In some cases it serves GSA's best interest 
to combine two or more line items for an aggregate award. Such cases 
include when:
    (1) Users desire uniformity of design, style, and finish (e.g., 
suites of household furniture).
    (2) The articles will be assembled and used as a unit, and different 
manufacturers' components may not be interchangeable.
    (3) Users have high demand for certain articles, but demand for 
related articles is insufficient to attract competitive bids (e.g., 
various sized of socket wrenches). Awarding the low-demand articles in 
conjunction with the high-demand articles may encourage competition.
    (4) One location (delivery point) has a large requirement, and 
another location has a requirement too small to individually attract 
competitive bids.

[[Page 186]]

    (5) Awarding and administering numerous small contracts for similar 
articles or services is impractical.
    (b) Before deciding to combine items for aggregate award, consider 
the following factors:
    (1) The capability of bidders to furnish the types and quantities of 
supplies or services in the aggregate.
    (2) How grouping delivery points will affect bidders.
    (3) Which combinations will accurately project the lowest overall 
cost to the Government.
    (c) Do not use an aggregate award if it will significantly restrict 
the number of eligible bidders.



514.270-3  Evaluation factors for award.

    Clearly state in the solicitation the basis for evaluating bids for 
aggregate award. Require bidders to submit a price on each item within 
the group or a percentage to be added or subtracted from a list price. 
Advise bidders that failure to submit prices as required within a group 
makes a bid ineligible for award for that group.



514.270-4  Grouping line items for aggregate award.

    (a) Type of contract. While this section addresses supply contracts 
(articles and delivery points), the same principles apply to service 
contracts (types of services and service areas).
    (b) Effect on compeition. Provide for full and open competition when 
you group items for award. Grouping items for award may preclude a 
significant of firms from bidding. This occurs if firms are unable to 
provide all the types or quanities of supplies or services, or make 
deliveries to the various delivery points included in the prospective 
aggregate group.
    (c) Grouping different articles. Include only related articles in an 
aggregate group. Related articles are those normally manufactured or 
produced by a majority of prospective bidders. Grouping unrelated 
articles often restricts competition unnecessarily.
    (d) Grouping geographic locations or delivery points. Consider the 
following guidelines before deciding to group different geographic 
locations or delivery points:
    (1) A delivery point may have sufficient requirements so that 
individual shipments involve economic production runs and carload or 
truckload quanities. In this case, list it as a separate line item.
    (2) The types of bidders (i.e., small or large firms, manufacturers 
or distributors, etc.) who respond to previous solicitations can provide 
important information. For example, if previous bidders are distributors 
with franchises in certain territories, grouping different territories 
could tend to restrict competition.
    (3) Transportation costs can affect competition and pricing. They 
may constitute a significant portion of the total delivered cost. Obtain 
the advice and assistance of transportation specialists before grouping 
geographic locations or delivery points. Depending upon the supplies 
being acquired:
    (i) Grouping widespread geographic locations or delivery points may 
reduce competition or result in higher prices. It can cause you to lose 
``area pricing'' advantages provided by a supplier with a single 
production point.
    (ii) Conversely, for many small commercial items (hand tools, locks, 
etc.), manufacturers may quote the same price for delivery anywhere in 
the U.S.
    (iii) Tariff boundaries can also affect how manufacturers price 
deliveries to different areas.



514.270-5  Evaluation methodologies for aggregate awards.

    (a) Definite quantity contracts without options. For definite 
quantity contracts without options, the evaluated bid price is the total 
bid price, as adjusted for any price-related factors identified in the 
solicitation. This reflects the actual cost to the Government and will 
identify the most advantageous bid.
    (b) Indefinite quantity contracts, requirements contracts, and 
options. Indefinite quantity and requirements contracts use estimated 
quantities. Options involve the probability of whether and when the 
options will be exercised. These situations may result in unbalanced 
bids (see FAR 15.404-1(g)), leading to inaccurate evaluation of the 
projected cost and award to other than the most advantageous bid. To 
avoid

[[Page 187]]

unbalanced bids, GSA has two preferred methods for evaluating bids for 
aggregate awards: weight factors and price list.
    (1) Weight factors method. Assign a weight to each item in a group. 
The weight is based on the portion of quantities that item represents. 
To evaluate bids, multiply each unit price by its weight factor, then 
total the results.
    (2) Price list method. Establish prices for bidders to use as a base 
for preparing their bids. Prepare a list that identifies a base price 
for each item in a group. Bidders bid a percentage factor to add to or 
subtract from the base price.



514.270-6  Guidelines for using the weight factors method.

    (a) Use the weight factors method when you have reliable estimates 
for the quantities needed in an acquisition. Reliable estimates of 
quantities form the foundation for:
    (1) Accurate evaluation of the projected cost of each bid.
    (2) An appropriate determination of which bid is most advantageous 
to the Government for the aggregate group.
    (b) Assign a weight factor to each item in a group. Develop the 
weight factor by calculating the portion of the total quantity in a 
defined group that each item represents.
    (c) To evaluate bid prices, first multiply the price bid for each 
item (unit price X quantity) by its weight factor. Then, add the 
subtotals together to project the cost for the aggregate group.
    (d) You may reduce estimated quantities to smaller numbers by a 
common denominator. This may help facilitate the computations involved 
in evaluating bids.
    (e) Consider all price-related factors you identified in the 
solicitation. Award to the responsive and responsible bidder with the 
lowest evaluated overall cost to the Government for the aggregate group. 
This represents the most advantageous bid.



514.270-7  Guidelines for using the price list method.

    (a) General. The price list method helps avoid unbalanced bidding 
when you need to make aggregate awards, but lack accurate estimates of 
anticipated quantities. This method establishes base prices for bidders 
to use in preparing their bids.
    (b) Solicitation requirements. When you use the price list methods, 
in the solicitation:
    (1) Include the price list.
    (2) Include an estimate of requirements.
    (3) Require the bidder to express its price as ``net'' or as a 
percentage added to or subtracted from the list prices for each group. 
Require the bidder to quote only one percentage factor for each group. 
This means that the bidder provides one percentage factor that applies 
to every item in a group; not a separate percentage for each item. 
``Net'' indicates the bidder chooses to submit the list prices as its 
bid.
    (4) Identify the percentage factor in paragraph (b)(3) of this 
section as a price related evaluation factor.
    (c) Developing list prices. You may develop price lists using one or 
more of the following sources:
    (1) Industry published prices.
    (2) Industry surveys.
    (3) Government cost estimates based on knowledge of the supplies or 
services and previous contract prices.
    (d) First time use for an item or service. The first time you use 
list prices for an item or service, give prospective bidders an 
opportunity to review the proposed list. Also provide information on how 
GSA will use the list prices. You may provide this information in a 
draft solicitation.
    (e) Balanced prices. Ensure that the list prices for the grouped 
items bear a reasonable and balanced relationship to one another. You 
may use prices from previous awards made using the weight factors method 
to develop price lists. Review those prices first to ensure they did not 
result from unbalanced bidding.
    (f) Evaluation and award. Consider all price-related factors 
identified in the solicitation. Award to the responsive and responsible 
bidder whose percentage factor produces the most favorable price to the 
Government. This represents the most advantageous bid.
    (g) Example. The following illustrates a bidding schedule 
arrangement for a

[[Page 188]]

group of items for aggregate award under the price list method:

 Drills, Twist, High Speed, Under Federal Specification (No. and Date), and Amendment (No. and Date), Amendment
                      (No. and Date) Wire Gauge Sizes, Straight Shank, Short Length, Type C
----------------------------------------------------------------------------------------------------------------
     Item No.        National Stock No.       Drill size       Est. quantity         Unit           List price
----------------------------------------------------------------------------------------------------------------
                                           Group 1 (Items 1 through 5)
----------------------------------------------------------------------------------------------------------------
1.................      5133-00-189-9246  1.................           2,800  Pkg...............          $11.16
2.................      5133-00-189-9247  2.................           2,400  Pkg...............           11.16
3.................      5133-00-189-9248  3.................           2,800  Pkg...............           10.44
4.................      5133-00-189-9249  4.................           1,600  Pkg...............           10.80
5.................      5133-00-189-9250  5.................           2,000  Pkg...............           10.80
----------------------------------------------------------------------------------------------------------------

    The bid on each item above is the list price shown minus/plus ---- 
percent. (Bidder, insert ``net'' or a single percentage amount in the 
blank space and cross out minus or plus, as appropriate.)
    (h) Special considerations for contracts for store stock items. Show 
estimated quantities only if estimates of demand for each item within a 
group can be derived from Government records or verified contractor 
sales reports. Use only current estimates. If you cannot estimate the 
Government's needs, the solicitation may include past orders. (See CG 
Decision, B-209037, 82-2 CPD para 323 (1982).)
    (i) Special considerations for repair and alteration contracts. In 
the solicitation:
    (1) List the estimated quantities for work to be performed during 
both normal working hours and outside of normal working hours.
    (2) State the percent of work anticipated to be performed during 
normal working hours.
    (3) List the unit prices for work to be performed during both normal 
working hours and outside of normal working hours.
    (4) Define ``normal'' in terms of hours and days of the week.
    (5) Advise bidders of the previous year's total expenditures or 
portions of that total attributable to the listed items.
    (6) If you provide quantity estimates, state that the estimates are 
for information only and do not constitute guarantees or commitments to 
order items under the contract.
    (7) Solicit two percentage factors for the line item unit prices 
listed: one for the unit prices for work performed during normal working 
hours and the second for the unit prices for work performed outside of 
normal working hours.
    (8) You may require multiple percentages when the solicitation 
further groups unit prices by trade or business category.
    (9) For the evaluated bid price, add together the following 
percentages:
    (i) The percentage of work performed during normal work hours 
multiplied by the total estimate adjusted by the bidder's percentage 
factor for that portion of the work, plus
    (ii) The percentage of work performed during other than normal 
working hours multiplied by the total estimate adjusted by the bidder's 
percentage factor for that portion of the work.
    (10) Consider other price-related factors identified in the 
solicitation. Make award to the responsible and responsive bidder 
submitting the lowest overall evaluated bid price for the aggregate 
group. This represents the most advantageous bid.



           Subpart 514.4_Opening of Bids and Award of Contract



514.407  Mistakes in bids.



514.407-3  Other mistakes disclosed before award.

    (a) Delegation of authority by head of the agency. Under FAR 14.407-
3(e), contracting directors (see 502.101) are authorized, without power 
of redelegation, to make:

[[Page 189]]

    (1) The determinations regarding corrections and withdrawals under 
FAR 14.407-3(a), (b), and (c).
    (2) The corollary determinations not to permit withdrawal or 
correction under FAR 14.407-3(d).
    (b) Legal review and approval. Assigned counsel must approve 
determinations by the contracting director and contracting officer 
regarding mistakes in bid.



514.407-4  Mistakes after award.

    The contracting director and assigned counsel review and approve 
your determinations under FAR 14.407-4(b) and (c).



PART 515_CONTRACTING BY NEGOTIATION--Table of Contents




   Subpart 515.2_Solicitation and Receipt of Proposals and Information

Sec.
515.204 Contract format.
515.204-1 Uniform contract format.
515.205 Issuing solicitations.
515.209 Solicitation provisions and contract clauses.
515.209-70 Examination of records by GSA clause.

                     Subpart 515.3_Source Selection

515.305 Proposal evaluation.
515.305-70 Use of outside evaluators.

                     Subpart 515.4_Contract Pricing

515.408 Solicitation provisions and contract clauses.

 Subpart 515.5_Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes

515.506 Postaward debriefing of offerors.

                      Subpart 515.70_Use of Samples

515.7002 Procedures.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37214, July 9, 1999, unless otherwise noted.



   Subpart 515.2_Solicitation and Receipt of Proposals and Information



515.204  Contract format.



515.204-1  Uniform contract format.

    (a) The uniform contract format is not required for leases of real 
property.
    (b) Each solicitation and contract must include the two notices in 
paragraphs (b)(1) and (b)(2) of this section, except that acquisitions 
of interests in real property, must include only the notice in (b)(1):
    (1) ``The information collection requirements contained in this 
solicitation/contract are either required by regulation or approved by 
the Office of Management and Budget pursuant to the Paperwork Reduction 
Act and assigned OMB Control No. 3090-0163.''
    (2) ``GSA's hours of operation are 8:00 a.m. to 4:30 p.m. Requests 
for preaward debriefings postmarked or otherwise submitted after 4:30 
p.m. will be considered submitted the following business day. Requests 
for postaward debriefings delivered after 4:30 p.m. will be considered 
received and filed the following business day.''



515.205  Issuing solicitations.

    Potential sources, as used in FAR 15.205, include both of the 
following:
    (a) The incumbent contractor, except when its written response to 
the notice of contract action under FAR subpart 5.2 states a negative 
interest.
    (b) Offerors that responded to recent solicitations for the same or 
similar items.



515.209  Solicitation provisions and contract clauses.



515.209-70  Examination of records by GSA clause.

             Clause for Other Than Multiple Award Schedules

    (a) For other than multiple award schedule (MAS) contracts, insert 
the clause at 552.215-70, Examination of Records by GSA, in 
solicitations and contracts over $100,000, including acquisitions of 
leasehold interests in real property, that meet any of the following 
conditions:

[[Page 190]]

    (1) Involve the use or disposition of Government-furnished property.
    (2) Provide for advance payments, progress payments based on cost, 
or guaranteed loan.
    (3) Contain a price warranty or price reduction clause.
    (4) Involve income to the Government where income is based on 
operations under the control of the contractor.
    (5) Include an economic price adjustment clause where the adjustment 
is not based solely on an established, third party index.
    (6) Are requirements, indefinite-quantity, or letter type contracts 
as defined in FAR part 6.
    (7) Are subject to adjustment based on a negotiated cost escalation 
base.
    (8) Contain the provision of FAR 52.223-4, Recovered Material 
Certification.
    (b) You may modify the clause at 552.215-70 to define the specific 
area of audit (e.g., the use or disposition of Government-furnished 
property, compliance with the price reduction clause). Counsel and the 
Assistant Inspector General--Auditing or Regional Inspector General--
Auditing, as appropriate, must concur in any modifications to the 
clause.

                   Clause for Multiple Award Schedules

    (c) Insert the clause at 552.215-71, Examination of Records by GSA 
(Multiple Award Schedule), in solicitations and contracts for MAS 
contracts.
    (d) With the Senior Procurement's Executive approval, you may modify 
the clause at 552.215-71 to provide for post-award access to and the 
right to examine records to verify that the pre-award/modification 
pricing, sales or other data related to the supplies or services offered 
under the contract which formed the basis for the award/modification was 
accurate, current, and complete. The following procedures apply:
    (1) Such a modification of the clause must provide for the right of 
access to expire 2 years after award or modification.
    (2) Before modifying the clause, you must make a determination that 
absent such access there is a likelihood of significant harm to the 
Government and submit it to the Senior Procurement Executive for 
approval.
    (3) The determinations under paragraph (d)(2) of this section must 
be made on a schedule-by-schedule basis.



                     Subpart 515.3_Source Selection



515.305  Proposal evaluation.

    (a) Restrictions placed on a proposal by the submitter. If you 
receive a proposal with more restrictive conditions than those in the 
provision at FAR 52.215-1(e), ask whether the submitter is willing to 
accept the conditions of the paragraph at FAR 52.215-1(e). If the 
submitter refuses, consult with legal counsel on whether to accept the 
proposal as marked or return it.
    (b) Actions before releasing proposal. Before releasing any proposal 
to an evaluator you must take all the following actions:
    (1) Obtain the signed original ``Conflict of Interest Acknowledgment 
and Nondisclosure Agreement'' from each Government and nongovernment 
individual serving as an evaluator. Use the Acknowledgment/Agreement in 
Figure 515.3-1.
    (i) For employees of other Executive agencies, replace the reference 
in paragraph (c) of the Acknowledgement/Agreement to GSA's supplemental 
standards with a reference to the applicable agency.
    (ii) for nongovernment evaluators, substitute paragraph (c) of the 
Acknowledgement/Agreement with the following language and delete 
paragraph (h):

    (c) I have read and understand the requirements of subsection 27(a) 
and 27(b) of the Office of Federal Procurement Policy Act (41 U.S.C. 
423).

    (2) Attach to each proposal a cover page bearing the following 
notice:

                Government Notice for Handling Proposals

    To anyone receiving this proposal or proposal abstract:
    (1) This proposal must be used and disclosed for evaluation purposes 
only.
    (2) You must apply a copy of this Government notice to any 
reproduction or abstract of this proposal.
    (3) You must comply strictly with any authorized restrictive notices 
which the submitter places on this proposal.

[[Page 191]]

    (4) You must not disclose this proposal outside the Government for 
evaluation purposes except to the extent authorized by, and in 
accordance with, the procedures in 48 CFR 515.305-71.



515.305-70  Use of outside evaluators.

    (a) Conditions. To use outside evaluators, you must meet the 
restrictions in FAR 37.203 and 537.2.
    (b) Limitations on disclosing proposal information. You may disclose 
proposal information outside the Government before the Government's 
decision as to contract award only to the extent authorized in this 
section. Disclosure and handling must comply with FAR 3.1 and 503.1.
    (c) Solicitation notice. Include in the solicitation a notice 
substantially as follows:

                    Notice About Releasing Proposals

    (1) The Government intends to disclose proposals received in 
response to this solicitation to nongovernment evaluators.
    (2) Each evaluator will sign and provide to GSA a ``Conflict of 
Interest Acknowledgment and Nondisclosure Agreement.''

 Figure 515.3-1--Conflict of Interest Acknowledgment and Nondisclosure 
                                Agreement

     Conflict of Interest Acknowledgment and Nondisclosure Agreement

    For proposals submitted in response to GAS solicitation no. --------
, I agree to the following:
    (a) To the best of my knowledge and belief, no conflict of interest 
exists that may either:
    (1) Diminish my capacity to impartially review the proposals 
submitted.
    (2) Or result in a biased opinion or unfair advantage.
    (b) In making the above statement, I have considered all the 
following factors that might place me in a position of conflict, real or 
apparent, with the evaluation proceedings:
    (1) All my stocks, bonds, other outstanding financial interests or 
commitments.
    (2) All my employment arrangements (past, present, and under 
consideration).
    (3) As far as I know, all financial interests and employment 
arrangements of my spouse, minor children, and other members of my 
immediate household.
    (c) I have read and understand the requirements of the Standards of 
Ethical Conduct for Employees of the Executive Branch (5 CFR Part 2635) 
and Supplemental Standards of Ethical Conduct for Employees of the 
General Service Administration (5 CFR Part 6701).
    (d) I have a continuing obligation to disclose any circumstances 
that may create an actual or apparent conflict of interest. If I learn 
of any such conflict, I will report it immediately to the Contracting 
Officer. I will perform no more duties related to evaluating proposals 
until I receive instructions on the matter.
    (e) I will use proposal information for evaluation purposes only. I 
understand that any authorized restriction on disclosure placed on the 
proposal by the prospective contractor, prospective subcontractor, or 
the Government applies to any reproduction or abstracted information of 
the proposal.
    (f) I will use my best efforts to safeguard proposal information 
physically. I will not disclose the contents of, nor release any 
information about, the proposals to anyone other than:
    (1) The Source Selection Evaluation Board or other panel assembled 
to evaluate proposals submitted in response to the solicitation 
identified above.
    (2) Other individuals designed by the contracting Officer.
    (g) After completing evaluation, I will return to the Government all 
copies of the proposals and any abstracts.
    (h) GSA Appropriations Act restriction: These restrictions are 
consistent with and do not supersede, conflict with or otherwise alter 
the employee obligations, rights, or liabilities created by Executive 
Order No. 12958; section 7211 of title 5, United States Code (governing 
disclosure of Congress); section 1034 of title 10, United States Code, 
as amended by the Military Whistleblower Protection Act (governing 
disclosure to Congress by members of the military); section 2302(b)(8) 
of title 5, United States Codes, as amended by the Whistleblower 
Protection Act (governing disclosures of illegality, waste, fraud, abuse 
or public health or safety threats); the Intelligence Identities 
Protection Act of 1982 (50 U.S.C. 421 et seq.) (governing disclosures 
that could expose confidential Government agents); and the statutes 
which protect against disclosure that may compromise the national 
security, including sections 641, 793, 794, 798, and 952 of title 18, 
United States Code, and section 4(b) of the Subversive Activities Act of 
1950 (50 U.S.C. 783(b). The definitions, requirements, obligations, 
rights, sanctions, and liabilities created by said Executive order and 
listed statutes are incorporated into this agreement and are 
controlling.
________________________________________________________________________
(Enter name of evaluator and organization)
________________________________________________________________________
Date

[[Page 192]]



                     Subpart 515.4_Contract Pricing



515.408  Solicitation provisions and contract clauses.

      MAS Requests for Information Other Than Cost or Pricing Data

    (a) You should use Alternative IV of the FAR provision at 52.215-20, 
Requirements for Cost or Pricing Data or Information Other than Cost or 
Pricing Data, for MAS contracts to provide the format for submission of 
information other than cost or pricing data for MAS contracts. To 
provide uniformity in request under the MAS program, you should insert 
the following in paragraph (b) of the provision:
    (1) An offer prepared and submitted in accordance with the clause at 
552.212-70, Preparation of Offer (Multuiple Award Schedule).
    (2) Commercial sales practices. The Offeror shall submit information 
in the format provided in this solicitation in accordance with the 
instructions at Figure 515.4 of the GSA Acquisition Regulation (48 CFR 
515-2), or submit information in the Offeror's own format.
    (3) Any additional supporting information requested by the 
Contracting Officer. The Contracting Officer may require additional 
supporting information, but only to the extent necessary to determine 
whether the price(s) offered is fair and reasonable.
    (4) By submission of an offer in response to this solicitation, the 
Offeror grants the Contracting Officer or an authorized representative 
the right to examine, at any time before initial award, books, records, 
documents, papers, and other directly pertinent records to verify the 
pricing, sales and other data related to the supplies or services 
proposed in order to determine the reasonableness of price(s). Access 
does not extend to Offeror's cost or profit information of other data 
relevant solely to the Offeror's determination of the prices to be 
offered in the catalog or marketplace.
    (b) Insert the following format for commercial sales practices in 
the exhibits or attachments section of the solicitation and resulting 
contract (see FAR 12.303).

                    Commercial Sales Practices Format

Name of Offeror ---------- SIN(s) ------

    Note: Please refer to Clause 552.212-70, Preparation of Offer 
(Multiple Award Schedule), for additional information concerning your 
offer. Provide the following information for each SIN (or group of SINs 
or SubSIN for which information is the same).

    (1) Provide the dollar value of sales to the general public at or 
based on an established catalog or market price during the previous 12-
month period or the offerors last fiscal year: $--------. State 
beginning and ending of the 12 month period. Beginning -------- ending 
--------. In the event that a dollar value is not an appropriate measure 
of the sales, provide and describe your own measure of the sales of the 
item(s).
    (2) Show your total projected annual sales to the Government under 
this contract for the contract term, excluding options, for each SIN 
offered. If you currently hold a Federal Supply Schedule contract for 
the SIN the total projected annual sales should be based on your 
mostrecent 12 months of sales under that contract.

SIN ------------ $------------
SIN ------------ $------------
SIN ------------ $------------

    (3) Based on your written discounting policies (standard commercial 
sales practices in the event you do not have written discounting 
policies), are the discounts and any concessions which you offer the 
Government equal to or better than your best price (discount and 
concessions in any combination) offered to any customer acquiring the 
same items regardless of quantity or terms and conditions? YES---- NO--
-- (See definition of ``concession'' and ``discount'' in 552.212-70.)
    (4)(a) Based on your written discounting policies (standard 
commercial sales practices in the event you do not have written 
discounting policies), provide information as requested for each SIN (or 
group of SINs for which the information is the same) in accordance with 
the instructions at Figure 515.4, which is provided in this solicitation 
for your convenience. The information should be provided in the chart 
below or in an equivalent format developed by the offeror. Rows should 
be added to accommodate as many customers as required.

----------------------------------------------------------------------------------------------------------------
                                                      Column 3  Quantity/                          Column 5
       Column 1  Customer         Column 2  Discount        Volume        Column 4  FOB Term      Concessions
----------------------------------------------------------------------------------------------------------------
 
 
 
----------------------------------------------------------------------------------------------------------------

    (b) Do any deviations from your written policies or standard 
commercial sales practices disclosed in the above chart ever result in 
better discounts (lower prices) or concessions than indicated? YES-- 
NO--. If YES,

[[Page 193]]

explain deviations in accordance with the instructions at Figure 515.4, 
which is provided in this solicitation for your convenience.
    (5) If you are a dealer/reseller without significant sales to the 
general public, you should provide manufacturers' information required 
by paragraphs (1) through (4) above for each item/SINoffered, if the 
manufacturer's sales under any resulting contract are expected to exceed 
$500,000. You must also obtain written authorization from the 
manufacturer(s) for Government access, at any time before award or 
before agreeing to a modification, to the manufacturer's sales records 
for the purpose of verifying the information submitted by the 
manufacturer. The information is required in order to enable the 
Government to make a determination that the offered price is fair and 
reasonable. To expedite the review and processing of offers, you should 
advise the manufacturer(s) of this requirement. The contracting officer 
may require the information be submitted on electronic media with 
commercially available spreadsheet(s). The information may be provided 
by the manufacturer directly to the Government. If the manufacturer's 
item(s) is being offered by multiple dealers/resellers, only one copy of 
the requested information should be submitted to the Government. In 
addition, you must submit the following information along with a listing 
of contact information regarding each of the manufacturers whose 
products and/or services are included in the offer (include the 
manufacturer's name, address, the manufacturer's contact point, 
telephone number, and FAX number) for each model offered by SIN:
    (a) Manufacturer's Name.
    (b) Manufacturer's Part Number.
    (c) Dealer's/Reseller's Part Number.
    (d) Product Description.
    (e) Manufacturer's List Price.
    (f) Dealer's/Reseller's percentage discount from list price or net 
prices.

                             (End of format)

    (c) Include the instructions for completing the commercial sales 
practices format in Figure 515.4 in solicitations issued under the MAS 
program.

    Figure 515.4--Instructions for Commercial Sales Practices Format

    If you responded ``yes'' to question (3), on the Commercial Sales 
Practices Format in paragraph (b) of this section, complete the chart in 
question (4)(a) for the customer(s) who receive your best discount. If 
you responded ``no'', complete the chart in question (4)(a) showing your 
written policies or standard sales practices for all customers or 
customer categories to whom you sell at a price (discounts and 
concessions in combination) that is equal to or better than the price(s) 
offered to the Government under this solicitation or with which the 
Offeror has a current agreement to sell at a discount which equals or 
exceeds the discount(s) offered under this solicitation. Such agreement 
shall be in effect on the date the offer is submitted or contain an 
effective date during the proposed multiple award schedule contract 
period. If your offer is lower than your price to other customers or 
customers categories, you will be aligned with the customer or category 
of customer that receives your best price for purposes of the Price 
Reductions clause at 552.238-75. The Government expects you to provide 
information required by the format in accordance with these instructions 
that is, to the best of your knowledge and belief, current, accurate, 
and complete as of 14 calender days prior to its submission. You must 
also disclose any changes in your price list(s), discounts and/or 
discounting policies which occur after the offer is submitted, but 
before the close of negotiations. If your discount practices vary by 
model or product line, the discount information should be by model or 
product line as appropriate. You may limit the number of models or 
product lines reported to those which exceed 75% of actual historical 
Government sales (commercial sales may be substituted if Government 
sales are unavailable) value of the special item number (SIN).

   Column 1--Identify the Applicable Customer or Category of Customer

    A ``customer'' is any entity, except the Federal Government, which 
acquires supplies or services from the Offeror. The term customer 
includes, but is not limited to original equipment manufacturers, value 
added resellers, state and local Governments, distributors, educational 
institutions (an elementary, junior high, or degree granting school 
which maintains a regular faculty and established curriculum and an 
organized body of students), dealers, national accounts, and end users. 
In any instance where the Offeror is asked to disclose information for a 
customer, the Offeror may disclose information by category of customer 
if the Offeror's discount policies or practices are the same for all 
customers in the category. (Use a separate line for each customer or 
category of customer.)

                     Column 2--Identify the Discount

    The term ``discount'' is as defined in solicitation clause 552.212-
70, Preparation of Offer (Multiple Award Schedule). Indicate the best 
discount (based on your written discounting policies or standard 
commercial discounting practices if you do not have written discounting 
policies) at which you sell to the customer or category of customer 
identified in column 1, without regard to quantity; terms and conditions 
of the agreements under which the discounts are given; and

[[Page 194]]

whether the agreements are written or oral. Net prices or discounts off 
of other price lists should be expressed as percentage discounts from 
the price list which is the basis of your offer. If the discount 
disclosed is a combination of various discounts (prompt payment, 
quantity, etc.), the percentage should be broken out for each type of 
discount. If the price lists which are the basis of the discounts given 
to the customers identified in the chart are different than the price 
list submitted upon which your offer is based, identify the type or 
title and date of each price list. The contracting officer may require 
submission of these price lists. To expedite evaluation, offerors may 
provide these price lists at the time of submission.

           Column 3--Identify the Quantity or Volume of Sales

    Insert the minimum quantity or sales volume which the identified 
customer or category of customer must either purchase/order, per order 
or within a specified period, to earn a discount indicate the time 
period.

  Column 4--Indicate the FOB Delivery Term for Each Identified Customer

    See FAR 47.3 for an explanation of FOB delivery terms.

  Column 5--Indicate Concessions Regardless of Quantity Granted to the 
               Identified Customer or Category of Customer

    Concessions are defined in solicitation clause 552.12-70, 
Preparation of Offers (Multiple Award Schedule). If the space provided 
is inadequate, the disclosure should be made on a separate sheet by 
reference.
    If you respond ``yes'' to question 4(b) in the Commercial Sales 
Practices Format, provide an explanation of the circumstances under 
which you deviate from your written policies or standard commercial 
sales practices disclosed in the chart on the Commercial Sales Practices 
Format and explain how often they occur. Your explanation should include 
a discussion of situations that lead to deviations from standard 
practice, an explanation of how often they occur, and the controls you 
employ to assure the integrity of your pricing. Examples of typical 
deviations may include, but are not limited to, one time goodwill 
discounts to charity organizations or to compensate an otherwise 
disgruntled customer; a limited sale of obsolete or damaged goods; the 
sale of sample goods to a new customer, or the sales of prototype goods 
for testing purposes.
    If deviations from your written policies or standard commercial 
sales practices disclosed in the chart on the Commercial Sales Practices 
Format are so significant and/or frequent that the Contracting Officer 
cannot establish whether the price(s) offered is fair and reasonable, 
then you may be asked to provide additional information. The Contracting 
Officer may ask for information to demonstrate that you have made 
substantial sales of the item(s) in the commercial market consistent 
with the information reflected on the chart on the Commercial Sales 
Practices Format, a description of the conditions surrounding those 
sales deviations, or other information that may be necessary in order 
for the Contracting Officer to determine whether your offered price(s) 
is fair and reasonable. In cases where additional information is 
requested the Contracting Officer will target the request in order to 
limit the submission of data to that needed to establish the 
reasonableness of the offered price.

                             (End of figure)

    (d) Insert the clause at 552.215-72, Price Adjustment--Failure to 
Provide Accurate Information, in solicitations and contracts under the 
MAS program.
    (e) You should use Alternate IV of FAR 52.215-21, Requirements for 
Cost or Pricing Data or Information Other Than Cost or Pricing Data--
Modifications, to provide for submission of information other than cost 
or pricing data for MAS contracts. To provide for uniformity in requests 
under the MAS program, you should insert the following in paragraph (b) 
of the clause:
    (1) Information required by the clause at 552.243-72, Modifications 
(Multiple Award Schedule).
    (2) Any additional supporting information requested by the 
Contracting Officer. The Contracting Officer may require additional 
supporting information, but only to the extent necessary to determine 
whether the price(s) offered is fair and reasonable.
    (3) By submitting a request for modification, the Contractor grants 
the Contracting Officer or an authorized representative the right to 
examine, at any time before agreeing to a modification, books, record, 
documents, papers, and other directly pertinent records to verify the 
pricing, sales and other data related to the supplies or services 
proposed in order to determine the reasonableness of price(s). Access 
does not extent to Contractor's cost or profit information or other data 
related solely to the Contractor's determination of the prices to be 
offered in the catalog or marketplace.

[64 FR 37214, July 9, 1999, as amended at 65 FR 11247, Mar. 2, 2000]

[[Page 195]]



 Subpart 515.5_Preaward, Award, and Postaward Notifications, Protests, 
                              and Mistakes



515.506  Postaward debriefing of offerors.

    For purposes of determining the date of receipt of a request for a 
post award debriefing, GSA's hours of operation are 8:00 a.m. to 4:30 
p.m. Request received after 4:30 p.m. will be considered received the 
following business day.



                      Subpart 515.70_Use of Samples



515.7002  Procedures.

    (a) Unsolicited samples. The reference to FAR 14.404-2(d) in FAR 
14.202-4(g) does not apply.

    However, qualifications in the proposal that are at variance with 
the Government's requirements, constitute deficiencies. Resolve these as 
provided in FAR 15.306.

    (b) Solicitation requirements. (1) Use the clause at FR 52.214-20. 
The second sentence in paragraph (c) of the clause does not apply. 
Substitute a sentence substantially as follows:

    Failure of the bid samples to conform to all the required 
characteristics listed in the solicitation constitutes a deficiency in 
the proposal (see FAR 15.306).

    (2) In addition to listing subjective characteristics that you 
cannot adequately describe in the specification, you may list and 
evaluate objective characteristics. To include objective 
characteristics, you must determine that examination of such 
characteristics is essential to the acquisition of any acceptable 
product. Base your determination on past experience or other valid 
considerations.
    (c) FAR 52.215-1(c)(3) applies to samples received after the time 
set for receipt of offers.



PART 516_TYPES OF CONTRACTS--Table of Contents




                   Subpart 516.2_Fixed Price Contracts

Sec.
516.203-4 Contract clauses.

               Subpart 516.5_Indefinite-Delivery Contracts

516.506 Solicitation provisions and contract clauses.

   Subpart 516.6_Time-and-Materials, Labor-Hour, and Letter Contracts

516.603 Letter contracts.
516.603-3 Limitations.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37218, July 9, 1999, unless otherwise noted.



                   Subpart 516.2_Fixed Price Contracts



516.203-4  Contract clauses.

    (a) Multiple award schedules. Do not use FAR 52.216-2, 52.216-3, or 
52.216-4 in negotiated acquisitions based on discounts from established 
commercial catalogs or pricelists. Instead, use:
    (1) 552.216-70, Economic Price Adjustment--FSS Multiple Award 
Schedule Contracts, in a 1-year solicitation or contract.
    (2) 552.216-70 (Alternate I) in multiyear solicitations and 
contracts.
    (b) Stock or Special Order Program Contracts. In multiyear 
solicitations and contracts, after making the determination required by 
FAR 16.203-2, use 552.216-71, Economic Price Adjustment-Stock and 
Special Order Program Contract, or a clause prepared as authorized in 
paragraph (a)(2)(ii) of this subsection.
    (1) If the contract includes one or more options to extend the term 
of the contract, use the clause with its Alternate I or a clause 
substantially the same as 552.216-71 with its Alternate I suitably 
modified.
    (2) In a contract requiring a minimum adjustment before the price 
adjustment mechanism is effectuated, use the basic clause with Alternate 
II or with Alternate I and Alternative II.
    (3) If the Producer Price Index is not an appropriate indicator for 
price adjustment, modify the clause to use an alternate indicator for 
adjusting prices. Similarly, if other aspects of 552.216-71 are not 
appropriate, use an alternate clause following established procedures.
    (c) Adjustments based on cost indexes of labor or material. (1) If 
you decide to

[[Page 196]]

provide for adjustments based on cost indexes of labor or material, 
prepare a clause that defines each of the following elements:
    (i) The type of labor and/or material subject to adjustment.
    (ii) The labor rates, including any fringe benefits and/or unit 
prices of materials that may be increased or decreased.
    (iii) The index(es) that will be used to measure changes in price 
levels and the base period or reference point from which changes will be 
measured.
    (iv) The period during which the price(s) will be subject to 
adjustment.
    (2) The contracting director must approve use of this clause.



               Subpart 516.5_Indefinite-Delivery Contracts



516.506  Solicitation provisions and contract clauses.

    (a) In solicitations and contracts for stock or special order 
program items, when the contract authorizes FSS and other activities to 
issue delivery or task orders, insert the clause at 552.216-72, 
Placement of Orders. If only FSS will issue delivery or task orders, 
insert the clause with its Alternate I.
    (b) In solicitations and contracts for single or multiple award 
schedule program items, insert the clause at 552.216-72, Placement of 
Orders, with its Alternate II.
    (c) Use 552.216-72, Placement of Orders, Alternate III, instead of 
Alternate II in solicitations and contracts for--
    (1) Federal Supply Schedule 70;
    (2) The Consolidated Schedule containing information technology 
Special Item Numbers; and
    (3) Federal Supply Schedule 84.
    (d) In solicitations and contracts for Federal Supply Schedules for 
recovery purchasing (See 538.7102), use 552.216-72, Placement of Orders, 
Alternate IV, instead of Alternate II.
    (e) If the clause at 552.216-72 is prescribed, insert the provision 
at 552.216-73, Ordering Information, in solicitations for stock items 
and in other FSS solicitations. Use 552.216-73 Alternate I when 552.216-
72 Alternate I is prescribed. Use 552.216-73 Alternate II when 552.216-
72 Alternate II, Alternate III, or Alternate IV are prescribed.

[64 FR 37218, July 9, 1999, as amended at 68 FR 24378, May 7, 2003; 69 
FR 28065, May 18, 2004; 72 FR 4652, Feb. 1, 2007; 73 FR 54338, Sept. 19, 
2008]



   Subpart 516.6_Time-and-Materials, Labor-Hour, and Letter Contracts



516.603  Letter contracts.



516.603-3  Limitations.

                    Architect-Engineer (A-E) Services

    (a) Requirement for a price proposal. Before you award a letter 
contract, the proposed A-E must provide a price proposal for the non-
design effort.
    (b) Contents of each letter contract. You must include the following 
information in the letter contract:
    (1) The scope. If you include the design effort, only authorize the 
A-E to perform those services that are independent of the design effort 
(for example, feasibility studies, existing facility surveys or site 
investigation, etc.). Do not authorize the A-E to begin the design 
effort before the letter contract is definitized.
    (2) A definitization schedule. Include dates for each of the 
following:
    (i) Submission of the design fee proposal.
    (ii) Start of negotiations.
    (iii) Definitization. This date must be no later than 90 days after 
the date of the letter contract.
    (3) A limitation on the Government's liability for the non-design 
effort to be performed under the contract. Insert this amount in FAR 
52.216-24, Limitation of Government Liability.
    (c) Unilateral price decision. If you must issue a unilateral price 
decision, the maximum contract amount must not exceed a reasonable price 
for the excludable items plus the 6 percent statutory fee limitation for 
the project.

[[Page 197]]



PART 517_SPECIAL CONTRACTING METHODS--Table of Contents




                   Subpart 517.1_Multiyear Contracting

Sec.
517.109 Contract clauses.

                          Subpart 517.2_Options

17.200 Scope of subpart.
17.202 Use of options.
17.203 Solicitations.
17.207 Exercise of options.
17.208 Solicitation provisions and contract clauses.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37218, July 9, 1999, unless otherwise noted.



                   Subpart 517.1_Multiyear Contracting



517.109  Contract clauses.

    Use of FAR 52.217-2, Cancellation Under Multi-year Contracts, is 
optional in multiyear contracts authorized by 40 U.S.C. 490(a)(14) for 
maintenance and repair of fixed equipment in federally-owned buildings 
and services and 40 U.S.C. 481(a)(3) for public utility services.



                          Subpart 517.2_Options



517.200  Scope of subpart.

    (a) This subpart applies to all GSA contracts for supplies and 
services, including:
    (1) Services involving construction, alteration, or repair 
(including dredging, excavating, and painting) of buildings, bridges, 
roads, or other kinds of real property.
    (2) Architect-engineer services.
    (b) If a requirement in this subpart is inconsistent with FAR 17.2, 
this subpart takes precedence.



517.202  Use of options.

    (a) Supplies or services. (1) You should use options when they meet 
one or more of the following objectives:
    (i) Reduce procurement lead time and associated costs.
    (ii) Ensure continuity of contract support.
    (iii) Improve overall contractor performance.
    (iv) Facilitate longer term contractual relationships with those 
contractors that continually meet or exceed quality performance 
expectations.
    (2) An option is normally in the Government's interest in the 
following circumstances:
    (i) You anticipate a need for additional supplies or services during 
the contract term.
    (ii) Multiyear contracting authority is not available or its use is 
inappropriate and you anticipate a need for additional supplies or 
services beyond the initial contract term.
    (iii) There is a need for continuity of supply or service support.
    (iv) Funds are not available for the entirety of the Government's 
needs, but are likely to become available during the contract term.
    (v) The initial contract will be used to evaluate the performance of 
an emerging small business.
    (3) Do not use an option if the market price is likely to change 
substantially and an economic price adjustment clause inadequately 
protects the Government's interest.
    (b) Construction. For limitations on the use of options, see 536.213 
and 536.270.



517.203  Solicitations.

    A solicitation that includes an option to extend should inform 
offerors that the contract could result in a long term contractual 
relationship subject to both of the following conditions:
    (a) Continuing need by GSA.
    (b) Level of contract performance that at least meets GSA's quality 
performance expectations.



517.207  Exercise of options.

    Before exercising an option, you must:
    (a) Synopsize it unless you meet of the following conditions:
    (1) The option was evaluated as part of the original competition.
    (2) The contract action meets an exception in FAR 5.202.
    (b) Conclude that the contractor's performance under the contract 
met or exceeded the Government's expectation for quality performance, 
unless another circumstance justifies an extended contractual 
relationship.

[[Page 198]]

    (c) Determine that the option price is fair and reasonable.



517.208  Solicitation provisions and contract clauses.

    (a) For solicitations under FSS's Stock or Special Order Program, 
insert a provision substantially the same as the provision at 552.217-
70, Evaluation of Options, if both of the following conditions apply:
    (1) The solicitation contains an option to extend the term of the 
contract.
    (2) The contract will be fixed price and contain an economic price 
adjustment clause.
    (b) Insert the provision at 552.217-71, Notice Regarding Option(s), 
or a similar provision, in solicitations that include an option for 
increased quantities of supplies or services or an option to extend.

[[Page 199]]



                   SUBCHAPTER D_SOCIOECONOMIC PROGRAMS





PART 519_SMALL BUSINESS PROGRAMS--Table of Contents




               Subpart 519.5_Set-Asides for Small Business

Sec.
519.508 Soliciation provisions for contract clauses.

         Subpart 519.7_The Small Business Subcontracting Program

519.708 Contract clauses.
519.708-70 Solicitation provisions.

 Subpart 519.8_Contracting With the Small Business Administration (The 
                              8(a) Program)

519.870 Direct 8(a) contracting.
519.870-8 Contract clauses.

    Subpart 519.12_Small Disadvantaged Business Participation Program

519.1202 Evaluation factor or subfactor.
519.1202-2 Applicability.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37219, July 9, 1999, unless otherwise noted.



               Subpart 519.5_Set-Asides for Small Business



519.508  Solicitation provisions for contract clauses.

    Insert 552.219-70, Allocation of Orders--Partially Set-Asides Items, 
in solicitations and requirements type supply contracts that are 
partially set aside for small business.



         Subpart 519.7_The Small Business Subcontracting Program



519.708  Contract clauses.



519.708-70  Solicitation provisions.

    Insert the following provisions as directed:
    (a) 552.219-71, Notice to Offerors of Subcontracting Plan 
Requirements, on the cover page of solicitations containing the clause 
at FAR 52.219-9, Small Business Subcontracting Plan.
    (b) 552.219-72, Preparation, Submission, and Negotiations of 
Subcontracting Plans, in solicitations requiring submission of the 
subcontracting plan with initial offers.
    (c) 552.219-73, Goals for Subcontracting Plan as follows:
    (1) Use the basic provision in sealed bid solicitations containing 
FAR 52.219-9 if you are able to establish realistic target goals.
    (2) Use Alternate I in:
    (i) sealed bid solicitations if you cannot establish target goals.
    (ii) Negotiated solicitations that include FAR 52.219-9, but do not 
include 552.219-72.



 Subpart 519.8_Contracting With the Small Business Administration (The 
                              8(a) Program)



519.870  Direct 8(a) contracting.



519.870-8  Contract clauses.

    (a) Insert the following clauses in solicitations, contracts, and 
orders issued under the MOU:
    (1) Insert the clause at 552.219-74, Section 8(a) Direct Award.
    (2) Insert the clause at FAR 52.219-14, Limitation on 
Subcontracting.
    (3) Insert the clause at FAR 52.219-18, Notification of Competition 
Limited to Eligible 8(a) Concerns, Substitute the following paragraph 
for paragraph (c) of the clause. Add the word ``Deviation'' at the end 
of the clause title.

    (c) Any award resulting from this solicitation will be made directly 
by the Contracting Officer to the successful 8(a) offeror selected 
through the evaluation criteria set forth in this solicitation.

    (b) Do not use the clauses at FAR 52.219-11, Special 8(a) Contract 
Conditions, FAR 52.219-12, Special 8(a) Subcontract Conditions, or FAR 
52.219-17, Section 8(a) Award.

[[Page 200]]



    Subpart 519.12_Small Disadvantaged Business Participation Program



519.1202  Evaluation factor or subfactor.



519.1202-2  Applicability.

    In addition to the exception in FAR 19.1202-2, do not evaluate the 
extent of participation of SDB concerns in performance of multiple award 
schedule contracts when all fair and reasonable offers from responsible 
sources are accepted.



PART 522_APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS--Table of Contents




Sec.
522.001 Defintion.

                   Subpart 522.1_Basic Labor Policies

522.101 Labor relations.
522.101-1 General.
522.103-5 Contract clauses.

   Subpart 522.4_Labor Standards for Contracts Involving Construction

522.406 Administration and enforcement.
522.406-6 Payrolls and statements.

               Subpart 522.8_Equal Employment Opportunity

522.803 Responsibilities.
522.804 Affirmative action programs.
522.804-1 Nonconstruction.
522.804-2 Construction.
522.805 Procedures.
522.807 Exemptions.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37220, July 9, 1999, unless otherwise noted.



522.001  Definition.

    Agency labor advisor, as used in this part, means the Director of 
the Contract Policy Division (VPC) within the Office of the Chief 
Acquisition Officer (OCAO).

[73 FR 46203, Aug. 8, 2008]



                   Subpart 522.1_Basic Labor Policies



522.101  Labor relations.



522.101-1  General.

    The Office of General Counsel (OGC) and the agency labor advisor 
shall--
    (a) Serve as the GSA points of contact on all contractor labor 
relations matters;
    (b) Initiate contact on contractor labor relations matters with 
national offices of labor organizations, Government departments, 
agencies or other governmental organizations. Contracting offices shall 
notify OGC and the agency labor advisor when they are contacted by such 
external organizations;
    (c) Serve as a clearinghouse for information on labor laws 
applicable to Government acquisitions; and
    (d) Respond to questions involving FAR Part 22, Application of Labor 
Laws to Government Acquisitions, or other contractor labor relations 
matters concerning GSA acquisition programs. OGC determines the agency's 
legal position.

[73 FR 46203, Aug. 8, 2008]



522.103-5  Contract clauses.

    Insert FAR 52.222-1, Notice to the Government of Labor Disputes, in 
solicitations and contracts for DX rated orders under the Defense 
Priorities and Allocations System (DPAS). Information on the DPAS can be 
found at FAR Subpart 11.6, Priorities and Allocations.

[73 FR 46203, Aug. 8, 2008]



   Subpart 522.4_Labor Standards for Contracts Involving Construction



522.406  Administration and enforcement.



522.406-6  Payrolls and statements.

    Weekly payrolls and statements of compliance with respect to payment 
of wages are not required from a prime contractor or a subcontractor 
that personally performs work.

[73 FR 46203, Aug. 8, 2008]

[[Page 201]]



               Subpart 522.8_Equal Employment Opportunity



522.803  Responsibilities.

    Contracting officers should submit questions on the applicability of 
E.O. 11246 and implementing regulations to assigned legal counsel.

[64 FR 37220, July 9, 1999, as amended at 73 FR 46203, Aug. 8, 2008]



522.804  Affirmative action programs.



522.804-1  Nonconstruction.

    (a) The requirements of FAR 22.804 also apply to each contractor and 
subcontractor with 50 or more employees that either:
    (1) Serves as a depository of Government funds; or
    (2) Is a financial institution serving as an issuing and paying 
agent for U.S. savings bonds and savings notes.
    (b) The contractors, subcontractors, and financial institutions 
described in 522.804-1(a) must develop a written affirmative action 
compliance program for each of its establishments regardless of the 
contract or holding value, in accordance with 41 CFR 60-1.40.

[64 FR 37220, July 9, 1999, as amended at 73 FR 46203, Aug. 8, 2008]



522.804-2  Construction.

    Goals for the employment of minorities and women in the construction 
industry are established by the Director, Office of Federal Contract 
Compliance Programs (OFCCP), Department of Labor. The current goal for 
the utilization of women is 6.9%, regardless of the location of the 
Federal contract. This goal was extended indefinitely by the Department 
of Labor in 1980. The current goals for minority participation vary by 
location and are listed in Appendix E of DOL's ``Technical Assistance 
Guide for Federal Construction Contractors.'' This guide can be accessed 
at http://www.dol.gov/esa/ofccp/TAguides/ctaguide.htm.

[73 FR 46203, Aug. 8, 2008]



522.805  Procedures.

    (a) To determine whether the contract meets the threshold in FAR 
22.805(a), contracting officers shall include the value of the basic 
contract plus priced options. A contract modification exercising a 
priced option is not a contract award under FAR 22.805(a)(1)(ii) and 
does not a require a preaward clearance.
    (b) Contracting officers shall submit preaward clearance requests 
directly to the appropriate OFCCP regional office. A list of these 
offices can be found at http://www.dol.gov/esa/contacts/ofccp/
ofcpkeyp.htm.
    (c) The EEO poster required by FAR 22.805(b) can be found at: http:/
/www.dol.gov/esa/regs/compliance/posters/pdf/eeopost.pdf. In addition to 
providing this poster to each non-exempt contractor, the contracting 
officer shall advise contractors to complete the Employer Information 
Report (EEO-1) at http://www.eeoc.gov/eeo1survey/index.html.

[64 FR 37220, July 9, 1999, as amended at 73 FR 46203, Aug. 8, 2008]



522.807  Exemptions.

    The agency labor advisor submits a request for exemption.



PART 523_ENVIRONMENT, CONSERVATION, OCCUPATIONAL SAFETY AND DRUG-FREE WORKPLACE--Table of Contents




  Subpart 523.3_Hazardous Materials Identification and Material Safety 
                                  Data

Sec.
523.303 Contract clause.
523.370 Solicitation provision.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37220, July 9, 1999, unless otherwise noted.



  Subpart 523.3_Hazardous Materials Identification and Material Safety 
                                  Data



523.303  Contract clause.

    (a) Insert 552.223-70, Hazardous Substances, in solicitations and 
contracts for packaged items subject to the Federal Hazardous Substances 
Act and the Hazardous Materials Transportation Act.
    (b) Insert 552.223-71, Nonconforming Hazardous Materials, in 
solicitations and contracts for supplies that contain hazardous 
materials.

[[Page 202]]



523.370  Solicitation provision.

    Insert 552.223-72, Hazardous Material Information, in any 
solicitation that provides for delivery of hazardous materials on an 
f.o.b. origin basis.



PART 525_FOREIGN ACQUISITION--Table of Contents




Subpart 525.1--Buy American Act-Supplies [Reserved]

                Subpart 525.3_Balance of Payments Program

Sec.
525.302 Policy.
525.302-70 Procurements for agencies under the Foreign Assistance Act.

       Subpart 525.5_Evaluating Foreign Officers_Supply Contracts

525.570 Procurement of hand or measuring tools or stainless steel 
          flatware for DOD.

       Subpart 525.11_Solicitation Provisions and Contract Clauses

525.1101 Acquisition of supplies.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37221, July 9, 1999, unless otherwise noted.

Subpart 525.1--Buy American Act-Supplies [Reserved]



                Subpart 525.3_Balance of Payments Program



525.302  Policy.



525.302-70  Procurements for agencies under the Foreign Assistance Act.

    GSA procurements made directly for other agencies of items to be 
used outside the United States are made the Balance of Payments Program. 
The only exception is if GSA contracts as the agent for an agency 
governed by the Foreign Assistance Act (22 U.S.C. 2151 et seq.). If this 
exception applies, the contract will be governed by the policies and 
procedures of the agency instead of FAR 25.3 and 525.3. For example, GSA 
sometimes acts as agent for the Agency for International Development and 
the Bureau of International Narcotics Matters.



       Subpart 525.5_Evaluating Foreign Officers_Supply Contracts



525.570  Procurement of hand or measuring tools or stainless steel flatware for DOD.

    (a) Stainless steel flatware means special order and stock items of 
stainless steel flatware purchased for DOD, including, but not limited 
to, the following National Stock Numbers (NSN):

7340-00-060-6057
7340-00-205-3340
7340-00-241-8171
7340-00-559-8357
7340-00-205-3341
7340-00-241-8169
7340-00-241-8170
7340-00-688-1055
7340-00-721-6316
7340-00-721-6971

    (b) Purchases of hand or measuring tools or stainless steel flatware 
exceeding the simplified acquisition threshold by DOD must be domestic 
end products. In the case of stainless steel flatware, the Secretary of 
the Department concerned can make an exception. The individual must 
determine that a satisfactory quality and sufficient quantity produced 
in the United States or its possessions are not available when needed at 
domestic market prices.
    (c) If GSA solicitations of hand or measuring tools or stainless 
steel flatware include DOD requirements, GSA will apply the DOD 
restrictions. The bases for applying the DOD restriction to GSA 
acquisitions are:
    (1) DOD's restrictions apply to requisitions of such items from the 
GSA stock program.
    (2) The impracticality of establishing a dual supply system to 
satisfy the requirements of civilian and military agencies.
    (3) GSA may reject any offer when it is considered necessary for 
reasons of national interest.

[65 FR 41379, July 5, 2000]



       Subpart 525.11_Solicitation Provisions and Contract Clauses



525.1101  Acquisition of supplies.

    If you include DOD requirements for hand or measuring tools or 
stainless steel flatware in the solicitation for an

[[Page 203]]

acquisition estimated to exceed the simplified acquisition threshold, 
insert 552.225-70, Notice of Procurement Restriction--Hand or Measuring 
Tools or Stainless Steel Flatware, in the solicitation and resulting 
contract(s).

[65 FR 41379, July 5, 2000]

[[Page 204]]



              SUBCHAPTER E_GENERAL CONTRACTING REQUIREMENTS





PART 527_PATENTS, DATA, AND COPYRIGHTS--Table of Contents




    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37221, July 9, 1999, unless otherwise noted.



               Subpart 527.4_Rights in Data and Copyrights



527.409  Solicitation provisions and contract clauses.

    Architect-Engineer Services and Construction Contracts Involving 
                       Architect-Engineer Services

    Insert the following in solicitations and contracts for architect-
engineer services and construction contracts involving architect-
engineer services:
    (a) Insert 552.227-70, Government Rights (Unlimited), instead of FAR 
52.227-17, Rights in Data-Special Works, in contracts, except if 
552.227-71 is prescribed.
    (b) If the Government requires sole property rights and exclusive 
control over the design and data, insert 552.227-71, Drawings and Other 
Data to Become Property of Government, instead of FAR 52.227-17.



PART 528_BONDS AND INSURANCE--Table of Contents




           Subpart 528.2_Sureties and Other Security for Bonds

Sec.
528.202 Acceptability of corporate sureties.

                         Subpart 528.3_Insurance

528.310 Contract clause for work on a Government installation.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37221, July 9, 1999, unless otherwise noted.



           Subpart 528.2_Sureties and Other Security for Bonds



528.202  Acceptability of corporate sureties.

    Corporate surety bonds must be manually signed by the Attorney-in-
Fact or officer of the surety company and the corporate seal affixed. 
You may waive failure of the surety to affix the corporate seal as a 
minor informality. (See B-184120, July 2, 1975, 75-2 CPD 9.)



                         Subpart 528.3_Insurance



528.310  Contract clause for work on a Government installation.

    (a) Insert the clause at 552.228-70, Workers' Compensation Laws, in 
each solicitation and contract that meets all the following conditions:
    (1) The contract amount is expected to exceed the simplified 
acquisition threshold.
    (2) The contract will require work to be performed on Government 
property.
    (b) In the case of an owner-controlled insurance program, or wrap-up 
insurance, the clause will be a part of the policy holder's 
requirements.



PART 529_TAXES--Table of Contents




                     Subpart 529.4_Contract Clauses

Sec.
529.401 Domestic contracts.
529.401-70 Purchases at or under the simplified acquisition threshold.
529.401-71 Contracts for supplies and services usable by the DC 
          Government.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37222, July 9, 1999, unless otherwise noted.

[[Page 205]]



                     Subpart 529.4_Contract Clauses



529.401  Domestic contracts.



529.401-70  Purchases at or under the simplified acquisition threshold.

    Insert 552.229-70, Federal, State, and Local Taxes, in purchases and 
contracts estimated to exceed the micropurchase threshold, but not the 
simplified acquisition threshold.



529.401-71  Contracts for supplies and services usable by the DC Government.

    Insert 552.229-71, Federal Tax-DC Government, in solicitations and 
contracts that permit the District of Columbia Government to place 
orders.



PART 532_CONTRACT FINANCING--Table of Contents




          Subpart 532.1_Non-Commercial Item Purchase Financing

Sec.
532.111 Contract clauses for non-commercial purchases.

            Subpart 532.2_Commercial Item Purchase Financing

532.206 Solicitation provisions and contract clauses.

                     Subpart 532.7_Contract Funding

532.705 Contract clauses.
532.705-1 Clauses for contracting in advance of funds.

                   Subpart 532.8_Assignment of Claims

532.806 Contract clauses.

                      Subpart 532.9_Prompt Payment

532.902 Definitions.
532-905 Invoice payments.
532.905-70 Certification of payment to subcontractors and suppliers 
          under fixed-price construction contracts.
532.905-71 Final payment--construction and building service contracts.
532.908 Contract clauses.

Subpart 532.70_Authorizing Payment by Governmentwide Commercial Purchase 
                                  Card

532.7001 Definition.
532.7002 Solicitation requirements.
532.7003 Contract clause.

             Subpart 532.71_Payments for Recurring Services

532.7101 Definitions.
532.7102 Applicability.
532.7104 Contract clauses.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37222, July 9, 1999, unless otherwise noted.



          Subpart 532.1_Non-Commercial Item Purchase Financing



532.111  Contract clauses for non-commercial purchases.

    (a) Invoice requirements. Insert 552.232-70, Invoice Requirements, 
or something substantially the same, in all solicitations and contracts 
for supplies, services, construction, architect-engineer services, or 
the acquisition of leasehold interests in real property that require the 
submission of invoices for payment. Delete subparagraph (b) of the 
clause if an Accounting Control Transaction (ACT) number is not required 
for payment.
    (b) Adjusting payments. Insert 552.232-71, Adjusting Payments, in 
all solicitations and contracts for recurring building services expected 
to exceed the simplified acquisition threshold.
    (c) Final payment. Insert 552.232-72, Final Payment, in all 
solicitations and contracts for recurring building services expected to 
exceed the simplified acquisition threshold.



            Subpart 532.2_Commercial Item Purchase Financing



532.206  Solicitation provisions and contract clauses.

    (a) Discounts for prompt payment. Include 552.232-8, Discounts for 
Prompt Payments, in multiple award schedule solicitations and contracts 
instead of the clause at Federal Acquisition Regulation 52.232-8. Use 
Alternate I in solicitations and contracts for--
    (1) Federal Supply Schedule 70;
    (2) The Consolidated Schedule containing information technology 
Special Item Numbers (SINs); or
    (3) Federal Supply Schedule 84; and
    (4) Federal Supply Schedules for recovery purchasing (see 538.7102).
    (b) The contracting officer shall insert the clause at 552.232-81, 
Payments

[[Page 206]]

by Non-Federal Ordering Activities, in solicitations and schedule 
contracts for--
    (1) Federal Supply Schedule 70;
    (2) The Consolidated Schedule contracts containing information 
technology SINs;
    (3) FSS Schedule 84; and
    (4) Federal Supply Schedules for recovery purchasing (see 538.7102).
    (c) The contracting officer shall insert the provision at 552.232-
82, Contractor's Remittance (Payment) Address, in all Federal Supply 
Schedule solicitations and contracts.
    (d) The contracting officer shall insert the clause at 552.232-83, 
Contractor's Billing Responsibilities, in all Multiple Award Schedule 
solicitations and contracts.

[68 FR 24378, May 7, 2003, as amended at 69 FR 28065, May 18, 2004; 72 
FR 4652, Feb. 1, 2007; 73 FR 54338, Sept. 19, 2008]



                     Subpart 532.7_Contract Funding



532.705  Contract clauses.



532.705-1  Clauses for contracting in advance of funds.

    Insert 552.232-73, Availability of Funds, in solicitations and 
contracts for services which are ``severable'' when both of the 
following conditions apply:
    (a) The contract, or a portion of the contract, will be chargeable 
to funds of the new fiscal year.
    (b) The circumstances described in the prescriptions for FAR 52.232-
18 or 52.232-19 do not apply.



                   Subpart 532.8_Assignment of Claims



532.806  Contract clauses.

    Insert the clause at 552.232-23, Assignment of Claims, in 
solicitations and requirements or indefinite quantity contracts under 
which more than one agency may place orders.



                      Subpart 532.9_Prompt Payment



532.902  Definitions.

    Full cycle electronic commerce means the use of electronic data 
interchange (EDI), Internet-based invoice processing, and electronic 
funds transfer (EFT):
    (a) By the Government, to place purchase, delivery, or task orders, 
receive invoices, and pay invoices.
    (b) By the Contractor, to accept and fill orders, submit invoices, 
and receive payment.



532.905  Invoice payments.

    (a) General and architect-engineer contracts. Before exercising the 
authority to modify the date for constructive acceptance or constructive 
approval of progress payments in the clauses listed in this section, you 
must prepare a written justification explaining why a longer period is 
necessary. An official one level above you must approve your 
justification. Determine the time needed on a case-by-case basis.
    (1) In subdivision (a)(6)(i) of the clause at FAR 52.232-25, Prompt 
Payment, do not specify a constructive acceptance period that exceeds 30 
days.
    (2) In subdivision (a)(4)(i)(A) of the clause at FAR 52.232-26, 
Prompt Payment for Fixed-Price Architect-Engineer Contracts, do not 
specify a constructive acceptance period that exceeds 30 days.
    (3) In subdivision (a)(4)(i)(B) of the clause at FAR 52.232-26, 
Prompt Payment for Fixed-Price Architect-Engineer Contracts, do not 
specify a period for constructive approval of progress payments that 
exceeds 7 days.
    (b) Construction contracts. (1) Determine on a case-by-case basis 
the time specified for payment of progress payments in subdivision 
(a)(1)(i)(A) of the clause at FAR 52.232-27, Prompt Payment for 
Construction Contracts. Justify in writing periods longer than 14 days. 
An official one level above you must approve your justification. Under 
no circumstances may more than 30 days be specified.
    (2) Determine the time to be specified in subdivision (a)(4)(i) of 
FAR clause 52.232-27, for constructive acceptance or approval, on a 
case-by-case basis. This time may not exceed 7 days unless you justify a 
longer period in writing, and obtain the approval of an official one 
level above you. Under no circumstances may more than 30 days be 
specified.

[[Page 207]]

    (c) Federal Supply Service. (1) To increase efficiency and reduce 
costs to the Government, Federal Supply Service contracts under the 
Stock, Special Order, and Schedules Programs may authorize payment 
within 10 days of receipt of a proper invoice. The contract must meet 
all the following conditions:
    (i) The contractor agrees to full cycle electronic commerce.
    (ii) The contract includes FAR 52.232-33, Mandatory Information for 
Electronic Funds Transfer Payment.
    (2) The 10 day payment terms apply to each order that meets all the 
following conditions:
    (i) FSS places the order using EDI in accordance with the Trading 
Partner Agreement.
    (ii) The contractor submits EDI invoices in accordance with the 
Trading Partner Agreement or invoices through the GSA Finance Center 
Internet-based invoice process.
    (iii) A GSA Finance Center pays the invoices using EFT.
    (3) The 10 day payment terms do not apply to any order:
    (i) Placed by a GSA contracting activity other than FSS.
    (ii) Placed by or paid by another agency.



532.905-70  Certification of payment to subcontractors and suppliers under fixed-price construction contracts.

    The contractor may use GSA Form 2419, Certification of Progress 
Payments Under Fixed-Price Construction Contracts, for the certification 
required by FAR 52.232-5.



532.905-71  Final payment--construction and building service contracts.

    The following procedures apply to construction and building service 
contracts.
    (a) Do not process the final payment on construction or building 
service contracts until the contractor submits a properly executed GSA 
Form 1142, Release of Claims. If, after repeated attempts, you are 
unable to obtain a release of claims from the contractor, you may 
process the final payment with the approval of assigned legal counsel.
    (b) The amount of final payment must include, as appropriate, 
deductions to cover any of the following:
    (1) Liquidated damages for late completion.
    (2) Liquidated damages for labor violations.
    (3) Amounts withheld for improper payment of labor wages.
    (4) The amount of unilateral change orders covering defects and 
omissions.



532.908  Contract clauses.

    (a) Federal Supply Service. For FSS Stock, Special Order, and 
Schedules solicitations and contracts that provide payment in 10 days 
under 532.905(c):
    (1) If the contract will include FAR 52.212-4 insert the clause at 
552.232-74, Invoice Payments. GSA received a class deviation to allow 
use of 552.232-74 for commercial items.
    (2) If the contract will not include FAR 52.212-4, insert 552.232-
25, Prompt Payment, instead of FAR 552.232-25.
    (b) Leasehold Interests in Real Property. (1) Insert 552.232-75, 
Prompt Payment, in solicitations and contracts for acquiring leasehold 
interests in real property.
    (i) You may modify the date for constructive acceptance in 
subparagraph (b)(2) of the clause to specify a period longer than 7 
calendar days (but not to exceed 30 days) if necessary because of the 
nature of the services to be received, inspected or accepted by the 
Government. Prepare a written justification for specifying the longer 
period and obtain your contracting director's approval.
    (ii) Use Alternate I if the lease contract does not contain 
provisions for ordering alterations or overtime utility services.
    (2) Insert 552.232-76, Electronic Funds Transfer Payment, in 
solicitations and contracts for acquisition of leasehold interests in 
real property.
    (c) Solicitations, purchase orders, contracts, and leases over the 
micropurchase theshold. Insert 552.232-78, Payment information:
    (1) In all solicitations, purchase orders, and contracts, including 
acquisitions of leasehold interests in real property.

[[Page 208]]

    (2) In task and delivery orders if the contract that the order is 
placed against does not include the clause.

[64 FR 37222, July 9, 1999, as amended at 65 FR 41379, July 5, 2000]



Subpart 532.70_Authorizing Payment by Governmentwide Commercial Purchase 
                                  Card



532.7001  Definition.

    Governmentwide commercial purchase card has the same meaning as in 
FAR 13.101.



532.7002  Solicitation requirements.

    (a) In solicitations for supplies and services, except FSS schedule 
solicitations, request offerors to indicate if they will accept payment 
by Governmentwide commercial purchase card. Identify the card brand(s) 
under the GSA SmartPay program that may be used to make payments under 
the contract, on the cover page or in Section L of the solicitation.
    (b) For FSS schedule contracts, identify the card brand(s) under the 
GSA SmartPay program that may be used to make payments under the 
contract in the contract award letter.
    (c) For orders placed by GSA, you may authorize payment by 
Governmentwide commercial purchase card only for orders that do not 
exceed $100,000 (see GSA Order, Guidance on Use of the Credit Card for 
Purchases (CFO 4200.1)).
    (d) Consider requesting offerors to designate different levels for 
which they may accept payment by Governmentwide commercial purchase 
card, for example:

    ``If awarded a contract under this solicitation, the offeror agrees 
to accept payment by Governmentwide commercial purchase card for orders 
of:

--$2,500 or less
--$25,000 or less
--$50,000 or less
--$100,000 or less''

[65 FR 11247, Mar. 2, 2000]



532.7003  Contract clause.

    (a) Indefinite-delivery, indefinite-quantity (IDIQ) contracts other 
than Federal Supply Service. Insert the clause at 552.232-77, Payment by 
Governmentwide Commercial Purchase Card, in IDIQ solicitations and 
contracts for supplies and services if the contract will provide for 
payment by Governmentwide commercial purchase card as an alternative 
method of payment for orders.
    (b)Federal Supply Service contracts. Use Alternate I of the clause 
at 552.232-77 for all Federal Supply Schedule solicitations and 
contracts, except for--
    (1) Federal Supply Schedule 70, Information Technology;
    (2) The Consolidated Schedule contracts containing information 
technology Special Item Numbers;
    (3) Federal Supply Schedule 84; and
    (4) Federal Supply Schedule contracts for recovery purchasing (see 
538.7102).
    (c) Use 552.232-79 instead of 552.232-77 in solicitations and 
contracts for--
    (1) Federal Supply Schedule 70;
    (2) The Consolidated Schedule containing information technology 
Special Item Numbers;
    (3) Federal Supply Schedule 84; and
    (4) Federal Supply Schedule contracts for recovery purchasing (see 
538.7102).

[65 FR 11247, Mar. 2, 2000, as amended at 68 FR 24378, May 7, 2003; 69 
FR 28065, May 18, 2004; 72 FR 4652, Feb. 1, 2007; 73 FR 54338, Sept. 19, 
2008]



             Subpart 532.71_Payments for Recurring Services



532.7101  Definitions.

    Fixed roll payment means automatic payment of fixed amounts at 
regular intervals without submission of an invoice or receiving report.



532.7102  Applicability.

    You may use fixed roll payments in any contract that meets all four 
of the following conditions:
    (a) The contract provides for recurring services at a constant level 
for a period of at least two months.
    (b) The contract does not contain any discount items.
    (c) Payment is due 30 days following completion of the service 
month.
    (d) For a commercial item acquisition, fixed roll payments are 
consistent with customary commercial practice.

[[Page 209]]



532.7104  Contract clauses.

    (a) Noncommercial item acquisitions. For solicitations and contracts 
to be paid by fixed roll payment, include the clause at 552.232-1, 
Payments. Do not include the clauses at FAR 52.232-1, Payments, or 
552,232-70, Invoice Requirements.
    (b) Commercial item acquisitions. For solicitations and contracts to 
be paid by fixed roll payment, tailor the clause at FAR 52.212-4 by an 
addendum as noted in paragraphs (b) (1) and (2) of this section. This 
tailoring is authorized by a deviation approved on January 5, 1999.
    (1) Delete paragraph FAR 52.212-4(g), Invoice.
    (2) Add the following to paragraph FAR 52.212-4(i), Payment:

    The Government shall pay the Contractor, without submission of 
invoices or vouchers, 30 days after the service period, the prices 
stipulated in this contract for services rendered and accepted, less any 
deductions provided in this contract.



PART 533_PROTESTS, DISPUTES, AND APPEALS--Table of Contents




                         Subpart 533.1_Protests

Sec.
533.103 Protests to the agency.
533.103-72 Solicitation provisions.

                   Subpart 533.2_Disputes and Appeals

533.211 Contracting officer's decision.
533.215 Contract clause.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37224, July 9, 1999, unless otherwise noted.



                         Subpart 533.1_Protests



533.103  Protests to the agency.



533.103-72  Solicitation provisions.

    Include the provision at 552.233-70, Protests Filed Directly With 
the General Services Administration, in each solicitation for either:
    (a) Supplies, services, construction, or architect-engineer services 
expected to exceed the simplified acquisition threshold.
    (b) Acquisition of leasehold interests in real property expected to 
exceed the simplified lease acquisition threshold.



                   Subpart 533.2_Disputes and Appeals



533.211  Contracting officer's decision.

    In addition to the information in FAR 33.211(a)(4)(v), advise the 
contractor in your written decision that a notice of appeal must:
    (a) Describe the nature of the dispute and the relief sought, the 
contract provisions involved, and any other additional information or 
comments relating to the dispute considered important.
    (b) Be signed personally by the appellant (the prime contractor 
making the appeal) or by an officer of the appellant corporation, or 
member of the appellant firm, or by the contractor's duly authorized 
representative or attorney.



533.215  Contract clause.

    Insert the clause at 552.233-71, Disputes (Utility Contracts), in 
solicitations and contracts for utility services subject to the 
jurisdiction and regulation of a utility rate commission.

[70 FR 299, Jan. 4, 2005]

[[Page 210]]



             SUBCHAPTER F_SPECIAL CATEGORIES OF CONTRACTING





PART 536_CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS--Table of Contents




                          Subpart 536.1_General

Sec.
536.101 Applicability.

      Subpart 536.2_Special Aspects of Contracting for Construction

536.213 Special procedures for sealed bidding in construction 
          contracting.
536.213-3 Invitations for bids.
536.213-370 Bids that include alternates.
536.213-371 Bids that include options.
536.213-372 Bids that include both alternates and options.
536.270 Exercise of options.
536.271 Project labor agreements.

                     Subpart 536.5_Contract Clauses

536.570 Supplemental provisions and clauses.
536.570-1 Definitions.
536.570-2 Authorities and limitations.
536.570-3 Specialist.
536.570-4 Basis of award--construction contract.
536.570-5 Working hours.
536.570-6 Use of premises.
536.570-7 Measurements.
536.570-8 Specifications and drawings.
536.570-9 Shop drawings, coordination drawings, and schedules.
536.570-10 Samples.
536.570-11 Heat.
536.570-12 Use of equipment by the Government.
536.570-13 Subcontracts.
536.570-14 Requirement for a Project Labor Agreement.

                Subpart 536.6_Architect-Engineer Services

536.602 Selection of firms for architect-engineer contracts.
536.602-1 Selection criteria.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37224, July 9, 1999, unless otherwise noted.



                          Subpart 536.1_General



536.101  Applicability.

    If a requirement in this part is inconsistent with a requirement in 
another GSAR part, this part takes precedence.



      Subpart 536.2_Special Aspects of Contracting for Construction



536.213  Special procedures for sealed bidding in construction contracting.



536.213-3  Invitations for bids.



536.213-370  Bids that include alternates.

    (a) The base bid must include all features essential to a sound and 
adequate building design. If it appears that funds available for a 
project may be insufficient to include all desired features in the base 
bid, you may issue a solicitation for a base bid and include one or more 
alternates in the order of priority. Use alternates only if they are 
clearly justified and involve substantial amounts of work in relation to 
the base bid. Their use must be limited and should involve only ``add'' 
alternates.
    (b) Before opening bids that include alternates, determine, and 
record in the contract file, the amount of funds available for the 
project. The amount recorded must be announced at the beginning of the 
bid opening. The amount is the controlling factor in determining the low 
bidder. This amount may be increased later when determining the 
alternate items to award to the low bidder if the following condition is 
met: the award amount of the base bid plus the combination of alternate 
items does not exceed the amount offered for the base bid and the same 
combination of alternate items by any other responsible bidder whose bid 
conforms to the solicitation. This requirement prevents the displacement 
of the low bidder by manipulating the alternates to be used.



536.213-371  Bids that include options.

    (a) Subject to the limitations in paragraph (c) of this section, you 
may include options in contracts if it is in the Government's interest.
    (b) the appropriate use of options may include, but is not limited 
to, any of the following:
    (1) If additional work is anticipated but funds are not expected to 
be available at the time of award, and it would

[[Page 211]]

not be practicable to award a separate contract or to permit an 
additional contractor to work on the same site.
    (2) If fixed building equipment, e.g. elevators or escalators, will 
be installed under the construction contract and it is advantageous to 
have the installer of the equipment maintain and service the equipment 
during the warranty period.
    (c) You must not use options under any of the following conditions:
    (1) the prospective option represents known firm requirements for 
which funds are available unless competition for the option quantity is 
impracticable once the initial contract is awarded.
    (2) The contractor will incur undue risks; e.g., the price or 
availability of necessary materials or labor is not reasonably 
foreseeable.
    (d) Solicitations containing option provisions must state the period 
within which the options may be exercised.
    (e) Solicitations must state whether the basis of award is inclusive 
or exclusive of the options. Before issuing a solicitation that includes 
evaluated options, you must determine that there is reasonable certainty 
that funds will be made available to permit exercise of the option.



536.213-372  Bids that include both alternates and options.

    (a) Solicitations may include both alternates and options if the 
conditions in 536.213-370, Bids that include alternates, and 536.213-
371, Bids that include options, are satisfied. In these solicitations, 
the low bidder for purposes of award is the responsible bidder offering 
the lowest aggregate price for the base bid and the alternates, in the 
order of priority listed in the solicitation, that provide the most work 
features within the funds available at bid opening, plus all options 
designated to be evaluated.
    (b) The basis of award may require the evaluation of options 
associated with alternates if the related alternate is selected.
    (c) Before opening bids that include both alternates and options, 
determine, and record in the contract file, the amount of funds 
available for the project (i.e., for the base bid and alternate work). 
The amount recorded must be announced at the beginning of the bid 
opening. This amount may be increased later when determining the 
alternate items to be awarded to the low bidder if the following 
condition is met: the award amount of the base bid and evaluated options 
plus the alternate items does not exceed the amount offered for the base 
bid, the evaluated options, and the same combination of alternate items 
by any other responsible bidder whose bid conforms to the solicitation.



536.270  Exercise of options.

    (a) If exercising an option, notify the contractor, in writing, 
within the time period specified in the contract.
    (b) Exercise options only after determining that all the following 
conditions exist:
    (1) Funds are available.
    (2) The requirement covered by the option fulfills an existing 
Government need.
    (3) Exercising the option is the most advantageous method of 
satisfying the Government's need, price and other factors considered.
    (c) Before exercising an option, you must determine that the action 
complies with the option's terms and this section's requirements. 
Include your written determination in the contract file.
    (d) The contract modification, or other written document which 
notifies the contractor of the exercise of the option, must cite the 
option clause as authority. If exercising an unpriced or unevaluated 
option, cite the statutory authority permitting the use of other than 
full and open competition (see FAR 6.302 and 517.207).



536.271  Project labor agreements.

    (a) Authority. This subpart implements the Presidential memorandum 
of June 5, 1997, on using project labor agreements (PLAs) on Federal 
construction projects. The Presidential memorandum authorizes executive 
departments and agencies to require PLAs on large and significant 
construction projects for facilities to be owned by a Federal department 
or agency.
    (b) Applicability. These policies and procedures apply to all GSA 
activities

[[Page 212]]

authorized to award contracts for construction of facilities to be owned 
by a Federal department or agency. You may use a PLA in leasehold 
arrangement, Federally funded projects, and other appropriate 
circumstances.
    (c) Definitions. Construction means construction, alteration, or 
repair (including dredging, excavating, and painting) of buildings, 
structures, or other real property. The terms buildings, structures, or 
other real property are defined further in Federal Acquisition 
Regulation (FAR) 36.102.
    Labor organization means a labor organization engaged in an industry 
affecting commerce, and any agent of such an organization, and includes 
any organization of any kind, and any agency, or employee representation 
committee, group, association, or plan so engaged in which employees 
participate and which exists for the purpose, in whole or in part, of 
dealing with employers concerning grievances, labor disputes, wages, 
rates of pay, hours, or other terms or conditions of employment, and any 
conference, general committee, joint or system board, or joint council 
so engaged which is subordinate to a national or international labor 
organization (42 U.S.C. 2000e(d)).
    Large and significant project means a Federal construction project 
with a total cost to the Federal Government of more than $5 million.
    Project Labor Agreement (PLA) means an agreement between the 
contractor, subcontractors, and the union(s) representing workers. Under 
a PLA, the contractor and subcontractors on a project and the union(s) 
agree on terms and conditions of employment for the project, 
establishing a framework for labor-management cooperation to advance the 
Government's procurement interest in cost, efficiency, and quality.
    (d) Policy. (1) You may, on a project-by-project basis, use a PLA on 
a large and significant project when both of the following conditions 
apply:
    (i) A PLA will advance the Government's procurement interests.
    (ii) No laws that apply to the specific construction project 
preclude the use of the PLA.
    (2) Do not require any contractor to enter into a PLA with any 
particular labor organization.
    (3) The use of a PLA is not intended to create any right or benefit, 
substantive or procedural enforceable by a nonfederal party against the 
United States, its departments, and agencies, its officers or employees, 
or any other person.
    (e) Procedures. (1) As part of procurement planning for construction 
projects with a total estimated cost to the Federal Government of more 
than $5 million, you may consider requiring a PLA.
    (2) To require a PLA, you must determine whether use of a PLA will 
advance the Government's procurement interests in all the following 
areas:
    (i) Cost, efficiency, and quality.
    (ii) Promoting labor-management stability.
    (iii) Promoting compliance with applicable legal requirements 
governing safety and health, equal employment opportunity, labor and 
employment standards, and other matters.
    (3) In making the determination required by paragraph (b) of this 
section, consult with the agency project or program manager and obtain 
guidance from the Agency Labor Advisor and assigned legal counsel. You 
should consider the following factors:
    (i) Whether past experience with construction projects in the 
location where the project will be performed indicates that a PLA will 
be effective.
    (ii) Whether delays in performance of the construction contract 
would have significant adverse impact on the mission of the agency or 
operation of the installation or facility.
    (iii) Whether any law applies to the specific construction project 
that would impede use of a PLA.
    (iv) Whether the labor organizations in the area can provide a 
reliable source of skilled, experienced building trades workers in all 
crafts needed on the job site for the project's duration (taking into 
consideration other major construction work in the area).
    (v) Whether the Government can benefit from uniform work rules and 
working conditions and established procedures for resolving labor 
disputes, no strike/no lock-out protections.
    (vi) Whether the Government can benefit from increased stability and

[[Page 213]]

labor peace that derives from greater labor-management cooperation.
    (vii) Whether the requirements for a PLA will unreasonably restrict 
competition.
    (viii) Other relevant information.
    (4) Document the rationale supporting your decision to require a PLA 
in the contract file.
    (5) Provide the following information to the Agency Labor Advisor 
(GSA Acquisition Policy Division (MVP)):
    (i) A brief description of the project.
    (ii) The estimated cost.
    (iii) A copy of the document supporting your decision to require a 
PLA.
    (iv) A copy of the solicitation.



                     Subpart 536.5_Contract Clauses



536.570  Supplemental provisions and clauses.



536.570-1  Definitions.

    Insert 552.236-70, Definitions, in solicitations and contracts if 
construction, dismantling, demolition, or removal of improvements is 
contemplated.



536.570-2  Authorities and limitations.

    Insert 552.236-71, Authorities and Limitations, in solicitations and 
contracts if construction, dismantling, demolition, or removal of 
improvements is contemplated and the contract amount is expected to 
exceed the simplified acquisition threshold.



536.570-3  Specialist.

    Insert 552.236-72, Specialist, in solicitations and contracts for 
construction if the technical sections of the contract require unusual 
experience or specialized facilities for adequate contract performance.



536.570-4  Basis of award--construction contract.

    (a) Insert a provision substantially the same as 552.236-73, Basis 
of Award--Construction Contract, in solicitations for fixed-price 
construction contracts except if any of the following conditions apply:
    (1) The solicitation requires the submission of a lump-sum bid only.
    (2) The solicitation is for an indefinite quantity contract.
    (3) The contract amount is not expected to exceed the simplified 
acquisition threshold.
    (b) Instructions for use.

------------------------------------------------------------------------
     If the solicitation requests the
          submission of a . . .                  Then use the . . .
------------------------------------------------------------------------
(1) Base bid and unit prices.............  Basic provision.
(2) Base bid and options.................  Provision with its Alternate
                                            I.
(3) Base bid and alternates..............  Provision with its Alternate
                                            II.
(4) Base bid, alternates, and options....  Provision with its Alternate
                                            III.
------------------------------------------------------------------------



536.570-5  Working hours.

    Insert 552.236-74, Working Hours, in solicitations and contracts if 
construction, dismantling, demolition, or removal of improvements is 
contemplated and the contract amount is expected to exceed the 
simplified acquisition threshold.



536.570-6  Use of premises.

    Insert 552.236-75, Use of Premises, in solicitations and contracts 
if construction, dismantling, demolition, or removal of improvements is 
contemplated.



536.570-7  Measurements.

    Insert 552.236-76, Measurements, in solicitations and contracts if 
construction, dismantling, demolition, or removal of improvements is 
contemplated.



536.570-8  Specifications and drawings.

    Insert the clause at 552.236-77, Specifications and Drawings, in 
solicitations and contracts if construction, dismantling, demolition, or 
removal of improvements is contemplated and the contract amount is 
expected to exceed the simplified acquisition threshold.



536.570-9  Shop drawings, coordination drawings, and schedules.

    Insert the clause at 552.236-78, Shop Drawings, Coordination 
Drawings, and Schedules, in solicitations and contracts if construction 
is contemplated and the contract amount is expected to exceed the 
simplified acquisition threshold.



536.570-10  Samples.

    Insert the clause at 552.236-79, Samples, in solicitations and 
contracts for construction if the technical sections

[[Page 214]]

of the contract require the submission and approval of samples.



536.570-11  Heat.

    Insert the clause at 552.236-80, Heat, in solicitations and 
contracts if construction, dismantling, demolition, or removal of 
improvements is contemplated.



536.570-12  Use of equipment by the Government.

    Insert the clause at 552.236-81, Use of Equipment by the Government, 
in contracts requiring heating and air-conditioning of existing 
buildings if it may be necessary for the Government to operate all or 
part of the equipment before final acceptance of the contract.



536.570-13  Subcontracts.

    Insert 552.236-82, Subcontracts, in solicitations and contracts for 
construction if the contract amount is expected to exceed the simplified 
acquisition threshold.



536.570-14  Requirement for a Project Labor Agreement.

    Insert a clause substantially the same as 552.236-83, Requirement 
for a Project Labor Agreement, in solicitations and contracts that will 
require a project labor agreement.



                Subpart 536.6_Architect-Engineer Services



536.602  Selection of firms for architect-engineer contracts.



536.602-1  Selection criteria.

    (a) FAR 36.602-1 requires that agencies include ``location in the 
general geographical area of the project and knowledge of locality of 
the project'' as one of several selection criteria.
    (1) Do not use this evaluation factor as a minimum qualification 
requirement for determining whether a firm is eligible to compete for a 
proposed project.
    (2) This factor must not exceed 5 percent of the total weight of all 
evaluation criteria. In order to receive maximum score for this factor, 
the architect-engineer firm(s) must demonstrate that at least 35 percent 
of the architect-engineer contract services (based on the total contract 
price) will be accomplished within the geographical boundaries 
established for the project.
    (3) Under an approved class deviation from FAR 36.602-1(a)(5), this 
factor does not apply to projects that the Chief Architect of GSA 
determines have national significance.
    (b) The public announcement (Commerce Business Daily notice) for a 
proposed project should identify the general geographical area of the 
project by either:
    (1) A radius in miles or other appropriate unit of measure.
    (2) The Standard Metropolitan Statistical Area, county(ies), 
state(s) surrounding the project, or other appropriate geographic 
boundaries.
    (c) Architect-engineer selections under the Design Excellence 
Program must apply the geographical evaluation criteria in the second 
phase.
    (d) The public announcement (Commerce Business Daily notice) must 
provide the number of calendar days the architect-engineer of record has 
to establish a production capability within the general geographical 
area of the project. You may allow the architect-engineer of record up 
to 45 calendar days after contract award to establish this production 
capability.

[65 FR 11247, Mar. 2, 2000]



PART 537_SERVICE CONTRACTING--Table of Contents




                 Subpart 537.1_Service Contracts_General

Sec.
537.101 Definitions.
537.110 Solicitation provisions and contract clauses.

             Subpart 537.2_Advisory and Assistance Services

537.270 Contract clause.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37226, July 9, 1999, unless otherwise noted.



                 Subpart 537.1_Service Contracts_General



537.101  Definitions.

    Contracts for building services means contracts for services 
relating to the

[[Page 215]]

operation and maintenance of a building (for example, janitorial; window 
washing; snow removal; trash removal; lawn and grounds care; inspection, 
maintenance and repair of fixed equipment (e.g., elevators, air-
conditioning, hearing systems)) and protection or guard service.



537.110  Solicitation provisions and contract clauses.

    The following provision and clauses apply to contracts for building 
services:
    (a) If the contract is expected to exceed the simplified acquisition 
threshold and it is not initiated under the Javits-Wagner-O'Day Act:
    (1) Insert 552.237-70, Qualifications of Offerors, in the 
solicitation.
    (2) Insert 552.237-71, Qualifications of Employees, in the 
solicitation and contract. If needed, use supplemental provisions or 
clauses to describe specific requirements for employees performing work 
on the contract.
    (b) Insert 552.237-72, Prohibition Regaring ``Quasi-Military Armed 
Forces,'' in solicitations and contracts for guard service.

[65 FR 41379, July 5, 2000]



             Subpart 537.2_Advisory and Assistance Services



537.270  Contract clause.

    Insert the clause at 552.237-73, Restriction on Disclosure of 
Information, in solicitations and contracts for proposal evaluation and 
analysis services.



PART 538_FEDERAL SUPPLY SCHEDULE CONTRACTING--Table of Contents




  Subpart 538.2_Establishing and Administering Federal Supply Schedules

Sec.
538.270 Evaluation of multiple award schedule (MAS) offers.
538.271 MAS contract awards.
538.272 MAS price reductions.
538.273 Contract clauses.

                  Subpart 538.70_Cooperative Purchasing

538.7000 Scope of subpart.
538.7001 Definitions.
538.7002 General.
538.7003 Policy.
538.7004 Solicitation provisions and contract clauses.

                   Subpart 538.71_Recovery Purchasing

538.7100 Scope of subpart.
538.7101 Definitions.
538.7102 General.
538.7103 Policy.
538.7104 Solicitation provisions and contract clauses.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37227, July 9, 1999, unless otherwise noted.

    Editorial Note: Nomenclature changes to part 538 appear at 69 FR 
28065, May 18, 2004.



  Subpart 538.2_Establishing and Administering Federal Supply Schedules



538.270  Evaluation of multiple award schedule (MAS) offers.

    (a) The Government will seek to obtain the offeror's best price (the 
best price given to the most favored customer). However, the Government 
recognizes that the terms and conditions of commercial sales vary and 
there may be legitimate reasons why the best price is not achieved.
    (b) Establish negotiation objectives based on a review of relevant 
data and determine price reasonableness.
    (c) When establishing negotiation objectives and determining price 
reasonableness, compare the terms and conditions of the MAS solicitation 
with the terms and conditions of agreements with the offeror's 
commercial customers. When determining the Government's price 
negotiation objectives, consider the following factors:
    (1) Aggregate volume of anticipated purchases.
    (2) The purchase of a minimum quantity or a pattern of historic 
purchases.
    (3) Prices taking into consideration any combination of discounts 
and concessions offered to commercial customers.
    (4) Length of the contract period.
    (5) Warranties, training, and/or maintenance included in the 
purchase price or provided at additional cost to the product prices.
    (6) Ordering and delivery practices.
    (7) Any other relevant information, including differences between 
the MAS solicitation and commercial terms and

[[Page 216]]

conditions that may warrant differentials between the offer and the 
discounts offered to the most favored commercial customer(s). For 
example, an offeror may incur more expense selling to the Government 
than to the customer who receives the offeror's best price, or the 
customer (e.g., dealer, distributor, original equipment manufacturer, 
other reseller) who receives the best price may perform certain value-
added functions for the offeror that the Government does not perform. In 
such cases, some reduction in the discount given to the Government may 
be appropriate. If the best price is not offered to the Government, you 
should ask the offeror to identify and explain the reason for any 
differences. Do not require offerors to provide detailed cost 
breakdowns.
    (d) You may award a contract containing pricing which is less 
favorable than the best price the offeror extends to any commercial 
customer for similar purchases if you make a determination that both of 
the following conditions exist:
    (1) The prices offered to the Government are fair and reasonable, 
even though comparable discounts were not negotiated.
    (2) Award is otherwise in the best interest of the Government.



538.271  MAS contract awards.

    (a) MAS awards will be for commercial items as defined in FAR 2.101. 
Negotiate contracts as a discount from established catalog prices.
    (b) Before awarding any MAS contract, determine that the offered 
prices are fair and reasonable (see FAR subpart 15.4 and 538.270). 
Document the negotiation and your determination using FAR 15.406-3 as 
guidance.
    (c) State clearly in the award document the price/discount 
relationship between the Government and the identified commercial 
customer (or category of customers) on which the award is predicated.



538.272  MAS price reductions.

    (a) Section 552.238-75, Price Reductions, requires the contractor to 
maintain during the contract period the negotiated price/discount 
relationship (and/or term and condition relationship) between the 
eligible ordering activities and the offeror's customer or category of 
customers on which the contract award was predicated (see 538.271(c)). 
If a change occurs in the contractor's commercial pricing or discount 
arrangement applicable to the identified commercial customer (or 
category of customers) that results in a less advantageous relationship 
between the eligible ordering activities and this customer or category 
of customers, the change constitutes a ``price reduction.''
    (b) Make sure that the contractor understands the requirements of 
section 552.238-75 and agrees to report to you all price reductions as 
provided for in the clause.

[64 FR 37227, July 9, 1999, as amended at 68 FR 24378, May 7, 2003]



538.273  Contract clauses.

    (a) Multiple award schedules. Insert in solicitations and contracts:
    (1) 552.238-70, Identification of Electronic Office Equipment 
Providing Accessibility for the Handicapped, if you include electronic 
office equipment items.
    (2) 552.238-71, Submission and Distribution of Authorized FSS 
Schedule Pricelists.
    (i) Use Alternate I, in solicitations and contracts for--
    (A) Federal Supply Schedule 70;
    (B) The Consolidated Schedule contracts containing information 
technology Special Item Numbers;
    (C) Federal Supply Schedule 84; and
    (D) Federal Supply Schedules for recovery purchasing (see 538.7102), 
use Alternate I.
    (ii) If GSA is not prepared to accept electronic submissions for a 
particular schedule delete--
    (A) The paragraph identifier ``(i)'' in (b)(1) and the word ``and'' 
at the end of paragraph (b)(1)(i); and
    (B) Paragraphs (b)(1)(ii) and (b)(3).
    (3) 552.238-72, Identification of Products That Have Environmental 
Attributes.
    (4) 552.238-73, Cancellation.
    (b) Multiple and single award schedules. Insert in solicitations and 
contracts:
    (1) 552.238-74, Industrial Funding Fee and Sales Reportings.

[[Page 217]]

    (2) 552.238-75, Price Reductions. Use Alternate I in solicitations 
and contracts for--
    (i) Federal Supply Schedule 70;
    (ii) The Consolidated Schedule containing information technology 
Special Item Numbers;
    (iii) Federal Supply Schedule 84; and
    (iv) Federal Supply Schedules for recovery purchasing (see 
538.7102).

[64 FR 37227, July 9, 1999, as amended at 68 FR 24378, May 7, 2003; 68 
FR 41288, July 11, 2003; 68 FR 52128, Sept. 2, 2003; 72 FR 4652, Feb. 1, 
2007; 73 FR 54338, Sept. 19, 2008]



                  Subpart 538.70_Cooperative Purchasing

    Source: 68 FR 24378, May 7, 2003, unless otherwise noted.



538.7000  Scope of subpart.

    This subpart prescribes policies and procedures that implement 
statutory provisions authorizing non-federal organizations to use--
    (a) Federal Supply Schedule 70;
    (b) The Consolidated Schedule contracts containing information 
technology Special Item Numbers (SINs); and
    (c) Federal Supply Schedule 84.

[73 FR 54338, Sept. 19, 2008]



538.7001  Definitions.

    Ordering activity (also called ``ordering agency'' and ``ordering 
office'') means an eligible ordering activity (see 552.238-78) 
authorized to place orders under Federal supply schedule contracts.
    Schedule 70, as used in this subpart, means Schedule 70 information 
technology contracts, and Consolidated Products and Services Schedule 
contracts containing information technology SINs. The Consolidated 
Products and Services Schedule is a compilation of multiple individual 
Federal Supply Schedules; therefore, only the SINs that fall under 
Schedule 70 of the Consolidated Products and Services Schedule will 
apply to Cooperative Purchasing. No other Schedules, or SINs, containing 
information technology outside of Schedule 70 SINs, and Consolidated 
Products and Services Schedule contracts containing Schedule 70 SINs, 
will apply.
    Schedule 84 means the Federal Supply Schedule for alarm and signal 
systems, facility management systems, firefighting and rescue equipment, 
law enforcement and security equipment, marine craft and related 
equipment, special purpose clothing, and related services (as contained 
in Federal Supply Classification Code Group 84 or any amended or 
subsequent version of that Federal supply classification group).
    State and local government entities, as used in this subpart, means 
the states of the United States, counties, municipalities, cities, 
towns, townships, tribal governments, public authorities (including 
public or Indian housing agencies under the United States Housing Act of 
1937), school districts, colleges and other institutions of higher 
education, council of governments (incorporated or not), regional or 
interstate government entities, or any agency or instrumentality of the 
preceding entities (including any local educational agency or 
institution of higher education), and including legislative and judicial 
departments. The term does not include contractors of, or grantees of, 
State or local governments.
    (1) Local educational agency has the meaning given that term in 
section 8013 of the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 7713).
    (2) Institution of higher education has the meaning given that term 
in section 101(a) of the Higher Education Act of 1965 (20 U.S.C. 
1001(a)).
    (3) Tribal government means--
    (i) The governing body of any Indian tribe, band, nation, or other 
organized group or community located in the continental United States 
(excluding the State of Alaska) that is recognized as eligible for the 
special programs and services provided by the United States to Indians 
because of their status as Indians; and
    (ii) Any Alaska Native regional or village corporation established 
pursuant to the Alaska Native Claims Settlement Act (43 U.S.C. 1601 et 
seq.).

[68 FR 24378, May 7, 2003, as amended at 73 FR 54338, Sept. 19, 2008]

[[Page 218]]



538.7002  General.

    (a) 40 U.S.C. 501, (the Act) authorizes the Administrator of General 
Services to procure and supply personal property and nonpersonal 
services for the use of Executive agencies. Under 40 U.S.C. 502, the 
goods and services available to executive agencies are also available to 
mixed ownership Government corporations, establishments within the 
legislative or judicial branches of Government (excepting the Senate, 
House of Representatives, Architect of the Capitol, and any activities 
under the direction of the Architect of the Capitol), the District of 
Columbia, and Qualified Non-profit Agencies.
    (b) Section 211 of the E-Government Act of 2002 amends 40 U.S.C. 502 
to authorize the Administrator of General Services to provide for use of 
certain Federal supply schedules of the GSA by a State or local 
government, which includes any State, local, regional, or tribal 
government, or any instrumentality thereof (including any local 
educational agency or institution of higher education).
    (c) Pub.L. 110-248, The Local Preparedness Acquisition Act, 
authorizes the Administrator of General Services to provide for the use 
by state or local governments of Federal Supply Schedules of the General 
Services Administration (GSA) for alarm and signal systems, facility 
management systems, firefighting and rescue equipment, law enforcement 
and security equipment, marine craft and related equipment, special 
purpose clothing, and related services (as contained in Schedule 84).
    (d) State and local governments are authorized to procure from 
Schedule 70 contracts, Consolidated Schedule contracts containing 
information technology SINs, and Schedule 84 contracts. A listing of the 
participating contractors and SINs for the products and services that 
are available through Schedule 70 contracts, the Consolidated Schedule 
contracts containing information technology SINs, and Schedule 84 
contracts, is available in GSA's Schedules e-Library at www.gsa.gov/
elibrary. Click on Schedules e-Library, and under Cooperative 
Purchasing, click on ``View authorized vendors.'' The contractors and 
the products and services available for Cooperative Purchasing will be 
labeled with the Cooperative Purchasing icon.

[68 FR 24378, May 7, 2003, as amended at 73 FR 54338, Sept. 19, 2008]



538.7003  Policy.

    Preparing solicitations when schedules are open to eligible non-
federal entities. When opening Schedule 70, the Consolidated Schedule 
containing information technology SINs, and Schedule 84, for use by 
eligible non-federal entities, the contracting officer must make minor 
modifications to certain Federal Acquisition Regulation and GSAM 
provisions and clauses in order to make clear distinctions between the 
rights and responsibilities of the U.S. Government in its management and 
regulatory capacity pursuant to which it awards schedule contracts and 
fulfills associated Federal requirements versus the rights and 
responsibilities of eligible ordering activities placing orders to 
fulfill agency needs. Accordingly, the contracting officer is authorized 
to modify the following FAR provisions/clauses to delete ``Government'' 
or similar language referring to the U.S. Government and substitute 
``ordering activity'' or similar language when preparing solicitations 
and contracts to be awarded under Schedule 70, and the Consolidated 
Schedule containing information technology SINs, and Schedule 84. When 
such changes are made, the word ``(DEVIATION)'' shall be added at the 
end of the title of the provision or clause. These clauses include but 
are not limited to:
    (a) 52.212-4, Contract Terms and Conditions--Commercial Items.
    (b) 52.216-18, Ordering.
    (c) 52.216-19, Order Limitations.
    (d) 52.229-1, State and Local Taxes.
    (e) 52.229-3, Federal, State, and Local Taxes.
    (f) 52.232-7, Payments Under Time-and-Materials and Labor-Hour 
Contracts.
    (g) 52.232-17, Interest.
    (h) 52.232-19, Availability of Funds for the Next Fiscal Year.
    (i) 52.232-34, Payment by Electronic Funds Transfer--Other than 
Central Contractor Registration
    (j) 52.232-36, Payment by Third Party.
    (k) 52.237-3, Continuity of Services.

[[Page 219]]

    (l) 52.246-4, Inspection of Services-Fixed Price.
    (m) 52.246-6, Inspection-Time-and-Material and Labor-Hour.
    (n) 52.247-34, F.O.B. Destination.
    (o) 52.247-38, F.O.B. Inland Carrier Point of Exportation.

[68 FR 24378, May 7, 2003, as amended at 73 FR 54338, Sept. 19, 2008]



538.7004  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 552.238-77, 
Definition (Federal Supply Schedules), in solicitations and contracts 
for--
    (1) Schedule 70;
    (2) The Consolidated Schedule containing information technology 
SINs; and
    (3) Schedule 84.
    (b) The contracting officer shall insert the clause at 552.238-78, 
Scope of Contract (Eligible Ordering Activities), in solicitations and 
contracts for--
    (1) Schedule 70; and
    (2) The Consolidated Schedule containing information technology 
SINs; and
    (3) Schedule 84.
    (c) The contracting officer shall insert the clause at 552.238-79, 
Use of Federal Supply Schedule Contracts by Certain Entities--
Cooperative Purchasing, in solicitations and contracts for--
    (1) Schedule 70;
    (2) The Consolidated Schedule containing information technology 
SINs; and
    (3) Schedule 84.
    (d) See 552.101-70 for authorized FAR deviations.

[73 FR 54339, Sept. 19, 2008]



                   Subpart 538.71_Recovery Purchasing

    Source: 72 FR 4653, Feb. 1, 2007, unless otherwise noted.



538.7100  Scope of subpart.

    This subpart prescribes policies and procedures to implement the 
John Warner National Defense Authorization Act for Fiscal Year 2007 
(Pub. L. 109-364) authorizing non-federal organizations to use Federal 
Supply Schedule contracts to purchase products and services to be used 
for recovery from major disasters, terrorism or nuclear, biological, 
chemical, or radiological attack.



538.7101  Definitions.

    The definitions in subsection 538.7001 shall apply for purposes of 
this subpart.



538.7102  General.

    (a) Section 833 of the John Warner National Defense Authorization 
Act for Fiscal Year 2007 (Pub. L. 109-364) amends 40 U.S.C. 502 to 
authorize the Administrator of General Services to provide to State and 
local governments the use of Federal Supply Schedules of the GSA for 
purchase of products and services to be used to facilitate recovery from 
a major disaster declared by the President under the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) or 
to facilitate recovery from terrorism or nuclear, biological, chemical, 
or radiological attack. Section 833 requires the Secretary of Homeland 
Security to determine which products and services qualify before the 
Administrator provides for the use of the Federal Supply Schedules. Use 
of Federal supply schedules by State and local governments is voluntary. 
Agreement of a schedule contractor to offer recovery purchasing under 
the contract and acceptance of any order for recovery purchasing from a 
State or local government is voluntary.
    (b) State and local governments are authorized to use Federal Supply 
Schedules to procure products and services determined by the Secretary 
of Homeland Security to be used to facilitate recovery from major 
disasters, terrorism, or nuclear, biological, chemical, or radiological 
attack. A listing of the Federal Supply Schedules for the products and 
services is available in GSA's Schedules e-Library at Web site http://
www.gsaelibrary.gsa.gov. Click on the link, ``Disaster Recovery 
Purchasing, State and Local.'' The participating contractors and the 
products and services available for recovery purchasing will be labeled 
with the Disaster Recovery Purchasing ICON.
    (c) State and local governments that wish to use the Federal Supply 
Schedules to facilitate recovery from major

[[Page 220]]

disasters or attacks are responsible for ensuring that only authorized 
representatives of their governments place orders against these 
schedules and that procured products and services are used only for the 
purposes authorized by Section 833 of Public Law 109-364.



538.7103  Policy.

    Preparing solicitations when schedules are open to eligible non-
federal entities. When opening the Federal Supply Schedules for products 
and services determined by the Secretary of Homeland Security, for use 
by eligible non-federal entities, the contracting officer must make 
minor modifications to certain Federal Acquisition Regulation (FAR) and 
GSAM provisions and clauses in order to make clear distinctions between 
the rights and responsibilities of the U.S. Government in its management 
and regulatory capacity pursuant to which it awards schedule contracts 
and fulfills associated Federal requirements versus the rights and 
responsibilities of eligible ordering activities placing orders to 
fulfill agency needs. Accordingly, the contracting officer is authorized 
to modify the following FAR provisions/clauses to delete ``Government'' 
or similar language referring to the U.S. Government and substitute 
``ordering activity'' or similar language when preparing solicitations 
and contracts to be awarded under the Federal Supply Schedules for 
products and services determined by the Secretary of Homeland Security. 
When such changes are made, the word ``(DEVIATION)'' shall be added at 
the end of the title of the provision or clause. These clauses include 
but are not limited to--
    (a) 52.212-4, Contract Terms and Conditions--Commercial Items.
    (b) 52.216-18, Ordering.
    (c) 52.216-19, Order Limitations.
    (d) 52.229-1, State and Local Taxes.
    (e) 52.229-3, Federal, State, and Local Taxes.
    (f) 52.232-7, Payments Under Time-and-Materials and Labor-Hour 
Contracts.
    (g) 52.232-17, Interest.
    (h) 52.232-19, Availability of Funds for the Next Fiscal Year.
    (i) 52.232-34, Payment by Electronic Funds Transfer--Other than 
Central Contractor Registration.
    (j) 52.232-36, Payment by Third Party.
    (k) 52.237-3, Continuity of Services.
    (l) 52.246-4, Inspection of Services-Fixed Price.
    (m) 52.246-6, Inspection-Time-and-Material and Labor-Hour.
    (n) 52.247-34, F.O.B. Destination.
    (o) 52.247-38, F.O.B. Inland Carrier Point of Exportation.



538.7104  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the clause at 552.238-76, 
Definition (Federal Supply Schedules)--Recovery Purchasing, in Federal 
Supply Schedule solicitations and contracts which contain products and 
services determined by the Secretary of Homeland Security to facilitate 
recovery from major disasters, terrorism, or nuclear, biological, 
chemical, or radiological attack.
    (b) The contracting officer shall insert the clause at 552.238-78, 
Scope of Contract (Eligible Ordering Activities), with Alternate I in 
Federal Supply Schedule solicitations and contracts which contain 
products and services determined by the Secretary of Homeland Security 
to facilitate recovery from major disasters, terrorism, or nuclear, 
biological, chemical, or radiological attack.
    (c) The contracting officer shall insert the clause at 552.238-80, 
Use of Federal Supply Schedule Contracts by Certain Entities--Recovery 
Purchasing, in Federal Supply Schedule solicitations and contracts which 
contain products and services determined by the Secretary of Homeland 
Security that facilitate recovery from major disasters, terrorism, or 
nuclear, biological, chemical, or radiological attack.
    (d) See 552.101-70 for authorized Federal Acquisition Regulation 
deviations.

[[Page 221]]



                    SUBCHAPTER G_CONTRACT MANAGEMENT





PART 542_CONTRACT ADMINISTRATION AND AUDIT SERVICES--Table of Contents




          Subpart 542.11_Production Surveillance and Reporting

Sec.
542.1107 Contract clause.

            Subpart 542.15_Contractor Performance Information

542.1503 Procedures.
542.1503-71 Information to collect.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37228, July 9, 1999, unless otherwise noted.



          Subpart 542.11_Production Surveillance and Reporting



542.1107  Contract clause.

                   FSS Stock or Special Order Program

    Insert 552.242-70, Status Report of Orders and Shipments, in 
solicitations and indefinite quantity and requirements contracts for 
stock or special order program items. You also may use the clause in 
indefinite delivery definite quantity contracts for stock or special 
order program items when close monitoring is necessary because numerous 
shipments are involved.



            Subpart 542.15_Contractor Performance Information



542.1503  Procedures.



542.1503-71  Information to collect.

    The system for collecting contractor performance data should 
include, as appropriate:
    (a) Timeliness of delivery or performance, for example:
    (1) Adherence to contract delivery schedules.
    (2) Resolution of delays
    (3) Number of ``show cause'' letters and ``cure notices'' issued.
    (4) Number of delinquent deliveries.
    (5) Number of contract extensions resulting from contractor-caused 
delays.
    (6) Timely submission or performance or required tests.
    (b) Conformance of product or service to contract requirements, for 
example:
    (1) Quality of workmanship.
    (2) Reliability.
    (3) Adequacy of correction of defects.
    (4) Number of safety defects.
    (5) Number of product rejections.
    (6) Results of laboratory tests.
    (7) Number and extent of warranty problems.
    (c) Customer comments, for example:
    (1) Number and quality of positive comments.
    (2) Number and nature of complaints.
    (3) Adequacy of resolving customer complaints.
    (d) Terminations for default.
    (e) On-the-job safety performance record, including the number of 
lost or restricted workdays due to occupational injuries in comparison 
to the national average.
    (f) Adequacy of contractor's quality assurance system.
    (g) Compliance with other key contract provisions, for example:
    (1) Subcontracting program.
    (2) Labor standards.
    (3) Safety standards.
    (4) Reporting requirements.
    (h) Exhibiting customer-oriented behavior.
    (i) Other performance elements identified by the Service.



PART 543_CONTRACT MODIFICATIONS--Table of Contents




    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37228, July 9, 1999, unless otherwise noted.



                       Subpart 543.2_Change Orders



543.205  Contract clauses.

    (a) Construction. (1) Insert 552.243-70, Pricing of Adjustments, in 
solicitations and contracts if the contract:
    (i) Amount is expected to exceed the simplified acquisition 
threshold.
    (ii) Will be other than a cost type.
    (2) Insert 552.243-71, Equitable Adjustments, in solicitations and 
contracts containing FAR 52.243-4.

[[Page 222]]

    (b) Multiple award schedules (MAS). Insert 552.243-72, Modifications 
(Multiple Award Schedule), in MAS solicitations and contracts issued by 
GSA. For solicitations and contracts issued under Federal Supply 
Classification (FSC) 65 you may use the clause with its Alternate I for 
products ordered from authorized Prime Vendors.



PART 546_QUALITY ASSURANCE--Table of Contents




                     Subpart 546.3_Contract Clauses

Sec.
546.302 Fixed-price supply contracts.
546.302-70 Source inspection by Quality Approved Manufacturer.
546.302-71 Source inspection.
546.312 Construction contracts.

           Subpart 546.4_Government Contract Quality Assurance

546.470-2 Certification testing.

                        Subpart 546.7_Warranties

546.708 Warranties of data.
546.710 Contract clauses.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37228, July 9, 1999, unless otherwise noted.



                     Subpart 546.3_Contract Clauses



546.302  Fixed-price supply contracts.



546.302-70  Source inspection by Quality Approved Manufacturer.

    For contracts and solicitations issued by FSS:
    (a) Insert the clause at 552.246-70, Source Inspection by Quality 
Approved Manufacturer, in solicitations and contracts that provide for 
source inspection, except:
    (1) Multiple award schedule contracts.
    (2) Motor vehicle contracts.
    (3) Contracts awarded by the FSS Services Acquisition Center, unless 
you decide, together with the Central Office Quality Assurance Division 
(FQA), that inspection by Government personnel is necessary.
    (b) You may authorize inspection and testing at manufacturing plants 
or other facilities located outside the United States, Puerto Rico, or 
the Virgin Islands, under paragraph (a)(1) of the clause at 552.246-70 
under any of the circumstances listed in this paragraph. Coordinate the 
authorization with FQA and document it in the file.
    (1) Inspection services are available from another Federal agency 
with primary inspection responsibility in the geographic area.
    (2) An inspection interchange agreement exists with another agency 
for inspection at a contractor's plant.
    (3) The procurement is for the Agency for International Development 
and specifies the area of source.
    (4) Other considerations will ensure more economical and effective 
inspection consistent with the Government's interest.



546.302-71  Source inspection.

    For solicitations and contracts issued by FSS, if Government 
personnel at the source will perform inspection, insert 552.246-71, 
Source Inspection by Government.



546.312  Construction contracts.

    Insert the clause at 552.246-72, Final Inspection and Tests, in 
solicitations and contracts for construction that include FAR 52.246-12, 
Inspection of Construction.



           Subpart 546.4_Government Contract Quality Assurance



546.470-2  Certification testing.

    Certification testing determines whether an item conforms with a 
specification for the purpose of executing a certificate of compliance 
required by the specification. The contractor has responsibility for 
certification testing.



                        Subpart 546.7_Warranties



546.708  Warranties of data.

    (a) Use warranties of data only when you meet both of the following 
conditions:
    (1) You decide the use of a warranty is in the Government's 
interest.
    (2) The contracting director concurs in your decision.
    (b) The technical or specification manager has responsibility for 
developing any warranties of data.

[[Page 223]]



546.710  Contract clauses.

    (a) Insert the clause at 552.246-17, Warranty of Supplies of a 
Noncomplex Nature, instead of FAR 52.246-17 in solicitations and 
contracts. Use the following alternates as applicable:
    (1) Commercial item acquisitions other than multiple award 
schedules. Use the clause at 552.246-17 with its Alternate I.
    (2) Other than commercial items in Class 8010. Use the clause at 
552.246-17 with its Alternate II.
    (3) Other than commercial items in Class 8030 or 8040. Use the 
clause at 552.246-17 with its Alternate III. In addition, specify in the 
solicitation whether the items are ``noncritical end use items'' or 
``critical end use items''.
    (b) Multiple award schedules. Insert the clause at 552.246-73, 
Warranty--Multiple Award Schedule, in solicitations and contracts. Use 
Alternate I in solicitations and contracts for--
    (1) Federal Supply Schedule 70;
    (2) The Consolidated Schedule containing information technology 
Special Item Numbers;
    (3) Federal Supply Schedule 84; and
    (4) Federal Supply Schedules for recovery purchasing (see 538.7102).
    (c) Construction contracts expected to exceed the simplified 
acquisition threshold. Insert the clause at 552.246-75, Guarantees, in 
solicitations and contracts.
    (d) Pesticides. Insert the clause at 552.246-76, Warranty of 
Pesticides, in solicitations and contracts involving the procurement of 
pesticides.

[64 FR 37228, July 9, 1999, as amended at 65 FR 11248, Mar. 2, 2000; 68 
FR 24379, May 7, 2003; 69 FR 28065, May 18, 2004; 72 FR 4654, Feb. 1, 
2007; 73 FR 54339, Sept. 19, 2008]



PART 547_TRANSPORTATION--Table of Contents




            Subpart 547.3_Transportation in Supply Contracts

Sec.
547.300 Scope of subpart.
547.303 Standard delivery terms and contract clauses.
547.303-1 F.o.b origin.
547.304 Determination of delivery terms.
547.304-5 Exceptions.
547.305 Solicitation provisions, contract clauses, and transportation 
          factors.

    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37229, July 9, 1999, unless otherwise noted.



            Subpart 547.3_Transportation in Supply Contracts



547.300  Scope of subpart.

    This subpart applies to FSS acquisitions.



547.303  Standard delivery terms and contract clauses.



547.303-1  F.o.b origin.

                       Contractor Responsibilities

    The contractor must both:
    (a) Request a carrier routing from the applicable transportation 
zone office on all shipments weighing 10,000 pounds or more.
    (b) Mail the original of the commercial bill of lading (CBL), to the 
office that authorized the CBL (applies to shipment on a CBL). Ensure 
that the signature of the carrier's agent and the annotation required by 
FAR 52.247-1 appear on the original and all copies of the CBL.



547.304  Determination of delivery terms.



547.304-5  Exceptions.

    (a) Solicitations that provide for delivery to Alaska, Hawaii, or 
Puerto Rico. Include notice that the offeror may specify delivery f.o.b. 
origin; f.o.b. vessel, part of shipment; f.o.b. destination; or any 
combination of these. If appropriate, provide for other delivery terms.
    (b) Federal Supply Schedules. If f.o.b. destination is offered for 
delivery within CONUS, attempt to obtain the same delivery term for 
shipment to Alaska, Hawaii, or Puerto Rico.



547.305  Solicitation provisions, contract clauses, and transportation factors.

    (a) Insert 552.247-70, Placarding Railcar Shipments, in 
solicitations and contracts if it is essential that the railcar doors be 
especially positioned next to the unloading dock, platform, or warehouse 
door.
    (b) Insert 552.247-71, Diversion of Shipment Under f.o.b. 
Destination Contracts, in Stock, Special Order Program (SOP), and Single 
Award Schedule solicitations and contracts which provide for f.o.b. 
destination shipment.

[[Page 224]]



PART 549_TERMINATION OF CONTRACTS--Table of Contents




    Authority: 40 U.S.C. 486(c).

    Source: 64 FR 37229, July 9, 1999, unless otherwise noted.



               Subpart 549.5_Contract Termination Clauses



549.502  Termination for convenience of the Government.

    Acquisitions Funded Through the Information Technology (IT) Fund

    (a) You may use the clause at 552.249-70, Termination for 
Convenience of the Government (Fixed-Price) (Short Form), when 
appropriate, in solicitations and contracts for the acquisition and 
maintenance of telephone systems funded through the Information 
Technology (IT) Fund. Use this clause with FAR 52.249-1 or FAR 52.249-3 
and 52.249-4.
    (b) If you use the clause at 552.249-70, you must also insert 
552.249-71, Submission of Termination Liability Schedule, in the 
solicitation and contract.

[[Page 225]]



                     SUBCHAPTER H_CLAUSES AND FORMS





PART 552_SOLICITATION PROVISIONS AND CONTRACT CLAUSES--Table of Contents




Sec.
552.000 Scope of part.

       Subpart 552.1_Instructions for Using Provisions and Clauses

552.101-70 Using part 552.
552.102 Incorporating provisions and clauses.
552.103 Identification of provisions and clauses.
552.104 Procedures for modifying and completing provisions and clauses.
552.105 Procedures for using alternates.
552.107-70 Provisions and clauses prescribed in subpart 552.1.

              Subpart 552.2_Text of Provisions and Clauses

552.200 Scope of subpart.
552.203-5 Covenant Against Contingent Fees.
552.203-70 Price Adjustment for Illegal or Improper Activity.
552.203-71 Restriction on Advertising.
552.209-70 Product Removal from Qualified Products List.
552.209-71 Waiver of First Article Testing and Approval Requirement.
552.209-72 Supplemental Requirements for First Article Approval--
          Contractor Testing.
552.209-73 Supplemental Requirements for First Article Approval--
          Government Testing.
552.211-8 Time of Delivery.
552.211-15 Defense Priorities and Allocations System Requirements.
552.211-70 [Reserved]
552.211-71 Standard References.
552.211-72 Reference to Specifications in Drawings.
552.211-73 Marking.
552.211-74 Charges for Marking.
552.211-75 Preservation, Packaging and Packing.
552.211-76 Charges for Packaging and Packing.
552.211-77 Packing List.
552.211-78 Commercial Delivery Schedule (Multiple Award Schedule).
552.211-79 Acceptable Age of Supplies.
552.211-80 Age on Delivery.
552.211-81 Time of Shipment.
552.211-82 Notice of Shipment.
552.211-83 Availability for Inspection, Testing, and Shipment/Delivery.
552.211-84 Non-Compliance With Contract Requirements.
552.212-70 Preparation of Offer (Multiple Award Schedule).
552.212-71 Contract Terms and Conditions Applicable to GSA Acquisition 
          of Commercial Items.
552.212-72 Contract Terms and Conditions Required To Implement Statutes 
          or Executive Orders Applicable to GSA Acquisition of 
          Commercial Items.
552.212-73 Evaluation--Commerical Items (Multiple Award Schedule).
552.214-70 ``All or None'' Offers.
552.214-71 Progressive Awards and Monthly Quantity Allocations.
552.214-72 Bid Sample Requirements.
552.215-70 Examination of Records by GSA.
552.215-71 Examination of Records by GSA (Multiple Award Schedule).
552.215-72 Price Adjustment--Failure To Provide Accurate Information.
552.216-70 Economic Price Adjustment--FSS Multiple Award Schedule 
          Contracts.
552.216-71 Economic Price Adjustment--Stock and Special Order Program 
          Contracts.
552.216-72 Placement of Orders.
552.216-73 Ordering Information.
552.217-70 Evaluation of Options.
552.217-71 Notice Regarding Option(s).
552.219-70 Allocation of Orders--Partially Set-Aside Items.
552.219-71 Notice to Offerors of Subcontracting Plan Requirements.
552.219-72 Preparation, Submission, and Negotiation of Subcontracting 
          Plans.
552.219-73 Goals for Subcontracting Plan.
552.219-74 Section 8(a) Direct Award.
552.223-70 Hazardous Substances.
552.223-71 Nonconforming Hazardous Materials.
552.223-72 Hazardous Material Information.
552.225-70 Notice of Procurement Restriction--Hand or Measuring Tools or 
          Stainless Steel Flatware.
552.227-70 Government Rights (Unlimited).
552.227-71 Drawings and Other Data To Become Property of Government.
552.228-70 Workers' Compensation Laws.
552.229-70 Federal, State, and Local Taxes.
552.229-71 Federal Excise Tax--DC Government.
552.232-1 Payments.
552.232-8 Discounts for Prompt Payment.
552.232-23 Assignment of Claims.
552.232-25 Prompt Payment.
552.232-70 Invoice Requirements.
552.232-71 Adjusting Payments.
552.232-72 Final Payment.
552.232-73 Availability of Funds.
552.232-74 Invoice Payments.
552.232-75 Prompt Payment.

[[Page 226]]

552.232-76 Electronic Funds Transfer Payment.
552.232-77 Payment By Governmentwide Commercial Purchase Card.
552.232-78 Payment Information.
552.232-79 Payment by Credit Card.
552.232-81 Payments by Non-Federal Ordering Activities.
552.232-82 Contractor's Remittance (Payment) Address.
552.232-83 Contractor's Billing Responsibilities.
552.233-70 Protests Filed Directly with the General Services 
          Administration.
552.233-71 Disputes (Utility Contracts).
552.236-70 Definitions.
552.236-71 Authorities and Limitations.
552.236-72 Specialist.
552.236-73 Basis of Award--Construction Contract.
552.236-74 Working Hours.
552.236-75 Use of Premises.
552.236-76 Measurements.
552.236-77 Specifications and Drawings.
552.236-78 Shop Drawings, Coordination Drawings, and Schedules.
552.236-79 Samples.
552.236-80 Heat.
552.236-81 Use of Equipment by the Government.
552.236-82 Subcontracts.
552.236-83 Requirement for a Project Labor Agreement.
552.237-70 Qualifications of Offerors.
552.237-71 Qualifications of Employees.
552.237-72 Prohibition Regarding ``Quasi-Military Armed Forces.''
552.237-73 Restriction on Disclosure of Information.
552.238-70 Identification of Electronic Office Equipment Providing 
          Accessibility for the Handicapped.
552.238-71 Submission and Distribution of Authorized FSS Schedule 
          Pricelists.
552.238-72 Identification of Products That Have Environmental 
          Attributes.
552.238-73 Cancellation.
552.238-74 Industrial Funding Fee and Sales Reporting.
552.238-75 Price Reductions.
552.238-76 Definition (Federal Supply Schedules)--Recovery Purchasing.
552.238-77 Definition (Federal Supply Schedules).
552.238-78 Scope of Contract (Eligible Ordering Activities).
552.238-79 Use of Federal Supply Schedule Contracts by Certain 
          Entities--Cooperative Purchasing.
552.238-80 Use of Federal Supply Schedule Contracts by Certain 
          Entities--Recovery Purchasing.
552.242-70 Status Report of Orders and Shipments.
552.243-70 Pricing of Adjustments.
552.243-71 Equitable Adjustments.
552.243-72 Modifications (Multiple Award Schedule).
552.246-17 Warranty of Supplies of a Noncomplex Nature.
552.246-70 Source Inspection by Quality Approved Manufacturer.
552.246-71 Source Inspection by Government.
552.246-72 Final Inspection and Tests.
552.246-73 Warranty--Multiple Award Schedule.
552.246-74 [Reserved]
552.246-75 Guarantees.
552.246-76 Warranty of Pesticides.
552.247-70 Placarding Railcar Shipments.
552.247-71 Diversion of Shipment Under F.O.B. Destination Contracts.
552.249-70 Termination for Convenience of the Government (Fixed Price) 
          (Short Form).
552.249-71 Submission of Termination Liability Schedule.
552.252-5 Authorized Deviations in Provisions.
552.252-6 Authorized Deviations in Clauses.
552.270-1 Instructions to Offerors--Acquisition of Leasehold Interests 
          in Real Property.
552.270-2 Historic Preference.
552.270-3 Parties To Execute Lease.
552.270-4 Definitions.
552.270-5 Subletting and Assignment.
552.270-6 Maintenance of Building and Premises--Right of Entry.
552.270-7 Fire and Casualty Damage.
552.270-8 Compliance with Applicable Law.
552.270-9 Inspection--Right of Entry.
552.270-10 Failure in Performance.
552.270-11 Successors Bound.
552.270-12 Alterations.
552.270-13 Proposals for Adjustment.
552.270-14 Changes.
552.270-15 Liquidated Damages.
552.270-16 Adjustment for Vacant Premises.
552.270-17 Delivery and Condition.
552.270-18 Default in Delivery--Time Extensions.
552.270-19 Progressive Occupancy.
552.270-20 Payment.
552.270-21 Effect of Acceptance and Occupancy.
552.270-22 Default by Lessor During the Term.
552.270-23 Subordination, Nondisturbance and Attornment.
552.270-24 Statement of Lease.
552.270-25 Substitution of Tenant Agency.
552.270-26 No Waiver.
552.270-27 Integrated Agreement.
552.270-28 Mutuality of Obligation.
552.270-29 Acceptance of Space.

    Authority: 40 U.S.C. 121(c).

    Source: 64 FR 37229, July 9, 1999, unless otherwise noted.

[[Page 227]]



552.000  Scope of part.

    This part provides the text of provisions and clauses which are 
unique to GSA or supplement the FAR.



       Subpart 552.1_Instructions for Using Provisions and Clauses



552.101-70  Using part 552.

    (a) Definition. ``Clause,'' as used in this subpart, means provision 
or clause as defined in FAR 52.101(a).
    (b) Numbering. (1) Clauses which are ``substantially'' the same as 
FAR clauses and clauses to be used instead of FAR clauses are identified 
as follows:
    (i) The clause has the same title as a clause in the FAR.
    (ii) The number 5 precedes the clause.
    (iii) The clause appears under the same subsection number and 
caption as in the FAR.
    (2) Supplemental clauses are numbered in the same manner as the FAR, 
except:
    (i) The chapter number precedes the clause.
    (ii) The subsection numbers begin with 70.
    (iii) The clauses are sequentially numbered, e.g., 552.232-70, 
552.232-71, etc.



552.102  Incorporating provisions and clauses.

    You may incorporate clauses prescribed in the GSAR for solicitations 
and contracts by reference.



552.103  Identification of provisions and clauses.

    Deviations. If the GSAR prescribes a class deviation from a FAR 
clause, identify the clause by the GSAR citation (e.g., 552.232-8 PROMPT 
PAYMENT DISCOUNT (NOV 1987) (DEVIATION FAR 552.232-8)).



552.104  Procedures for modifying and completing provisions and clauses.

    (a) The procedures in FAR 52.104 apply when you modify or complete a 
GSAR provision or clause. Provisions and clauses shall not be modified 
unless the GSAR authorizes their modification.
    (b) You do not need to identify modifications of clauses which 
result from negotiations unless you issue an amendment to the 
solicitation.
    (c) In general, you should modify FAR or GSAR clauses only for 
individual cases. If a contracting activity develops a modification for 
repeated use, furnish a copy to the Office of GSA Acquisition Policy 
(MV) for potential inclusion in the GSAR.



552.105  Procedures for using alternates.

    The procedures in FAR 52.105 apply to GSAR part 552.



552.107-70  Provisions and clauses prescribed in subpart 552.1.

    (a) Insert the provision at 552.252-5, Authorized Deviations in 
Provisions, in solicitation that include any FAR or GSAR clause with an 
authorized deviation. You must use this provision in lieu of the FAR 
provision at 552.252-5.
    (b) Insert the clause at 552.252-6, Authorized Deviations in 
Clauses, in solicitations and contracts that include any FAR or GSAR 
clause with an authorized deviation. You must use this clause in lieu of 
the FAR clause at 52.252-6.



              Subpart 552.2_Text of Provisions and Clauses



552.200  Scope of subpart.

    This subpart sets forth the text of all GSAR provisions and clauses. 
It also cross-references the location in the GSAR that prescribes the 
use of each provision and clause.



552.203-5  Covenant Against Contingent Fees.

    As prescribed in 502.404, insert the following clause:

              Convenant Against Contingent Fees (FEB 1990)

    (a) The Contractor warrants that no person or agency has been 
employed or retained to solicit or obtain this contract upon an 
agreement or understanding for a contingent fee, except a bona fide 
employee or agency. For breach or violation of this warrant, the 
Government shall have the right to annul this contract without liability 
or, in its discretion, to deduct from the contract price or

[[Page 228]]

consideration, or otherwise recover the full amount of the contingent 
fee.
    (b) ``Bona fide agency,'' as used in this clause, means an 
established commercial or selling agency (including licensed real estate 
agents or brokers), maintained by a Contractor for the purpose of 
securing business, that neither exerts nor proposes to exert improper 
influence to solicit or obtain Government contracts nor holds itself out 
as being able to obtain any Government contract or contracts through 
improper influence.
    ``Bona fide employee,'' as used in this clause, means a person, 
employed by a Contractor and subject to the Contractor's supervision and 
control as to time, place, and manner of performance, who neither exerts 
nor proposes to exert improper influence to solicit or obtain Government 
contracts nor holds out as being able to obtain any Government contract 
or contracts through improper influence.
    ``Contingent fee,'' as used in this clause, means any commission, 
percentage, brokerage, or other fee that is contingent upon the success 
that a person or concern has in securing a Government contract.
    ``Improper influence,'' as used in this clause, means any influence 
that induces or tends to induce a Government employee or officer to give 
consideration or to act regarding a Government contract on any basis 
other than the merits of the matter.

                             (End of clause)



552.203-70  Price Adjustment for Illegal or Improper Activity.

    As prescribed in 503.104-9, insert the following clause:

      Price Adjustment for Illegal or Improper Activity (SEP 1999)

    (a) If the head of the contracting activity (HCA) or his or her 
designee determines that there was a violation of subsection 27(a) of 
the Office of Federal Procurement Policy Act, as amended (41 U.S.C. 
423), as implemented in the Federal Acquisition Regulation, the 
Government, at its election, may--
    (1) Reduce the monthly rental under this lease by 5 percent of the 
amount of the rental for each month of the remaining term of the lease, 
including any option periods, and recover 5 percent of the rental 
already paid;
    (2) Reduce payments for alterations not included in monthly rental 
payments by 5 percent of the amount of the alterations agreement; or
    (3) Reduce the payments for violations by a Lessor's subcontractor 
by an amount not to exceed the amount of profit or fee reflected in the 
subcontract at the time the subcontract was placed.
    (b) Prior to making a determination as set forth above, the HCA or 
designee shall provide to the Lessor a written notice of the action 
being considered and the basis therefor. The Lessor shall have a period 
determined by the agency head or designee, but not less than 30 calendar 
days after receipt of such notice, to submit in person, in writing, or 
through a representative, information and argument in opposition to the 
proposed reduction. The agency head or designee may, upon good cause 
shown, determine to deduct less than the above amounts from payments.
    (c) The rights and remedies of the Government specified herein are 
not exclusive, and are in addition to any other rights and remedies 
provided by law or under this lease.

                             (End of clause)



552.203-71  Restriction on Advertising.

    As prescribed in 503.570-2, insert the following clause:

                  Restriction on Advertising (SEP 1999)

    The Contractor shall not refer to this contract in commercial 
advertising or similar promotions in such a manner as to state or imply 
that the product or service provided is endorsed or preferred by the 
White House, the Executive Office of the President, or any other element 
of the Federal Government, or is considered by these entities to be 
superior to other products or services. Any advertisement by the 
Contractor, including price-off coupons, that refers to a military 
resale activity shall contain the following statement: ``This 
advertisement is neither paid for nor sponsored, in whole or in part, by 
any element of the United States Government.''

                             (End of clause)



552.209-70  Product Removal from Qualified Products List.

    As prescribed in 509.206-2, insert the following clause:

         Product Removal From Qualified Products List (SEP 1999)

    If, during the performance of this contract, the product being 
furnished is for any reason (except those outlined in paragraph 3.1.1 of 
the applicable Federal or Interim Federal Specification for security 
cabinets, security vault doors and changeable combination padlocks) 
removed from the Qualified Products List, the Government may terminate 
this contract for default.

                             (End of clause)



552.209-71  Waiver of First Article Testing and Approval Requirement.

    As prescribed in 509.306, insert the following provision:

[[Page 229]]

   Waiver of First Article Testing and Approval Requirement (SEP 1999)

    (a) Offerors must submit an offer including testing and approval, 
however, an offeror may submit an alternate offer excluding testing and 
approval, provided the offeror satisfies the requirements for the 
waiving of first article testing.
    (b) Before a waiver of the first article testing requirement of this 
solicitation will be considered, the offeror is requested to identify 
the procurement under which the product offered was previously approved 
and accepted:

________________________________________________________________________
(Offeror to insert both contract number and applicable national stock 
number.)

                           (End of provision)



552.209-72  Supplemental Requirements for First Article Approval--Contractor Testing.

    As prescribed in 509.308-1, insert the following clause:

Supplemental Requirements for First Article Approval--Contractor Testing 
                               (SEP 1999)

    (a) The term ``Contracting Officer'' as used in FAR 52.209-3, First 
Article Approval--Contractor Testing, means the Administrative 
Contracting Officer (ACO).
    (b) The Contractor shall have either (1) the necessary inspection 
and test equipment at the Contractor's plant to perform first article 
testing, or (2) if the inspection and test equipment is not available, a 
letter of commitment from a laboratory acceptable to the Government to 
perform the inspection and testing.
    (c) When the Government elects to witness the first article testing, 
the Contractor shall conduct the testing between the hours of 7:00 AM 
and 5:00 PM, Monday thru Friday, unless a different time is agreed to by 
the ACO.
    (d) The first article test report shall contain:
    (1) The complete test data, the test method(s) used and date of 
test;
    (2) Signature and printed name of the individual who performed the 
inspection;
    (3) Applicable specification/CID and/or drawing numbers;
    (4) Name and type of test equipment used; and
    (5) All numerical values as a result of testing with each noted as 
to whether it passes or fails the contract test requirements.
    (e) The first article shall be retained by the Contractor as the 
manufacturing standard and will be kept in a secure area, under control 
of the Quality Assurance Specialist (QAS), to protest against possible 
changes or alterations for the life of the contract. If the first 
article sample is destroyed during testing or damaged to a point making 
it unusable as a standard, the Contractor, upon Government request, 
shall provide a second sample.
    (f) If the Contractor delivers the approved first article as part of 
the contract quantity, it shall be in the last scheduled delivery under 
the contract.

                             (End of clause)



552.209-73  Supplemental Requirements for First Article Approval--Government Testing.

    As prescribed in 509.308-2, insert the following clause:

Supplemental Requirements for First Article Approval--Government Testing 
                               (SEP 1999)

    (a) The term ``Contracting Officer'' as used in FAR 52.209-4, First 
Article Approval--Government Testing, means the Administrative 
Contracting Officer (ACO).
    (b) The first article shall be retained by the Contractor as the 
manufacturing standard and will be kept in a secure area, under the 
control of the Quality Assurance Specialist (QAS) to protect against 
possible changes or alterations for the life of the contract. If the 
first article sample is destroyed during testing or damaged to a point 
making it unusable as a standard, the Contractor, upon Government 
request, shall provide a second sample.
    (c) If the Contractor deliver the approved first article as part of 
the contract quantity, it shall be in the last scheduled delivery under 
the contract.

                             (End of clause)



552.211-8  Time of Delivery.

    As prescribed in 511.404(a)(1) insert the following clause:

                       Time of Delivery (SEP 1999)

    (a) The time of delivery for each item means the time required after 
receipt of an order (1) to make delivery to a destination in the case of 
delivered prices, or (2) to place shipment in transit in the case of 
f.o.b. origin prices.
    (b) Delivery is required to be made at the point(s) specified within 
------ days after receipt of order.

                             (End of clause)

    Alternate I (SEP 1999). It it is necessary to show different 
delivery times for different items or groups of items, the Contracting 
Officer may substitute

[[Page 230]]

the following paragraph (b) for paragraph (b) of the basis clause.

    (b) Delivery is required to be made at the point(s) specified within 
the number of calendar days after receipt of order as indicated below:

------------------------------------------------------------------------
   Items or groups of items  (Special Item       Required delivery time
           Numbers or Nomenclature)                    (DAYS ARO)
------------------------------------------------------------------------
                                               .........................
                                               .........................
                                               .........................
------------------------------------------------------------------------



552.211-15  Defense Priorities and Allocations System Requirements.

    As prescribed at 511.604, insert the following clause:

    Defense Priorities and Allocations System Requirements (SEP 2004)

    (a) Definitions.
    Approved program means a program determined to be necessary or 
appropriate for priorities and allocation support to promote the 
national defense by the Secretary of Defense, the Secretary of Energy, 
or the Department of Homeland Security Under Secretary for Emergency 
Preparedness and Response under the authority of the Defense Production 
Act, the Stafford Act, and Executive Order 12919, or the Selective 
Service Act and related statutes, and Executive Order 12742. See 
Schedule 1 of 15 CFR part 700 for a list of Delegate Agencies, approved 
programs, and program identification symbols at http://www.bis.doc.gov/
DefenseIndustrialBasePrograms/OSIES/DPAS/Default.htm).
    Defense Priorities and Allocations System (DPAS) means the 
regulation published at 15 CFR part 700 that requires preferential 
treatment for certain contracts and orders placed by a Delegate Agency 
in support of an approved program.
    Delegate Agency means an agency of the U.S. Government authorized by 
delegation from the Department of Commerce (DOC) to place priority 
ratings on contracts or orders needed to support approved programs.
    Rated order means, for the purpose of this contract, a delivery or 
task order issued in accordance with the provisions of the DPAS 
regulation (15 CFR part 700).
    (b) Rated Order Requirement. From time to time, the Contractor may 
receive a rated order under this contract from a Delegate Agency. The 
Contractor must give preferential treatment to rated orders as required 
by the Defense Priorities and Allocations System (DPAS) regulation (15 
CFR part 700). The existence of previously accepted unrated or lower 
rated orders is not sufficient reason to reject a rated order. Rated 
orders take preference over all unrated orders as necessary to meet 
required delivery dates. There are two levels of ratings designated by 
the symbol of either ``DO'' or ``DX.'' All ``DO'' rated orders have 
equal priority with each other and take preference over unrated orders. 
All ``DX'' rated orders have equal priority with each other and take 
preference over ``DO'' rated orders and unrated orders. The rating 
designation is followed by a program identification symbol. Program 
identification symbols indicate which approved program is supported by 
the rated order (see Schedule 1 of 15 CFR part 700 for a list of 
Delegate Agencies, approved programs, and program identification 
symbols).
    (c) Additional information. Additional information may be obtained 
at the DOC DPAS website http://www.bis.doc.gov/
DefenseIndustrialBasePrograms/OSIES/DPAS/Default.htm or by contacting 
the designated Administrative Contracting Officer.

[69 FR 55935, Sept. 16, 2004]



552.211-70  [Reserved]



552.211-71  Standard References.

    As prescribed in 511.204(a), insert the following clause:

                     Standard References (SEP 1999)

    (a) All documents and publications (such as, but not limited to, 
manuals, handbooks, codes, standards and specifications) cited in this 
contract for the purpose of establishing requirements applicable to 
equipment, materials, or workmanship under this contract, shall be 
deemed to be incorporated herein as fully as if printed and bound with 
the specifications of this contract, in accordance with the following:
    (1) Wherever reference is made to Standard Specifications of the 
Public Buildings Service, Interim Federal Specifications, Interim 
Amendments to Federal Specifications, Interim Federal Standards, or 
Interim Amendments to Federal Standards, the Contractor shall comply 
with the requirements set out in the issue or edition identified in this 
contract.
    (2) Wherever reference is made to any such document other than those 
specified in subparagraph (1) above, the Contractor shall comply with 
the requirements set out in the edition specified in this contract, or 
if not specified, the latest edition or revision thereof, as well as the 
latest amendment or supplement thereto, in effect on the date of the 
solicitation on this project, except as modified by, as otherwise 
provided in, or as limited to type, class or grade, by the 
specifications of this contract.
    (b) Upon request the Contractor shall make available at the job site 
within a reasonable time, a copy of each trade manual

[[Page 231]]

and standard which is incorporated by reference in this contract and 
which governs quality and workmanship.

                             (End of clause)



552.211-72  Reference to Specifications in Drawings.

    As prescribed in 511.204(b), insert the following clause:

           References to Specifications in Drawings (FEB 1996)

    If military or other drawings are made a part of this contract, any 
reference in the drawings to Federal specifications or standards will be 
considered to be a reference to the date of such Federal specification 
or standard identified in the contract. If the date of the Federal 
specification or standard is not identified in the contract, the 
edition, including revisions thereto, in effect on the date the 
solicitation is issued will apply.

                             (End of clause)



552.211-73  Marking.

    As prescribed in 511.204(c)(1), insert the following clause:

                           Marking (FEB 1996)

    (a) General requirements. Interior packages, if any, and exterior 
shipping containers shall be marked as specified elsewhere in the 
contract. Additional marking requirements may be specified on delivery 
orders issued under the contract. If not otherwise specified, interior 
packages and exterior shipping containers shall be marked in accordance 
with the following standards:
    (1) Deliveries to civilian activities. Supplies shall be marked in 
accordance with Federal Standard 123, edition in effect on the date of 
issuance of the solicitation.
    (2) Deliveries to military activities. Supplies shall be marked in 
accordance with Military Standard 129, edition in effect on the date of 
issuance of the solicitation.
    (b) Improperly marked material. When Government inspection and 
acceptance are at destination, and delivered supplies are not marked in 
accordance with contract requirements, the Government has the right, 
without prior notice to the Contractor, to perform the required marking, 
by contract or otherwise, and charge the Contractor therefor at the rate 
specified elsewhere in this contract. This right is not exclusive, and 
is in addition to other rights or remedies provided for in this 
contract.

                             (End of clause)



552.211-74  Charges for Marking.

    As prescribed in 511.204(c)(2), insert a clause substantially as 
follows:

                     Charges for Marking (FEB 1996)

    The rate provided for in paragraph (b) of 552.211-73, Marking, is 
$--------* per man-hour or fraction thereof.

                             (End of clause)

    * The rate to be inserted in the above clause shall be determined 
and published by the Commissioner, Federal Supply Service, or a 
designee.



552.211-75  Preservation, Packaging and Packing.

    As prescribed in 511.204(c)(3), insert the following clause:

             Preservation, Packaging, and Packing (FEB 1996)

    Unless otherwise specified, all items shall be preserved, packaged, 
and packed in accordance with normal commercial practices, as defined in 
the applicable commodity specification. Packaging and packing shall 
comply with the requirements of the Uniform Freight Classification and 
the National Motor Freight Classification (issue in effect at time of 
shipment) and each shipping container of each item in a shipment shall 
be of uniform size and content, except for residual quantities. Where 
special or unusual packing is specified in an order, but not 
specifically provided for by the contract, such packing details must be 
the subject of an agreement independently arrived at between the 
ordering agency and the Contractor.

                             (End of clause)

    Alternate I (MAY 2003). As prescribed at 511.204(c)(3), insert the 
following sentence in place of the last sentence of the clause:

    Where special or unusual packing is specified in an order, but not 
specifically provided for by the contract, such packing details must be 
the subject of an agreement independently arrived at between the 
ordering activity and the Contractor.

[64 FR 37229, July 9, 1999, as amended at 68 FR 24379, May 7, 2003]



552.211-76  Charges for Packaging and Packing.

    As prescribed in 511.204(c)(4), insert a clause substantially as 
follows:

[[Page 232]]

              Charges for Packaging and Packing (FEB 1996)

    If supplies shipped to a GSA wholesale distribution center are not 
packaged and packed in accordance with contract requirements, the 
Government has the right, without prior notice to the Contractor, to 
perform the required repackaging/repacking, by contract or otherwise, 
and charge the Contractor therefore at the rate of $----*---- per man-
hour or fraction thereof. The Contractor will also be charged for 
material costs, if incurred. This right is not exclusive, and is in 
addition to other rights or remedies provided for in this contract.

                             (End of clause)

    * The rate to be inserted in the above clause shall be determined by 
the Commissioner, Federal Supply Service, or a designee.



552.211-77  Packing List.

    As prescribed in 511.204(d), insert the following clause:

                         Packing List (FEB 1996)

    (a) A packing list or other suitable shipping document shall 
accompany each shipment and shall indicate:
    (1) Name and address of the consignor;
    (2) Name and complete address of the consignee;
    (3) Government order or requisition number;
    (4) Government bill of lading number covering the shipment (if any); 
and
    (5) Description of the material shipped, including item number, 
quantity, number of containers, and package number (if any).
    (b) When payment will be made by Government commercial credit card, 
in addition to the information in (a) above, the packing list or 
shipping document shall include:
    (1) Cardholder name and telephone number and
    (2) The term ``Credit Card.''

                             (End of clause)

    Alternate I (MAY 2003). As prescribed at 511.204(d), substitute the 
following paragraphs (a)(3) and (b) for (a)(3) and (b) of the basic 
clause:

    (a)(3) Ordering activity order or requisition number;
    (b) When payment will be made by Ordering activity commercial credit 
card, in addition to the information in (a) above, the packing list or 
shipping document shall include:
    (1) Cardholder name and telephone number; and
    (2) The term ``Credit Card.''

[64 FR 37229, July 9, 1999, as amended at 68 FR 24379, May 7, 2003]



552.211-78  Commercial Delivery Schedule (Multiple Award Schedule).

    As prescribed in 511.404(a)(2), insert the following clause:

    Commercial Delivery Schedule (Multiple Award Schedule) (FEB 1996)

    (a) Time of Delivery. The Contractor shall deliver to destination 
within the number of calendar days after receipt of order (ARO) in the 
case of F.O.B. Destination prices, or to place of shipment in transit in 
the case of F.O.B. Origin prices, as set forth below. Offerors shall 
insert in the ``Time of Delivery (days ARO)'' column in the schedule of 
Items a definite number of calendar days within which delivery will be 
made. In no case shall the offered delivery time exceed the Contractor's 
normal commercial practice. The Government requires the Contractor's 
normal commercial delivery time, as long as it is less than the 
``STATED'' delivery time(s) shown below. If the Offeror does not insert 
a delivery time in the schedule of items, the Offeror will be deemed to 
offer delivery in accordance with the Government's stated delivery time 
as stated below:

------------------------------------------------------------------------
                                              Government's  Contractor's
                                                 stated        normal
   Items or group of items  (Special Item       delivery     commercial
           Number or Nomenclature)             time  (days    delivery
                                                  ARO)          time
------------------------------------------------------------------------
                                              ............  ............
                                              ............  ............
                                              ............  ............
------------------------------------------------------------------------

    (b) Expedited Delivery Times. For those items that can be delivered 
quicker than the delivery times in paragraph (a), above, the Offeror is 
requested to insert below, a time (hours/days ARO) that delivery can be 
made when expedited delivery is requested.

------------------------------------------------------------------------
                                                              Expedited
                                                               delivery
      Item or group of items  (Special Item Number or            time
                       Nomenclature)                         (HOURS/DAYS
                                                                 ARO)
------------------------------------------------------------------------
                                                             ...........
                                                             ...........
                                                             ...........
------------------------------------------------------------------------

    (c) Overnight and 2-Day Delivery Times. Ordering activities may 
require overnight or 2-day delivery. The Offeror is requested to 
annotate its price list or by separate attachment identify the items 
that can be delivered overnight or within 2 days. Contractors offering 
such delivery services will be required to state in the cover sheet to 
its FSS price list details concerning this service.

[[Page 233]]

                             (End of clause)



552.211-79  Acceptable Age of Supplies.

    As prescribed in 511.404(a)(3)(i), insert the following clause:

                  Acceptable Age of Supplies (FEB 1996)

    The supplies furnished under this contract shall not be more than --
-- months old, beginning with the first full month after the date of 
manufacture marked on the container. For the purpose of this clause, 
supplies shall be considered to be furnished (1) when they are offered 
to the Government for inspection and testing, or (2) on the date of 
shipment if shipment is authorized to be made without prior inspection 
by the Government. If the age of the supplies furnished under this 
contract is greater than the specified period, the Government may 
exercise its right to reject the supplies.

                             (End of clause)

    Alternate I (FEB 1996). For items having a limited shelf-life, the 
sentence below should be substituted for the first sentence of the basic 
clause when authorized:

    The supplies furnished under this contract shall not be more than --
-- days old, beginning with the date of manufacture (month, day, year) 
marked on the container.



552.211-80  Age on Delivery.

    As prescribed in 511.404(a)(3)(ii) insert the following clause:

                       Age on Delivery (FEB 1996)

    Included in the description of each shelf-life item is a statement 
regarding the ``age on delivery.'' The age of the item(s) shall not 
exceed the number of months shown in the item description, counted from 
the first day of the month after the month of manufacture to the date of 
delivery to the specified delivery point(s). If the age of the supplies 
delivered under this contract is greater than the number of months 
shown, the Government may exercise its right to reject the supplies.

                             (End of clause)



552.211-81  Time of Shipment.

    As prescribed in 511.404(a)(4), insert the following clause:

                       Time of Shipment (FEB 1996)

    Shipment is required within ------ calendar days after receipt of 
order.

                             (End of clause)

    Alternate I (FEB 1996). If the contract will require shipment more 
than 45 calendar days after receipt of the order, the following 
paragraph should be added to the basic clause.

    Each delivery order will specify that shipment is required no later 
than the number of days shown above. If such order also states that 
``Early Shipment is Precluded,'' the Contractor agrees to make shipment 
no sooner than ------ calendar days after receipt of order. Earlier 
shipments may result in nonacceptance of the supplies at the delivery 
point at the time of arrival.

    (The second number to be inserted should be 15 calendar days less 
than the first number.)



552.211-82  Notice of Shipment.

    As prescribed in 511.404(a)(5), insert the following clause:

                      Notice of Shipment (FEB 1996)

    If specified in an order placed under this contract, the Contractor 
shall, at the time each shipment is made on such order, furnish a notice 
of shipment to either the consignee or the ordering office or both, as 
specified. This requirement may be satisfied by completion and return of 
appropriate forms furnished by the ordering office or by the furnishing 
of copies of bills of lading, freight bills, or similar documents in 
accordance with normal commercial practice if such document clearly 
identifies the order number, items and quantities shipped, date of 
shipment, point of origin, method of shipment and routing, and the name 
of initial carrier.

                             (End of clause)



552.211-83  Availability for Inspection, Testing, and Shipment/Delivery.

    As prescribed in 511.404(a)(6), insert the following clause:

 Availability for Inspection, Testing, and Shipment/Delivery (FEB 1996)

    (a) The Government requires that the supplies be made available for 
inspection and testing within --------*-------- calendar days after 
receipt of [Insert ``Notice of Award'' or ``order''], and be [Insert 
``shipped'' or ``delivered''] within --------*-------- calendar days 
after receipt of (1) notice of approval and release by the Government 
inspector or (2) authorization to ship without Government inspection.
    (b) Failure to make supplies available for inspection and testing or 
to [Insert ``ship'' or

[[Page 234]]

``deliver''] as required by this clause may result in termination of 
this contract for default.

                             (End of clause)

    Alternate I (FEB 1996). If the contract is for stock items, the 
Contracting Officer shall insert ``shipped'' or ``ship'' in the basic 
clause, add the following paragraph (b) and redesignate paragraph (b) of 
the basic clause as paragraph (c).

    (b) If notice of approval and release by the Government inspector or 
authorization to ship without Government inspection is received before 
--------*-------- calendar days after receipt of the [Insert ``Notice of 
Award'' or ``order''], receipt of such notice shall be deemed to be 
received on the --------*-------- calendar day after receipt of [Insert 
``Notice of Award'' or ``order'']. Shipments shall not be made before 
the --------*-------- calendar day after receipt of the [Insert ``Notice 
of Award'' or ``order''] unless authorized in writing by the Contracting 
Officer.
    * Entries are normally the same number of days specified for 
availability.



552.211-84  Non-Compliance With Contract Requirements.

    As prescribed in 511.404(b), insert the following clause:

          Non-Compliance With Contract Requirements (FEB 1996)

    In the event the Contractor, after receiving written notice from the 
Contracting Officer of non-compliance with any requirement of this 
contract, fails to initiate promptly such action as may be appropriate 
to comply with the specified requirement within a reasonable period of 
time, the Contracting Officer shall have the right to order the 
Contractor to stop any or all work under the contract until the 
Contractor has complied or has initiated such action as may be 
appropriate to comply within a reasonable period of time. The Contractor 
will not be entitled to any extension of contract time or payment for 
any costs incurred as a result of being ordered to stop work for such 
cause.

                             (End of clause)



552.212-70  Preparation of Offer (Multiple Award Schedule).

    As prescribed in 512.301(a)(1), insert the following clause:

        Preparation of Offer (Multiple Award Schedule) (AUG 1997)

    (a) Definitions. Concession, as used in this solicitation, means a 
benefit, enhancement or privilege (other than a discount), which either 
reduces the overall cost of a customer's acquisition or encourages a 
customer to consummate a purchase. Concessions include, but are not 
limited to freight allowance, extended warranty, extended price 
guarantees, free installation and bonus goods.
    Discount, as used in this solicitation, means a reduction to catalog 
prices (published or unpublished). Discounts include, but are not 
limited to, rebates, quantity discounts, purchase option credits, and 
any other terms or conditions other than concessions) which reduce the 
amount of money a customer ultimately pays for goods or services ordered 
or received. Any net price lower than the list price is considered a 
``discount'' by the percentage difference from the list price to the net 
price.
    (b) For each Special Item Number (SIN) included in an offer, the 
Offeror shall provide the information outlined in paragraph (c). 
Offerors may provide a single response covering more than one SIN, if 
the information disclosed is the same for all products under each SIN. 
If discounts and concessions vary by model or product line, offerors 
shall ensure that information is clearly annotated as to item or items 
referenced.
    (c) Provide information described below for each SIN:
    (1) Two copies of the offeror's current published (dated or 
otherwise identified) commercial descriptive catalogs and/or price 
list(s) from which discounts are offered. If special catalogs or price 
lists are printed for the purpose of this offer, such descriptive 
catalogs or price lists shall include a statement indicating the special 
catalog or price list represent a verbatim extract from the Offeror's 
commercial catalog and/or price list and identify the descriptive 
catalog and/or price list from which the information has been extracted.
    (2) Next to each offered item in the commercial catalog and/or price 
list, the Offeror shall write the special item number (SIN) under which 
the item is being offered. Unless a special catalog or price list is 
submitted, all other items shall be marked ``excluded,'' lined out, and 
initiated by the offeror.
    (3) The discount(s) offered under this solicitation. The description 
of discounts offered shall include all discounts, such as prompt payment 
discounts, quantity/dollar volume discounts (indicate whether models/
products can be combined within the SIN or whether SINs can be combined 
to earn discounts), blanket purchase agreement discounts, or purchase 
option credits. If the terms of sale appearing in the commercial 
catalogs or

[[Page 235]]

price list on which an offer is based are in conflict with the terms of 
this solicitation, the latter shall govern.
    (4) A description of concessions offered under this solicitation 
which are not granted to other customers. Such concessions may include, 
but are not limited to, an extended warranty, a return/exchange goods 
policy, or enhanced or additional services.
    (5) If the Offeror is a dealer/reseller or the Offeror will use 
dealers to perform any aspect of contract awarded under this 
solicitation, describe the functions, if any, that the dealer/reseller 
will perform.

                             (End of clause)



552.212-71  Contract Terms and Conditions Applicable to GSA Acquisition of Commercial Items.

    As prescribed in 512.301(a)(2), insert the following clause:

     Contract Terms and Conditions Applicable to GSA Acquisition of 
                       Commercial Items (JUL 2003)

    The Contractor agrees to comply with any provision or clause that is 
incorporated herein by reference to implement agency policy applicable 
to acquisition of commercial items or components. The provision or 
clause in effect based on the applicable regulation cited on the date 
the solicitation is issued applies unless otherwise stated herein. The 
following provisions and clauses are incorporated by reference:

[The contracting officer should either check the provisions and clauses 
that apply or delete the provisions and clauses that do not apply from 
the list. The contracting officer may add the date of the provision or 
clause if desired for clarity.]
    (a) Provisions.

---- 552.237-70 Qualifications of Offerors

    (b) Clauses.

---- 552.203-71 Restriction on Advertising
---- 552.211-73 Marking
---- 552.2215-70 Examination of Records by GSA
---- 552.215-71 Examination of Records by GSA (Multiple Award Schedule)
---- 552.215-72 Price Adjustment--Failure to Provide Accurate 
Information
---- 552.219-70 Allocation of Orders--Partially Set-Aside Items
---- 552.228-70 Workers' Compensation Laws
---- 552.229-70 Federal, State, and Local Taxes
---- 552.232-8 Discounts for Prompt Payment
---- 552.232-23 Assignment of Claims
---- 552.232-71 Adjusting Payments
---- 552.232-72 Final Payment
---- 552.232-73 Availability of Funds
---- 552.232-78 Payment Information
---- 552.237-71 Qualifications of Employees
---- 552.238-71 Submission and Distribution of Authorized FSS Schedule 
Price List
---- 552.238-74 Industrial Funding Fee and Sales Reporting
---- 552.238-75 Price Reductions
---- 552.242-70 Status Report of Orders and Shipments
---- 552.243-72 Modifications (Multiple Award Schedule)
---- 552.246-73 Warranty--Multiple Award Schedule
---- 552.246-76 Warranty of Pesticides

                             (End of clause)

[64 FR 37229, July 9, 1999, as amended at 65 FR 41379, July 5, 2000; 68 
FR 41288, July 11, 2003]



552.212-72  Contract Terms and Conditions Required To Implement Statutes or Executive Orders Applicable to GSA Acquisition of Commercial Items.

    As prescribed in 512.301(a)(3), insert the following clause:

    Contract Terms and Conditions Required To Implement Statutes or 
Executive Orders Applicable to GSA Acquisition of Commercial Items (SEPT 
                                  2003)

    The Contractor agrees to comply with any provision or clause that is 
incorporated herein by reference to implement provisions of law or 
Executive Orders applicable to acquisition of commercial items or 
components. The provision or clause in effect based on the applicable 
regulation cited on the date the solicitation is issued applies unless 
otherwise stated herein. The following provisions and clauses are 
incorporated by reference:

[The contracting officer should either check the provisions and clauses 
that apply or delete the provisions and clauses that do not apply from 
the list. The contracting officer may add the date of the provision or 
clause if desired for clarity.]
    (a) Provisions.

---- 552.223-72 Hazardous Material Information

    (b) Clauses.

---- 552.223-70 Hazardous Substances
---- 552.223-71 Nonconforming Hazardous Material
---- 552.238-70 Identification of Electronic Office Equipment Providing 
Accessibility for the Handicapped
---- 552.238-72 Identification of Products That Have Environmental 
Attributes

[[Page 236]]

                             (End of clause)

[64 FR 37229, July 9, 1999, as amended at 65 FR 41379, July 5, 2000; 68 
FR 41288, July 11, 2003; 68 FR 52128, Sept. 2, 2003]



552.212-73  Evaluation--Commercial Items (Multiple Award Schedule).

    As prescribed in 512.301(a)(4), insert the following provision:

    Evaluation--Commercial Items (Multiple Award Schedule) (AUG 1997)

    (a) The Government may make multiple awards for the supplies or 
services offered in response to this solicitation that meet the 
definition of a ``commercial item'' in FAR 52.202-1. Awards may be made 
to those responsible offerors that offer reasonable pricing, conforming 
to the solicitation, and will be most advantageous to the Government, 
taking into consideration the multiplicity and complexity of items of 
various manufacturers and the differences in performance required to 
accomplish or produce required end results, production and distribution 
facilities, price, compliance with delivery requirements, and other 
pertinent factors. By providing a selection of comparable supplies or 
services, ordering activities are afforded the opportunity to fulfill 
their requirements with the item(s) that constitute the best value and 
that meet their needs at the lowest overall cost.
    (b) A written notice of award or acceptance of an offer, mailed or 
otherwise furnished to the offeror within the time for acceptance 
specified in the offer, shall result in a binding contract without 
further action by either party. Before the offer's specified expiration 
time, the Government may accept an offer (or part of an offer), whether 
or not there are negotiations after its receipt, unless a written notice 
of withdrawal is received before award.

                           (End of provision)

    Alternate I (AUG 1997). When anticipating competition of identical 
items, add the following paragraph after paragraph (b) of the basic 
provision.

    (c) The Government reserves the right to award only one contract for 
all or a part of a manufacturer's product line. When two or more 
offerors (e.g., dealers/resellers) offer the identical product, award 
may be made competitively to only one offeror on the basis of the lowest 
price. (Discounts for early payment will not be considered as an 
evaluation factor in determining the low offeror). During initial open 
season for an option period, any offers that are equal to or lower than 
the current contract price received for identical items will be 
considered. Current contractors will also be allowed to submit offers 
for identical items during this initial open season. The current 
contractor which has the identical item on contract will be included in 
the evaluation process. The Government will evaluate all offers and may 
award only one contract for each specified product or aggregate group.



552.214-70  ``All or None'' Offers.

    As prescribed in 514.201-6, insert the following provision:

                    ``All or None'' Offers (SEP 1999)

    (a) Unless awards in the aggregate are specifically precluded in 
this solicitation, the Government reserves the right to evaluate offers 
and make awards on all ``all or none'' basis as provided below.
    (b) An offer submitted on an ``all or none'' or similar basis will 
be evaluated as follows: The lowest acceptable offer exclusive of the 
``all or none'' offer will be selected with respect to each item (or 
group of items when the solicitation provides for aggregate awards) and 
the total cost of all items thus determined shall be compared with the 
total of the lowest acceptable ``all or none'' offer. Award will be made 
to result in the lowest total cost to the Government.

                           (End of provision)

    Alternate I (SEP 1999). For a requirements or indefinite quantity 
contract, the following paragraph (b) shall be substituted in the basic 
provision:

    (b) An offer submitted on an ``all or none'' or similar basis will 
not be considered unless the offer is low on each item to which the 
``all or none'' offer is made applicable. The term ``each item'' as used 
in this provision refers either to an item that under the terms of the 
solicitation may be independently awarded, or to a group of items on 
which an award is to be made in the aggregate.



552.214-71  Progressive Awards and Monthly Quantity Allocations.

    As prescribed in 514.201-7(a), insert the following clause:

     Progressive Awards and Monthly Quantity Allocations (SEP 1999)

    (a) Monthly quantity allocation.
    (1) Set forth below are the Government's estimated annual and 
monthly requirements for each stock item covered by this solicitation. 
Offerors shall indicate, in the spaces provided, the monthly quantity 
which they are willing to furnish of any item or group of items 
involving the use of the same production facilities. In making monthly 
allocations, offerors are urged to group as many

[[Page 237]]

items as possible. Such groupings will make it possible for the 
Government to make fullest use of the production capabilities of each 
offeror.
    (2) Offerors need not limit their monthly allocations to the 
Government's estimated monthly requirements, since additional 
unanticipated needs may occur during the period of the contract. If an 
offeror does not insert monthly allocation quantities, it will be deemed 
to offer to furnish all of the Government's requirements, even though 
they may exceed the stated estimated requirements.

------------------------------------------------------------------------
                                   Estimated annual    Estimated monthly
     National stock number           requirements        requirements
------------------------------------------------------------------------
                                 ...................
                                 ...................
------------------------------------------------------------------------


                  Bidders Monthly Quantity Allocations
------------------------------------------------------------------------
                                                  Monthly allocation
          Items or groups of items                     quantity
------------------------------------------------------------------------
                                              ..........................
                                              ..........................
------------------------------------------------------------------------

    (b) Progressive awards. If the low responsive offeror's monthly 
quantity allocation is less than the Government's estimated 
requirements, the Government may make progressive awards beginning with 
the low responsive offeror and including each next low responsive 
offeror to the extent necessary to meet the estimated requirements.
    (c) Ordering procedures. If progressive awards are made, orders will 
be placed first with the Contractor offering the lowest price on each 
item normally up to that Contractor's maximum quantity allocation and 
then, in the same manner, successively to other Contractors. When 
cumulative orders during any month, placed with a lower priced 
Contractor, equal or exceed 95 percent of its monthly quantity 
allocation, to avoid the placement of unduly small orders or the 
splitting of a subsequent order, the Government reserves the right to 
award the full quantity of the subsequent order to the next lower priced 
Contractor. In no case will orders be placed with any Contractor in 
excess of its monthly quantity allocation.

                             (End of clause)



552.214-72  Bid Sample Requirements.

    As prescribed in 514.202-4(a)(3), insert the following provision:

                   Bid Sample Requirements (SEP 1999)

    This provision supplements FAR 52.214-20, which is incorporated by 
reference. Samples shall be from the production of the manufacturer 
whose products will be supplied under resultant contracts.
    (a) Two bid samples are required for each of the following items in 
this solicitation:

________________________________________________________________________
    (b) Two representative samples shall be submitted for each of the 
following items upon which a bid is submitted:

------------------------------------------------------------------------
                                            Acceptable representative
                 Items                               samples
------------------------------------------------------------------------
                                         ...............................
                                         ...............................
------------------------------------------------------------------------

    Note: (1) Bidders [squ] are or [squ] are not authorized to re-apply 
samples being retained by GSA in connection with previous solicitations 
and/or resultant contracts. When the block ``are'' is marked by the 
government, FAR 52.214-20, Alternate II, shall apply.
    (2) Bidders who propose to furnish an item or group of items from 
more than one manufacturer or production point must submit two samples 
from the production of each manufacturer or production point.
    (c) Samples will be evaluated to determine compliance with all 
characteristics listed below:

------------------------------------------------------------------------
        Subjective characteristics            Objective characteristics
------------------------------------------------------------------------
                                            ............................
                                            ............................
------------------------------------------------------------------------

    (d) Forward samples addressed to the Sample Room indicated below. 
Except for samples delivered by U.S. Mail, deliveries will be accepted 
between the hours of -------------------- Mondays through Fridays, 
official holidays excluded.
    Caution: Use proper address for method of shipment selected.

Mail and Parcel Post
(Insert Address of Bid Sample Room)
Freight or Express
(Insert address of Bid Sample Room)

                           (End of provision)



552.215-70  Examination of Records by GSA.

    As prescribed in 514.201-7(b) and 515.209-70(a) insert the following 
clause:

                Examination of Records by GSA (FEB 1996)

    The Contractor agrees that the Administrator of General Services or 
any duly authorized representatives shall, until the expiration of 3 
years after final payment under this contract, or of the time periods 
for the particular records specified in Subpart 4.7 of the Federal 
Acquisition Regulation (48 CFR 4.7), whichever expires earlier, have 
access to and the right to examine any books, documents, papers, and 
records of the Contractor

[[Page 238]]

involving transactions related to this contract or compliance with any 
clauses thereunder. The Contractor further agrees to include in all its 
subcontracts hereunder a provision to the effect that the subcontractor 
agrees that the Administrator of General Services or any authorized 
representatives shall, until the expiration of 3 years after final 
payment under the subcontract, or of the time periods for the particular 
records specified in Subpart 4.7 of the Federal Acquisition Regulation 
(48 CFR 4.7), whichever expires earlier, have access to and the right to 
examine any books, documents, papers, and records of such subcontractor 
involving transactions related to the subcontract or compliance with any 
clauses thereunder. The term ``subcontract'' as used in this clause 
excludes (a) purchase orders not exceeding $100,000 and (b) subcontracts 
or purchase orders for public utility services at rates established for 
uniform applicability to the general public.

                             (End of clause)



552.215-71  Examination of Records by GSA (Multiple Award Schedule).

    As prescribed in 515.209-70(c), insert the following clause:

   Examination of Records by GSA (Multiple Award Schedule) (JULY 2003)

    The Contractor agrees that the Administrator of General Services or 
any duly authorized representative shall have access to and the right to 
examine any books, documents, papers and records of the contractor 
involving transactions related to this contract for overbillings, 
billing errors, compliance with the Price Reduction clause and 
compliance with the Industrial Funding Fee and Sales Reporting clause of 
this contract. This authority shall expire 3 years after final payment. 
The basic contract and each option shall be treated as separate 
contracts for purposes of applying this clause.

                             (End of clause)

[64 FR 37229, July 9, 1999, as amended at 68 FR 41288, July 11, 2003]



552.215-72  Price Adjustment--Failure To Provide Accurate Information.

    As prescribed in 515.408(d), insert the following clause:

  Price Adjustment--Failure To Provide Accurate Information (AUG 1997)

    (a) The Government, at its election, may reduce the price of this 
contract or contract modification if the Contracting Officer determines 
after award of this contract or contract modification that the price 
negotiated was increased by a significant amount because the Contractor 
failed to:
    (1) Provide information required by this solicitation/contract or 
otherwise requested by the Government; or
    (2) Submit information that was current, accurate, and complete; or
    (3) Disclose changes in the Contractor's commercial pricelist(s), 
discounts or discounting policies which occurred after the original 
submission and prior to the completion of negotiations.
    (b) The Government will consider information submitted to be 
current, accurate and complete if the data is current, accurate and 
complete as of 14 calendar days prior to the date it is submitted.
    (c) If any reduction in the contract price under this clause reduces 
the price for items for which payment was made prior to the date of the 
modification reflecting the price reduction, the Contractor shall be 
liable to and shall pay the United States--
    (1) The amount of the overpayment; and
    (2) Simple interest on the amount of such overpayment to be computed 
from the date(s) of overpayment to the Contractor to the date the 
Government is repaid by the Contractor at the applicable underpayment 
rate effective each quarter prescribed by the Secretary of Treasury 
under 26 U.S.C. 6621(a)(2).
    (d) Failure to agree on the amount of the decrease shall be resolved 
as a dispute.
    (e) In addition to the remedy in paragraph (a) of this clause, the 
Government may terminate this contract for default. The rights and 
remedies of the Government specified herein are not exclusive, and are 
in addition to any other rights and remedies provided by law or under 
this contract.

                             (End of clause)



552.216-70  Economic Price Adjustment--FSS Multiple Award Schedule Contracts.

    As prescribed in 516.203-4(a), insert the following clause:

 Economic Price Adjustment--FSS Multiple Award Schedule Contracts (SEP 
                                  1999)

    Price adjustments include price increases and price decreases. 
Adjustments will be considered as follows:
    (a) Contractors shall submit price decreases anytime during the 
contract period in which they occur. Price decreases will be handled in 
accordance with the provisions of the Price Reduction Clause.
    (b) Contractors may request price increases under the following 
conditions:

[[Page 239]]

    (1) Increases resulting from a reissue or other modification of the 
Contractor's commercial catalog/pricelist that was used as the basis for 
the contract award.
    (2) Only three increases will be considered during the contract 
period.
    (3) Increases are requested after the first 30 days of the contract 
period and prior to the last 60 days of the contract period.
    (4) At least 30 days elapse between requested increases.
    (c) The aggregate of the increases in any contract unit price under 
this clause shall not exceed ------* percent of the original contract 
unit price. The Government reserves the right to raise this ceiling 
where changes in market conditions during the contract period support an 
increase.
    (d) The following material shall be submitted with the request for a 
price increase:
    (1) A copy of the commercial catalog/pricelist showing the price 
increase and the effective date for commercial customers.
    (2) Commercial Sales Practice format regarding the Contractor's 
commercial pricing practice relating to the reissued or modified 
catalog/price-list, or a certification that no change has occurred in 
the data since completion of the initial negotiation or a subsequent 
submission.
    (3) Documentation supporting the reasonableness of the price 
increase.
    (e) The Government reserves the right to exercise one of the 
following options:
    (1) Accept the Contractor's price increases as requested when all 
conditions of (b), (c), and (d) of this clause are satisfied;
    (2) Negotiate more favorable discounts from the new commercial 
prices when the total increase requested is not supported; or,
    (3) Remove the product(s) from contract involved pursuant to the 
Cancellation Clause of this contract, when the increase requested is not 
supported.
    (f) The contract modification reflecting the price adjustment shall 
be signed by the Government and made effective upon receipt of 
notification from the Contractor that the new catalog/pricelist has been 
mailed to the addresses previously furnished by the Contracting Officer, 
provided that in no event shall such price adjustment be effective prior 
to the effective date of the commercial price increases. The increased 
contract prices shall apply to delivery orders issued to the Contractor 
on or after the effective date of the contract modification.

                             (End of clause)

    * Insert the percent appropriate at the time the solicitation is 
issued. This percentage should normally be 10 percent, unless based on a 
trend established by an appropriate index such as the Producer Prices 
and Price Index during the most recent 6-month period indicates that a 
different percentage is more appropriate. Any ceiling other than 10 
percent must be approved by the contracting director.
    Alternate I (SEP 1999). The following is substituted for paragraphs 
(b) and (c) of the clause:

    (b) Contractors may request price increases to be effective on or 
after the first 12 months of the contract period providing all of the 
following conditions are met:
    (1) Increases resulting from a reissue or other modification of the 
Contractor's commercial catalog/pricelist that was used as the basis for 
the contract award.
    (2) No more than three increases will be considered during each 
succeeding 12-month period of the contract. (For succeeding contract 
periods of less than 12 months, up to three increases will be considered 
subject to the other conditions of this subparagraph (b)).
    (3) Increases are requested before the last 60 days of the contract 
period.
    (4) At least 30 days elapse between requested increases.
    (c) In any contract period during which price increases will be 
considered, the aggregate of the increases during any 12-month period 
shall not exceed *-------- percent of the contract unit price in effect 
at the end of the preceding 12-month period. The Government reserves the 
right to raise the ceiling when market conditions during the contract 
period support such a change.
    * Insert the percentage appropriate at the time the solicitation is 
issued. This percentage should be determined based on the trend 
established by an appropriate index such as the Producer Prices and 
Price Index. A ceiling of more than 10 percent must be approved by the 
Contracting Director.

[64 FR 37229, July 9, 1999; 64 FR 49844, Sept. 14, 1999]



552.216-71  Economic Price Adjustment--Stock and Special Order Program Contracts.

    As prescribed in 516.203-4(b), insert the following clause:

Economic Price Adjustment-Stock and Special Order Program Contracts (SEP 
                                  1999)

    (a) ``Producer Price Index'' (PPI), as used in this clause, means 
the originally released index, not seasonally adjusted, published by the 
Bureau of Labor Statistics, U.S. Department of Labor (Labor) for product 
code -------- found under Table --------.
    (b) During the term of the contract, the award price may be adjusted 
once upward or

[[Page 240]]

downward a maximum of *-------- percent. Any price adjustment for the 
product code shall be based upon the percentage change in the PPI 
released in the month prior to the initial month of the contract period 
specified in the solicitation for sealed bidding or the month prior to 
award in negotiation (the base index) and the PPI released 12 months 
later (the updated index). The formula for determining the Adjusted 
Contract Price (ACP) applicable to shipments for the balance of the 
contract period is--
[GRAPHIC] [TIFF OMITTED] TR09JY99.000

    (c) If the PPI is not available for the month of the base index or 
the updated index, the month with the most recently published PPI prior 
to the month determining the base index or updated index shall be used.
    (d) If a product code is discontinued, the Government and the 
Contractor will mutually agree to substitute a similar product code. If 
Labor designates an index with a new title and/or code number as 
continuous with the product code specified above, the new index shall be 
used.
    (e) Unless the Contractor's written request for a price adjustment 
resulting from the application of the formula in (b) above is received 
by the Contracting Officer within 30 calendar days of the release of the 
updated index, the Contractor shall have waived its right to an upward 
price adjustment for the balance of the contract. Alternatively, the 
Contracting Officer will unilaterally adjust the award price downward 
when appropriate using the updated index defined in (b) above.
    (f) Price adjustments shall be effective upon execution of a 
contract modification by the Government or on the 31st day following the 
release of the updated index, whichever is later, shall indicate the 
updated index and percent of change as well as the ACP, and shall not 
apply to delivery orders issued before the effective date.

                             (End of clause)

    Alternate I (SEP 1999). As prescribed in 516.203-4(b) (1) and (2), 
substitute the following paragraphs (b), (e) and (f) for paragraphs (b), 
(e) and (f) of the basic clause:

    (b) In any option period, the contract price may be adjusted upward 
or downward a maximum of *-------- percent.
    (1) For the first option period, any price adjustment for the 
product code shall be based upon the percentage change in the PPI 
released in the month prior to the initial month of the contract period 
specified in the solicitation for sealed bidding or the month prior to 
award in negotiation (the base index) and the PPI released in the third 
month before completion of the initial contract period stated in the 
solicitation (the updated index). This initial contract period may be 
less than 12 months. The formula for determining the Adjusted Contract 
Price (ACP) applicable to shipments during the first option period is--
[GRAPHIC] [TIFF OMITTED] TR09JY99.001

    (2) For any subsequent option period, the price adjustment shall be 
the percentage change between the previously updated index (the new base 
index) and the PPI released 12 months later (the most recent updated 
index). This percentage shall be applied to the Current Contract Price 
(CCP). The formula for determining the ACP applicable to shipments for 
the subsequent option period(s) is--
[GRAPHIC] [TIFF OMITTED] TR09JY99.002

    (e) Unless the Contractor's written request for a price adjustment 
resulting from the application of the formulas in (b) (1) or (2) above 
is received by the Contracting Officer within 30 calendar days of the 
date of the Government's preliminary written notice of its intent to 
exercise the option, the Contractors shall have waived its right to an 
upward price adjustment for that option period. Alternatively, the 
Contracting Officer in its written notice shall exercise the option at 
the CCP or at a reduced price when appropriate using the formulas in (b) 
(1) or (2) above.
    (f) Price adjustments shall be effected by execution of a contract 
modification by the Government indicating the most recent updated index 
and percent of change and shall apply to delivery orders placed on or 
after the first day of the option period.

    Alternate II (SEP 1999). As prescribed in 516.203-4(b)(2), add the 
following paragraph (g) to the basic clause.

    (g) No price adjustment will be made unless the percentage in the 
PPI is at least **---- percent.

    * The appropriate percentage should be determined based upon the 
historical trend in the PPI for the product code. A ceiling of more than 
10 percent must be approved by the Contracting Director.
    ** The Contracting Officer should insert a lower percent than the 
maximum percentage stated in paragraph (b) of the clause.

[[Page 241]]



552.216-72  Placement of Orders.

    As prescribed in 516.506, inset the following clause:

                     Placement of Orders (SEP 1999)

    (a) Delivery orders (orders) will be placed by:
    [Contracting Officer insert names of Federal agencies]
    (b) Orders may be placed through Electronic Data Interchange (EDI) 
or mailed in paper form. EDI orders shall be placed using the American 
National Standards Institute (ANSI) X12 Standard for Electronic Data 
Interchange (EDI) format.
    (c) If the Contractor agrees, GSA's Federal Supply Service (FSS) 
will place all orders by EDI using computer-to-computer EDI. If 
computer-to-computer EDI is not possible, FSS will use an alternative 
EDI method allowing the Contractor to receive orders by facsimile 
transmission. Subject to the Contractor's agreement, other agencies may 
place orders by EDI.
    (d) When computer-to-computer EDI procedures will be used to place 
orders, the Contractor shall enter into one or more Trading Partner 
Agreements (TPA) with each Federal agency placing orders electronically 
in order to ensure mutual understanding by the parties of certain 
electronic transaction conventions and to recognize the rights and 
responsibilities of the parties as they apply to this method of placing 
orders. The TPA must identify, among other things, the third party 
provider(s) through which electronic orders are placed, the transaction 
sets used, security procedures, and guidelines for implementation. 
Federal agencies may obtain a sample format to customize as needed from 
the office specified in (g) below.
    (e) The Contractor shall be responsible for providing its own 
hardware and software necessary to transmit and receive data 
electronically. Additionally, each party to the TPA shall be responsible 
for the costs associated with its use of third party provider services.
    (f) Nothing in the TPA will invalidate any part of this contract 
between the Contractor and the General Services Administration. All 
terms and conditions of this contract that otherwise would be applicable 
to a mailed order shall apply to the electronic order.
    (g) The basic content and format of the TPA will be provided by:
    General Services Administration, Acquisition Operations and 
Electronic Commerce Center (FCS), Washington, DC 20406
    Telephone: [Contracting officer insert appropriate telephone 
numbers]
    FAX:

                             (End of clause)

    Alternate I (SEP 1999). As prescribed in 516.506, substitute the 
following paragraphs (a), (b), (c), and (d) for paragraphs (a), (b), 
(c), and (d) of the basic clause:

    (a) All delivery orders (orders) under this contract will be placed 
by the General Services Administration's Federal Supply Service (FSS). 
The Contractor is not authorized to accept orders from any other agency. 
Violation of this restriction may result in termination of the contract 
pursuant to the default clause of this contract.
    (b) All orders shall be placed by Electronic Data Interchange (EDI) 
using the American National Standards Institute (ANSI) X12 Standard for 
Electronic Data Interchange (EDI) format.
    (c) If the Contractor agrees, transmission will be computer-to-
computer EDI. If computer-to-computer EDI is not possible, FSS will use 
an alternative EDI method allowing the Contractor to receive orders by 
facsimile transmission.
    (d) When computer-to-computer EDI procedures will be used to place 
orders, the Contractor shall enter into a Trading Partner Agreement 
(TPA) with FSS in order to ensure mutual understanding by the parties of 
certain electronic transaction conventions and to recognize the rights 
and responsibilities of the parties as they apply to this method of 
placing orders. The TPA must identify among other things, the third 
party provider(s) through which electronic orders are placed, the 
transaction sets used, security procedures, and guidelines for 
implementation.

    Alternate II (SEP 1999). As prescribed in 516.506(b), substitute the 
following paragraph (a) for paragraph (a) of the basic clause:

    (a) The organizations listed below may place orders under this 
contract. Questions regarding organizations authorized to use this 
schedule should be directed to the Contracting Officer.
    (1) Executive agencies.
    (2) Other Federal agencies.
    (3) Mixed-ownership Government corporations.
    (4) The District of Columbia.
    (5) Government contractors authorized in writing by a Federal agency 
pursuant to 48 CFR 51.1.
    (6) Other activities and organizations authorized by statute or 
regulation to use GSA as a source of supply.

    Alternate III (MAY 2004). As prescribed in 516.506(c), substitute 
the following paragraphs (a), (c), and (d) for

[[Page 242]]

paragraphs (a), (c), and (d) of the basic clause:

    (a) See 552.238-78, Scope of Contract (Eligible Ordering 
Activities), for who may order under this contract.

                                * * * * *

    (c) If the Contractor agrees, GSA's Federal Supply Service (FSS) 
will place orders for eligible ordering activities, as defined in 
paragraph (a) of the clause at 552.238-78, by EDI using computer-to-
computer EDI. If computer-to-computer EDI is not possible, FSS will use 
an alternative EDI method allowing the Contractor to receive orders by 
facsimile transmission. Subject to the Contractor's agreement, other 
eligible ordering activities, as defined in paragraphs (a) and (d) of 
the clause at 552.238-78, may also place orders by EDI.
    (d) When computer-to-computer EDI procedures will be used to place 
orders, the Contractor shall enter into one or more Trading Partner 
Agreements (TPA) with each ordering activity placing orders 
electronically in order to ensure mutual understanding by the parties of 
certain electronic transaction conventions and to recognize the rights 
and responsibilities of the parties as they apply to this method of 
placing orders. The TPA must identify, among other things, the third 
party provider(s) through which electronic orders are placed, the 
transaction sets used, security procedures, and guidelines for 
implementation. Ordering activities may obtain a sample format to 
customize as needed from the office specified in paragraph (g) of this 
clause.
    Alternate IV (FEB 2007). As prescribed in 516.506(d), substitute the 
following paragraphs (a), (c), and (d) for paragraphs (a), (c), and (d) 
of the basic clause:

    (a) See 552.238-78, Scope of Contract (Eligible Ordering 
Activities)--Alternate I, for who may order under this contract.
    (c) If the Contractor agrees, GSA's Federal Acquisition Service 
(FAS) will place orders for eligible ordering activities, as defined in 
paragraph (a) of the clause at 552.238-78-Alternate I, by EDI using 
computer-to-computer EDI. If computer-to-computer EDI is not possible, 
FAS will use an alternative EDI method allowing the Contractor to 
receive orders by facsimile transmission. Subject to the Contractor's 
agreement, other eligible ordering activities, as defined in paragraphs 
(a) and (d) of the clause at 552.238-78-Alternate I, may also place 
orders by EDI.
    (d) When computer-to-computer EDI procedures will be used to place 
orders, the Contractor shall enter into one or more Trading Partner 
Agreements (TPA) with each ordering activity placing orders 
electronically in order to ensure mutual understanding by the parties of 
certain electronic transaction conventions and to recognize the rights 
and responsibilities of the parties as they apply to this method of 
placing orders. The TPA must identify, among other things, the third 
party provider(s) through which electronic orders are placed, the 
transaction sets used, security procedures, and guidelines for 
implementation. Ordering activities may obtain a sample format to 
customize as needed from the office specified in paragraph (g) of this 
clause.

[64 FR 37229, July 9, 1999, as amended at 68 FR 24380, May 7, 2003; 69 
FR 28065, May 18, 2004; 72 FR 4654, Feb. 1, 2007]



552.216-73  Ordering Information.

    As prescribed in 516.506(e), insert the following provision:

                     Ordering Information (SEP 1999)

    (a) In accordance with the Placement of Orders clause of this 
solicitation, the offeror elects to receive orders placed by GSA's 
Federal Supply Service (FSS) by either [squ] facsimile transmission or 
[squ] computer-to-computer Electronic Data Interchange (EDI).
    (b) An offeror electing to receive computer-to-computer EDI is 
requested to indicate below the name, address, and telephone number of 
the representative to be contacted regarding establishment of an EDI 
interface.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

    (c) An offeror electing to receive orders by facsimile transmission 
is requested to indicate below the telephone number(s) for facsimile 
transmission equipment where orders should be forwarded.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

    (d) For mailed orders, the offeror is requested to include the 
postal mailing address(es) where paper form orders should be mailed.

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

                           (End of provision)

    Alternate I (SEP 1999). As prescribed in 516.506(e), delete 
paragraph (d) of the basic provision.
    Alternate II (SEP 1999). As prescribed in 516.506(e), add paragraph 
(e) to the basic provision.

    (e) Offerors marketing through dealers are requested to indicate 
below whether those

[[Page 243]]

dealers will be participating in the proposed contract.

    Yes ( ) No ( )

    If ``yes'' is checked, ordering information to be inserted above 
shall reflect that in addition to offeror's name, address, and facsimile 
transmission telephone number, orders can be addressed to the offeror's 
name, c/o nearest local dealer. In this event, two copies of a list of 
participating dealers shall accompany this offer, and shall also be 
included in Contractor's Federal Supply Schedule pricelist.

[64 FR 37229, July 9, 1999, as amended at 72 FR 4654, Feb. 1, 2007]



552.217-70  Evaluation of Options.

    As prescribed in 517.208(a), insert the following provision:

                    Evaluation of Options (AUG 1990)

    (a) The Government will evaluate offers for award purposes by 
determining the lowest base period price. When option year pricing is 
based on a formula (e.g., changes in the Producer Price Index or other 
common standard); option year pricing is automatically considered when 
evaluating the base year price, as any change in price will be uniformly 
related to changes in market conditions. All options are therefore 
considered to be evaluated. Evaluation of options will not obligate the 
Government to exercise the option(s).
    (b) The Government will reject the offer if exceptions are taken to 
the price provisions of the Economic Price Adjustment clause, unless the 
exception results in a lower maximum option year price. Such offers will 
be evaluated without regard to the lower option year(s) maximum. 
However, if the offeror offering a lower maximum is awarded a contract, 
the award will reflect the lower maximum.



552.217-71  Notice Regarding Option(s).

    As prescribed in 517.208(b), insert the following provision:

                  Notice Regarding Option(s) (NOV 1992)

    The General Services Administration (GSA) has included an option to 
[Insert ``purchase additional quantities of supplies or services'' or 
``extend the term of this contract'' or ``purchase additional quantities 
of supplies or services and to extend the term of this contract''] in 
order to demonstrate the value it places on quality performance by 
providing a mechanism for continuing a contractual relationship with a 
successful Offeror that performs at a level which meets or exceeds GSA's 
quality performance expectations as communicated to the Contractor, in 
writing, by the Contracting Officer or designated representative. When 
deciding whether to exercise the option, the Contracting Officer will 
consider the quality of the Contractor's past performance under this 
contract in accordance with 48 CFR 517.207.

                           (End of provision)



552.219-70  Allocation of Orders--Partially Set-Aside Items.

    As prescribed in 519.508, insert the following clause:

       Allocation of Orders--Partially Set-Aside Items (SEP 1999)

    Where the set-aside portion of an item or group of items is awarded 
to a Contractor other than the one receiving the award on the 
corresponding non-set-aside portion, the Government will divide the 
requirements to be ordered between the two Contractors with the 
objective of achieving, as nearly as possible, a 50/50 division of the 
total value of orders placed after the award of the set-aside portion. 
In no case will this division vary by more than a 60/40 division (with 
either the non-set-aside or set-aside Contractor receiving the larger 
portion) from the time of the award of the set-aside portion.

                             (End of clause)



552.219-71  Notice to Offerors of Subcontracting Plan Requirements.

    As prescribed in 519.708-70(a), insert the following provision:

    Notice to Offerors of Subcontracting Plan Requirements (JUN 2005)

    The General Services Administration (GSA) is committed to assuring 
that maximum practicable opportunity is provided to small, HUBZone 
small, small disadvantaged, women-owned, veteran-owned, and service-
disabled veteran-owned small business concerns to participate in the 
performance of this contract consistent with its efficient performance. 
GSA expects any subcontracting plan submitted pursuant to FAR 52.219-9, 
Small Business Subcontracting Plan, to reflect this commitment. 
Consequently, an offeror, other than a small business concern, before 
being awarded a contract exceeding $500,000 ($1,000,000 for 
construction), must demonstrate that its subcontracting plan represents 
a creative and innovative program for involving small, HUBZone small, 
small disadvantaged, women-owned, veteran-owned, and service-disabled 
veteran-owned small business concerns as subcontractors in the 
performance of this contract.

[[Page 244]]

                           (End of provision)

[64 FR 37229, July 9, 1999, as amended at 70 FR 32522, 32523, June 3, 
2005]



552.219-72  Preparation, Submission, and Negotiation of Subcontracting Plans.

    As prescribed in 519.708-70(b), insert the following provision:

 Preparation, Submission, and Negotiation of Subcontracting Plans (JUN 
                                  2005)

    (a) An offeror, other than a small business concern, submitting an 
offer that exceeds $500,000 ($1,000,000 for construction) shall submit a 
subcontracting plan with its initial offer. The subcontracting plan will 
be negotiated concurrently with price and any required technical and 
management proposals, unless the offeror submits a previously-approved 
commercial plan.
    (b) Maximum practicable utilization of small, HUBZone small, small 
disadvantaged, women-owned, veteran-owned, and service-disabled veteran 
owned small business concerns as subcontractors is a matter of national 
interest with both social and economic benefits. The General Services 
Administration (GSA) expects that an offeror's subcontracting plan will 
reflect a commitment to assuring that small, HUBZone small, small 
disadvantaged, women-owned, veteran-owned, and service-disabled veteran 
owned small business concerns are provided the maximum practicable 
opportunity, consistent with efficient contract performance, to 
participate as subcontractors in the performance of the resulting 
contract. An offeror submitting a commercial plan can reflect this 
commitment through subcontracting opportunities it provides that relate 
to the offeror's production generally; i.e., for both its commercial and 
Government business.
    (c) GSA believes that this potential contract provides significant 
opportunities for the use of small, HUBZone small, small disadvantaged, 
women-owned, veteran-owned, and service-disabled veteran-owned small 
business concerns as subcontractors. Consequently, in addressing the 
eleven elements described at FAR 52.219-9(d) of the clause in this 
contract entitled Small Business Subcontracting Plan, the offeror shall:
    (1) Demonstrate that its subcontracting plan represents a creative 
and innovative program for involving small, HUBZone small, small 
disadvantaged, women-owned, veteran-owned, and service-disabled veteran-
owned small business concerns in performing the contract.
    (2) Include a description of the offeror's subcontracting strategies 
used in any previous contracts, significant achievements, and how this 
plan will build upon those earlier achievements.
    (3) Demonstrate through its plan that it understands the small 
business subcontracting program's objectives and GSA's expectations, and 
it is committed to taking those actions necessary to meet these goals or 
objectives.
    (d) In determining the acceptability of any subcontracting plan, the 
Contracting Officer will take each of the following actions:
    (1) Review the plan to verify that the offeror demonstrates an 
understanding of the small business subcontracting program's objectives 
and GSA's expectations with respect to the program and has included all 
the information, goals, and assurances required by FAR 52.219-9.
    (2) Consider previous goals and achievements of contractors in the 
small industry.
    (3) Consider information and potential sources obtained from 
agencies administering national and local preference programs and other 
advocacy groups in evaluating whether the goals stated in the plan 
adequately reflect the anticipated potential for subcontracting to 
small, HUBZone small, small disadvantaged, women-owned, veteran-owned, 
and service-disabled veteran-owned small business concerns.
    (4) Review the offeror's description of its strategies, historical 
performance and significant achievements in placing subcontracts for the 
same or similar products or services with small, HUBZone small, small 
disadvantaged, women-owned, veteran-owned, and service-disabled veteran-
owned small business concerns. The offeror's description can apply to 
commercial as well as previous Government contracts.
    (e) Failure to submit an acceptable subcontracting plan and/or 
correct deficiencies in a plan within the time specified by the 
Contracting Officer shall make the offeror ineligible for award.

                           (End of provision)

[64 FR 37229, July 9, 1999, as amended at 70 FR 32522, 32523, June 3, 
2005]



552.219-73  Goals for Subcontracting Plan.

    As prescribed in 519.708-70(c), insert the following provision:

                Goals for Subcontracting Plan (JUN 2005)

    (a) Maximum practicable utilization of small, HUBZone small, small 
disadvantaged, women-owned, veteran-owned, and service-disabled veteran-
owned small business concerns as subcontractors is a matter of national 
interest with both social and economic benefits.
    (1) The General Service Administration's (GSA's) commitment to 
ensuring that maximum practicable opportunity is provided to small, 
HUBZone small, small disdvantaged,

[[Page 245]]

women-owned, veteran-owned, and service-disabled veteran-owned small 
business concerns to participate as subcontractors in the performance of 
this contract, consistent with its efficient performance, must be 
reflected in the offeror's subcontracting plan submitted pursuant to the 
clause of this contract at FAR 52.219-9, Small Business Subcontracting 
Plan.
    (2) In addressing the eleven elements described at FAR 52.219-9(d), 
the offeror shall demonstrate that its subcontracting plan represents a 
creative and innovative program for involving small, HUBZone small, 
small disadvantaged, women-owned, veteran-owned, and service-disabled 
veteran owned small business concerns in performing this contract. An 
offeror submitting a commercial plan can demonstrate its commitment in 
providing maximum practicable opportunities through subcontracting 
opportunities it provides to small, HUBZone small, small disadvantaged, 
women-owned, veteran-owned, and service-disabled veteran owned small 
business concerns that relate to the offeror's production generally; 
i.e., for both its commercial and Government business.
    (3) The subcontracting plan shall include a description of the 
offeror's subcontracting strategies used in previous contracts and 
significant achievements, with an explanation of how this plan will 
build upon those earlier achievements. Additionally, the offeror shall 
demonstrate through its plan that it understands the small business 
subcontracting program's objectives, GSA's expectations, and is 
committed to taking those actions necessary to meet these goals or 
objectives.
    (b) GSA believes that this contract provides significant 
opportunities for the use of small, HUBZone small, small disadvantaged, 
women-owned, veteran-owned, and service-disabled veteran-owned small 
business concerns as subcontractors. Accordingly, it is anticipated that 
an acceptable subcontracting plan will contain at least the following 
goals:

Small Business.......................................      ---- percent.
HUBZone Small Business...............................      ---- percent.
Small Disadvantaged Business.........................      ---- percent.
Women-Owned Small Business...........................      ---- percent.
Veteran-Owned Small Business.........................      ---- percent.
Service-Disabled Veteran-Owned Small Business........      ---- percent.
 

    Note: Target goals are expressed as a percentage of planned 
subcontracting dollars.
    (c) In determining the acceptability of any subcontracting plan, the 
Contracting Officer will--
    (1) Review the plan to verify that the offeror has demonstrated an 
understanding of the small business subcontracting program's objectives 
and GSA's expectations with respect to the programs and has included all 
the information, goals, and assurances required by FAR 52.219-9;
    (2) Consider previous goals and achievements of contractors in the 
same industry;
    (3) Consider information and potential sources obtained from 
agencies administering national and local preference programs and other 
advocacy groups in evaluating whether the goals stated in the plan 
adequately reflect the anticipated potential for subcontracting to 
small, HUBZone small, small disadvantaged, women-owned, veteran-owned, 
and service-disabled veteran-owned small business concerns; and
    (4) Review the offeror's description of its strategies, historical 
performance and significant achievements in placing subcontracts for the 
same or similar products or services with small, HUBZone small, small 
disadvantaged, women-owned, veteran-owned, and service-disabled veteran-
owned small business concerns. The offeror's description can apply to 
commercial as well as previous Government contracts.
    (d) Failure to submit an acceptable subcontracting plan and/or 
correct deficiencies in a plan within the time specified by the 
Contracting Officer shall make the offeror ineligible for award.

                           (End of provision)

    Alternate I (SEP 1999). As prescribed in 519.708-70(c)(2), delete 
paragraph (b) of the basic provision and redesignate paragraphs (c) and 
(d) as paragraphs (b) and (c).

[64 FR 37229, July 9, 1999, as amended at 70 FR 32522, 32523, June 3, 
2005]



552.219-74  Section 8(a) Direct Award.

    As prescribed in 519.870-8, insert the following clause:

                  Section 8(a) Direct Award (SEP 1999)

    (a) This contract is issued as a direct award between the 
contracting activity and the 8(a) Contractor pursuant to the Memorandum 
of Understanding between the Small Business Administration (SBA) and the 
General Services Administration. SBA retains the responsibility for 8(a) 
certifications, 8(a) eligibility determinations, and related issues, and 
will provide counseling and assistance to the 8(a) contractor under the 
8(a) program. The cognizant SBA district office is: [Complete at time of 
award]
    (b) The contracting activity is responsible for administering the 
contract and taking any action on behalf of the Government under the 
terms and conditions of the contract. However, the contracting activity 
shall give advance notice to SBA before it

[[Page 246]]

issues a final notice terminating performance, either in whole or in 
part, under the contract. The contracting activity shall also coordinate 
with SBA prior to processing any advance payments or novation 
agreements. The contracting activity may assign contract administration 
functions to a contract administration office.
    (c) The Contractor agrees:
    (1) To notify the Contracting Officer, simultaneous with its 
notification to SBA (as required by SBA's 8(a) regulations), when the 
owner or owners upon whom 8(a) eligibility is based plan to relinquish 
ownership or control of the concern. Consistent with 15 U.S.C. 
637(a)(21), transfer of ownership or control shall result in termination 
of the contract for convenience, unless SBA waives the requirement for 
termination prior to the actual relinquishing of ownership and control.
    (2) To the requirements of 52.219-14, Limitations on Subcontracting.

                             (End of clause)



552.223-70  Hazardous Substances.

    As prescribed in 523.303(a), insert the following clause:

                     Hazardous Substances (MAY 1989)

    (a) If the packaged items to be delivered under this contract are of 
a hazardous substance and ordinarily are intended or considered to be 
for use as a household item, this contract is subject to the Federal 
Hazardous Materials Act, as amended (15 U.S.C. 1261-1276), implementing 
regulations thereof (16 CFR Chapter II), and Federal Standard No. 123, 
Marking for Shipment (Civil Agencies), issue in effect on the date of 
this solicitation.
    (b) The packaged items to be delivered under this contract are 
subject to the preparation of shipping documents, the preparation of 
items for transportation, shipping container construction, package 
making, package labeling, when required, shipper's certification of 
compliance, and transport vehicle placarding in accordance with Parts 
171 through 178 of 49 CFR and the Hazardous Materials Transportation 
Act.
    (c) The minimum packaging acceptable for packaging Department of 
Transportation regulated hazardous materials shall be those in 49 CFR 
173.

                             (End of clause)



552.223-71  Nonconforming Hazardous Materials.

    As prescribed in 523.303(b), insert the following clause:

              Nonconforming Hazardous Materials (SEP 1999)

    (a) Nonconforming supplies that contain hazardous material or that 
may expose persons who handle or transport the supplies to hazardous 
material and which require replacement under the inspection and/or 
warranty clauses of this contract shall be reshipped to the Contractor 
at the Contractor's expense. The Contractor agrees to accept return of 
these nonconforming supplies and to pay all costs occasioned by their 
return.
    (b) ``Hazardous materials,'' as used in this clause, includes any 
material defined as hazardous under the latest version of Federal 
Standard No. 313 (including revisions adopted during the term of the 
contract).
    (c) If the Contractor fails to provide acceptable disposition 
instructions for the nonconforming supplies within 10 days from the date 
of the Government's request (or such longer period as may be agreed to 
between the Contracting Officer and the Contractor), or fails to accept 
return of the reshipped nonconforming supplies, such failure:
    (1) may be interpreted as a willful failure to perform,
    (2) may result in termination of the contract for default and
    (3) shall be considered by the Contracting Officer in determining 
the responsibility of the Contractor for any future award (see FAR 
9.104-3(b) and 9.406-2).
    (d) Pending final resolution of any dispute, the Contractor shall 
promptly comply with the decision of the Contracting Officer.

                             (End of clause)



552.223-72  Hazardous Material Information.

    As prescribed in 523.370, insert the following provision:

                Hazardous Material Information (SEP 1999)

    Offeror shall indicate for each national stock number (NSN) the 
following information:

------------------------------------------------------------------------
                    DOT shipping   DOT hazard
       NSN              name         class         DOT label required
------------------------------------------------------------------------
                                               Yes [ ] No [ ]
                                               Yes [ ] No [ ]
                                               Yes [ ] No [ ]
------------------------------------------------------------------------

                           (End of provision)



552.225-70  Notice of Procurement Restriction--Hand or Measuring Tools or Stainless Steel Flatware.

    As prescribed in 525.1101, insert the following clause:

[[Page 247]]

Notice of Procurement Restriction--Hand or Measuring Tools or Stainless 
                        Steel Flatware (SEP 1999)

    (a) Awards under this solicitation will only be made to offerors 
that will furnish hand or measuring tools or stainless steel flatware 
that are domestic end products. Pursuant to the requirements of the 
current Department of Defense Appropriations Act, GSA has determined, in 
accordance with Section 6-104.4 of the Armed Services Procurement 
Regulation (6/15/70)(32 CFR 6-104.4), that it is in the national 
interest to reject foreign products.
    As used in this clause, a ``domestic end product'' is--
    (1) Any hand or measuring tool, except for an electric or air-motor 
driven hand tool, or stainless steel flatware, wholly produced or 
manufactured, including all components, in the United States or its 
possessions; or
    (2) Any electric or air-motor driven hand tool if the cost of its 
components produced or manufactured in the United States exceeds 75 
percent of the cost of all its components.
    (b) Tool kits or sets, being procured under this solicitation, will 
not be considered domestic end products if any individual tool 
classified in FSC Group 51 or 52 and included in a tool kit or set is 
not a domestic end product as defined in paragraph (a) of this clause. 
The restrictions of this clause do not apply to individual hand or 
measuring tools that are contained in the tool kit or set but are not 
classified in FSC Group 51 or 52.

                             (End of clause)

[64 FR 37229, July 9, 1999, as amended at 65 FR 41379, July 5, 2000]



552.227-70  Government Rights (Unlimited).

    As prescribed in 527.409, insert the following clause:

                Government Rights (Unlimited) (MAY 1989)

    The Government shall have unlimited rights in all drawings, designs, 
specifications, notes and other works developed in the performance of 
this contract, including the right to use same on any other Government 
design or construction without additional compensation to the 
Contractor. The Contractor hereby grants to the Government a paid-up 
license throughout the world to all such works to which he may assert or 
establish any claim under design patent or copyright laws. The 
Contractor for a period of three years after completion of the project 
agrees to furnish the original or copies of all such works on the 
request of the Contracting Officer.

                             (End of clause)



552.227-71  Drawings and Other Data To Become Property of Government.

    As prescribed in 527.409(b), substitute the following clause:

   Drawings and Other Data To Become Property of Government (MAY 1989)

    All designs, drawings, specifications, notes and other works 
developed in the performance of this contract shall become the sole 
property of the Government and may be used on any other design or 
construction without additional compensation to the Contractor. The 
Government shall be considered the ``person for whom the work was 
prepared'' for the purpose of authorship in any copyrightable work under 
Section 201(b) of Title 17, United States Code. With respect thereto, 
the Contractor agrees not to assert or authorize others to assert any 
rights nor establish any claim under the design patent or copyright 
laws. The Contractor for a period of three years after completion of the 
project agrees to furnish all retained works on the request of the 
Contracting Officer. Unless otherwise provided in this contract, the 
Contractor shall have the right to retain copies of works beyond such 
period.

                             (End of clause)



552.228-70  Workers' Compensation Laws.

    As prescribed in 528.310(a), insert the following clause:

                  Workers' Compensation Laws (SEP 1999)

    The Act of June 25, 1936, 49 Stat. 1938 (40 U.S.C. 290) authorizes 
the constituted authority of the several States to apply their workers' 
compensation laws to all lands and premises owned or held by the United 
States.

                             (End of clause)



552.229-70  Federal, State, and Local Taxes.

    As prescribed in 529.401-70, insert the following clause:

               Federal, State, and Local Taxes (APR 1984)

    The contract price includes all applicable Federal, State, and local 
taxes. No adjustment will be made to cover taxes which may subsequently 
be imposed on this transaction or changes in the rates of currently 
applicable taxes. However, the Government will, upon the request of the 
Contractor, furnish evidence appropriate to establish exemption from any 
tax from which the Government is

[[Page 248]]

exempt and which was not included in the contract price.

                             (End of clause)



552.229-71  Federal Excise Tax--DC Government.

    As prescribed in 529.401-71, insert the following clause:

              Federal Excise Tax--DC Government (SEP 1999)

    If the District of Columbia cites an Internal Revenue Tax Exempt 
Certificate Number on orders placed under this contract, the Contractor 
shall bill shipments to the District of Columbia at prices exclusive of 
Federal excise tax and show the amount of such tax on the invoice.

                             (End of clause)



552.232-1  Payments.

    As prescribed in 532.7104, insert the following clause:

              Payments (APR 1984) (Deviation FAR 52.232-1)

    (a) The Government shall pay the Contractor, without submission of 
invoices or vouchers, 30 days after the service period, the prices 
stipulated in this contract for supplies delivered and accepted or 
services rendered and accepted, less any deductions provided in this 
contract.
    (b) Unless otherwise specified in this contract, the Government will 
make payment on partial deliveries accepted by the Government if either:
    (1) The amount due on the deliveries warrants it.
    (2) The Contractor requests it and the amount due on the deliveries 
is at least $1,000 or 50 percent of the total contract price.
    (c) When processing payment, GSA's Finance Office will automatically 
generate the 12 digit invoice number using the ACT number assigned to 
the contract, followed by an abbreviated month and year of service 
(e.g., 84261554JUN7, for June 1997). The ACT number appears on the 
contract award document.

                             (End of clause)



552.232-8  Discounts for Prompt Payment.

    As prescribed in 532.206, insert the following clause:

    Discounts for Prompt Payment (APR 1989) (Deviation FAR 52.232-8)

    (a) Discounts for early payment (hereinafter referred to as 
``discounts'' or ``the discount'') will be considered in evaluating the 
relationship of the offeror's concessions to the Government vis-a-vis 
the offeror's concessions to its commercial customers, but only to the 
extent indicated in this clause.
    (b) Discounts will not be considered to determine the low offeror in 
the situation described in the ``Offers on Identical Products'' 
provision of this solicitation.
    (c) Uneconomical discounts will not be considered as meeting the 
criteria for award established by the Government. In this connection, a 
discount will be considered uneconomical if the annualized rate of 
return for earning the discount is lower than the ``value of funds'' 
rate established by the Department of the Treasury and published 
quarterly in the Federal Register. The ``value of funds'' rate applied 
will be the rate in effect on the date specified for the receipt of 
offers.
    (d) Agencies required to use the resultant schedule will not apply 
the discount in determining the lowest delivered price pursuant to the 
FPMR, 41 CFR 101-26.408, if the agency determines that payment will 
probably not be made within the discount period offered. The same is 
true if the discount is considered uneconomical at the time of placement 
of the order.
    (e) Discounts for early payment may be offered either in the 
original offer or on individual invoices submitted under the resulting 
contract. Discounts offered will be taken by the Government if payment 
is made within the discount period specified.
    (f) Discounts that are included in offers become a part of the 
resulting contracts and are binding on the Contractor for all orders 
placed under the contract. Discounts offered only on individual invoices 
will be binding on the Contractor only for the particular invoice on 
which the discount is offered.
    (g) In connection with any discount offered for prompt payment, time 
shall be computed from the date of the invoice. For the purpose of 
computing the discount earned, payment shall be considered to have been 
made on the date which appears on the payment check or the date on which 
an electronic funds transfer was made.

                             (End of clause)

    Alternate I (MAY 2003). As prescribed in 532.206(a), remove 
paragraph (d) and redesignate paragraphs (e), (f), and (g) as (d), (e), 
and (f), respectively.

[64 FR 37229, July 9, 1999, as amended at 68 FR 24380, May 7, 2003]



552.232-23  Assignment of Claims.

    As prescribed in 532.806, insert the following clause:

[[Page 249]]

                     Assignment of Claims (SEP 1999)

    Because this is a requirements or indefinite quantity contract under 
which more than one agency may place orders, paragraph (a) of the 
Assignment of Claims clause (FAR 52.232-23) is inapplicable and the 
following is substituted therefor:
    In order to prevent confusion and delay in making payment, the 
Contractor shall not assign any claim(s) for amounts due or to become 
due under this contract. However, the Contractor is permitted to assign 
separately to a bank, trust company, or other financial institution, 
including any Federal lending agency, under the provisions of the 
Assignment of Claims Act, as amended, 31 U.S.C. 3727, 41 U.S.C. 15 
(hereinafter referred to as ``the Act''), all amounts due or to become 
due under any order amounting to $1,000 or more issued by any Government 
agency under this contract. Any such assignment takes effect only if and 
when the assignee files written notice of the assignment together with a 
true copy of the instrument of assignment with the contracting officer 
issuing the order and the finance office designated in the order to make 
payment. Unless otherwise stated in the order, payments to an assignee 
of any amounts due or to become due under any order assigned may, to the 
extent specified in the Act, be subject to reduction or set-off.

                             (End of clause)



552.232-25  Prompt Payment.

    As prescribed in 532.908(a)(2), insert the following clause:

           Prompt Payment (JUL 1998) (Deviation FAR 52.232-25)

    Notwithstanding any other payment clause in this contract, the 
Government will make invoice payments and contract financing payments 
under the terms and conditions specified in this clause. Payment shall 
be considered as being made on the day a check is dated or the date of 
an electronic funds transfer. Definitions of pertinent terms are set 
forth in section 32.902 of the Federal Acquisition Regulation. All days 
referred to in this clause are calendar days, unless otherwise 
specified. (However, see subparagraph (a)(4) of this clause concerning 
payments due on Saturdays, Sundays, and legal holidays.)
    (a) Invoice payments. (1) The due date for making invoice payments 
by the designated payment office is:
    (i) For orders placed electronically by the General Services 
Administration (GSA) Federal Supply Service (FSS), and to be paid by GSA 
through electronic funds transfer (EFT), the later of the following two 
events:
    (A) The 10th day after the designated billing office receives a 
proper invoice from the Contractor. If the designated billing office 
fails to annotate the invoice with the date of receipt at the time of 
receipt, the invoice payment due date shall be the 10th day after the 
date of the Contractor's invoice; provided the Contractor submitted a 
proper invoice and no disagreement exists over quantity, quality, or 
Contractor compliance with contract requirements.
    (B) The 10th day after Government acceptance of supplies delivered 
or services performed by the Contractor.
    (ii) For all other orders, the later of the following two events:
    (A) The 30th day after the designated billing office receives a 
proper invoice from the Contractor. If the designated billing office 
fails to annotate the invoice with the date of receipt at the time of 
receipt, the invoice payment due date shall be the 30th day after the 
date ofthe Contractor's invoice; provided the Contractor submitted a 
proper invoice and no disagreement exists over quantity, quality, or 
Contractor compliance with contract requirements.
    (B) The 30th day after Government acceptance of supplies delivered 
or services performed by the Contractor.
    (iii) On a final invoice, if the payment amount is subject to 
contract settlement actions, acceptance occurs on the effective date of 
the contract settlement.
    (2) The General Services Administration will issue payment on the 
due date in (a)(1)(i) above if the Contractor complies with full cycle 
electronic commerce. Full cycle electronic commerce includes all the 
following elements:
    (i) The Contractor must receive and fulfill electronic data 
interchange (EDI) purchase orders (transaction set 850).
    (ii) The Contractor must generate and submit to the Government valid 
EDI invoices (transaction set 810) or submit invoices through the GSA 
Finance Center Internet-based invoice process. Internet-based invoices 
must be submitted using procedures provided by GSA.
    (iii) The Contractor's financial institution must receive and 
process, on behalf of the Contractor, EFT payments through the Automated 
Clearing House (ACH) system.
    (iv) The EDI transaction sets in (i) through (iii) above must adhere 
to implementation conventions provided by GSA.
    (3) If any of the conditions in(a)(2) above do not occur, the 10 day 
payment due dates in (a)(1) become 30 day payment due dates.
    (4) Certain food products and other payments.
    (i) Due dates on Contractor invoices for meat, meat food products, 
or fish; perishable agricultural commodities; and dairy products, edible 
fats or oils, and food products prepared from edible fats or oils are--
    (A) For meat or meat food products, as defined in section 2(a)(3) of 
the Packers and

[[Page 250]]

Stockyard Act of 1921 (7 U.S.C. 182 (3)), and as further defined in Pub. 
L. 98-181, including any edible fresh or frozen poultry meat, any 
perishable poultry meat food product, fresh eggs, an any perishable egg 
product, as close as possible to, but not later than, the 7th day after 
product delivery.
    (B) For fresh or frozen fish, as defined in section 204(3) of the 
Fish and Seafood Promotion Act of 1986 (16 U.S.C. 4003(3)), as close as 
possible to, but not later than, the 7th day after product delivery.
    (C) For perishable agricultural commodities, as defined in section 
1(4) of the Perishable Agricultural Commodities Act of 1930 (7 U.S.C. 
499a(4)), as close as possible to, but not later than, the 10th day 
after product delivery, unless another date is specified in the 
contract.
    (D) For daily products, as defined in section 111(e) of the Dairy 
Production Stabilization Act of 1983 (7 U.S.C. 4502(e)), edible fats or 
oils, and food products prepared from edible fats or oils, as close as 
possible to, but not later than, the 10th day after the date on which a 
proper invoice has been received. Liquid milk, cheese, certain processed 
cheese products, butter, yogurt, ice cream, mayonnaise, salad dressing, 
and other similar products, fall within this classification. Nothing in 
the Act limits this classification to refrigerated products. When 
questions arise regarding the proper classification of a specific 
product, prevailing industry practices will be followed in specifying a 
contract payment due date. The burden of proof that a classification of 
a specific product is, in fact, prevailing industry practice is upon the 
Contractor making the representation.
    (ii) If the contract does not require submission of an invoice for 
payment (e.g., periodic lease payments), the due date will be as 
specified in the contract.
    (5) Contractor's invoice. The Contractor shall prepare and submit 
invoices to the designated billing office specified in the contract. 
Notwithstanding paragraph (g) of the clause at FAR 52.212-4, Contract 
Terms and Conditions--Commercial Items, if the Contractor submits hard-
copy invoices, submit only an original invoice. No copies of the invoice 
are required. A proper invoice must include the items listed in 
subdivisions (a)(5)(i) through (a)(5)(viii) of this clause. If the 
invoice does not comply with these requirements, it shall be returned 
within 7 days after the date the designated billing office received the 
invoice (3 days for meat, meat food products, or fish; 5 days for 
perishable agricultural commodities, edible fats or oils, and food 
products prepared from edible fats or oils), with a statement of the 
reasons why it is not a proper invoice. Untimely notification will be 
taken into account in computing any interest penalty owed the Contractor 
in the manner described in subparagraph (a)(5) of this clause.
    (i) Name and address of the Contractor.
    (ii) Invoice date. (The Contractor is encouraged to date invoices as 
close as possible to the date of the mailing or transmission.)
    (iii) Contract number or other authorization for supplies delivered 
or services preformed (including order number and contract line item 
number).
    (iv) Description, quantity, unit of measure, unit price, an extended 
prices of supplies delivered or services performed.
    (v) Shipping and payment terms (e.g., shipment number and date of 
shipment, prompt payment discount terms). Bill of lading number and 
weight of shipment will be shown for shipments on Government bills or 
lading.
    (vi) Name and address of Contractor official to whom payment is to 
be sent (must be the same as that in the contract or in a proper notice 
of assignment).
    (vii) Name (where practicable), title, phone number, and mailing 
address of person to be notified in the event of a defective invoice.
    (viii) Any other information or documentation required by the 
contract (such as evidence of shipment).
    (ix) While not required, the Contractor is strongly encouraged to 
assign an identification number to each invoice.
    (6) Interest penalty. An interest penalty shall be paid 
automatically by the designated payment office, without request from the 
Contractor, if payment is not made by the due date and the conditions 
listed in subdivisions (a)(6)(i) through (a)(6)(iii) of this clause are 
met, if applicable. However, when the due date falls on a Saturday, 
Sunday, or legal holiday when Federal Government offices are closed and 
Government business is not expected to be conducted, payment may be made 
on the following business day without incurring a late payment interest 
penalty.
    (i) A proper invoice was received by the designated billing office.
    (ii) A receiving report or other Government documentation 
authorizing payment was processed, and there was no disagreement over 
quantity, quality, or Contractor compliance with any contract term or 
condition.
    (iii) In the case of a final invoice for any balance of funds due 
the Contractor for supplies delivered or services performed, the amount 
was not subject to further contract settlement actions between the 
Government and the Contractor.
    (7) Computing penalty amount. The interest penalty shall be at the 
rate established by the Secretary of the Treasury under section 12 of 
the Contract Disputes Act of 1978 (41 U.S.C. 611) that is in effect on 
the day after the due date, except where the interest penalty is 
prescribed by other governmental authority (e.g., tariffs). This rate is 
referred to as the ``Renegotiation Board Interest Rate,'' and it is 
published in the Federal

[[Page 251]]

Register semiannually on or about January 1 and July 1. The interest 
penalty shall accrue daily on the invoice principal payment amount 
approved by the Government until the payment date of such approved 
principal amount; and will be compounded in 30-day increments inclusive 
from the first day after the due date through the payment date. That is, 
interest accrued at the end of any 30-day period will be added to the 
approved invoice principal payment amount and will be subject to 
interest penalties if not paid in the succeeding 30-day period. If the 
designated billing office failed to notify the Contractor of a defective 
invoice within the periods prescribed in subparagraph (a)(5) of this 
clause, the due date on the corrected invoice will be adjusted by 
subtracting from such date the number of days taken beyond the 
prescribed notification of defects period. Any interest penalty owed the 
Contractor will be based on this adjusted due date. Adjustments will be 
made by the designated payment office for errors in calculating interest 
penalties.
    (i) For the sole purpose of computing an interest penalty that might 
be due the Contractor, Government acceptance shall be deemed to have 
occurred constructively on the 7th day (unless otherwise specified in 
this contract) after the Contractor delivered the supplies or performed 
the services in accordance with the terms and conditions of the 
contract, unless there is a disagreement over quantity, quality or 
Contractor compliance with a contract provision. In the event that 
actual acceptance occurs within the constructive acceptance period, the 
determination of an interest penalty shall be based on the actual date 
of acceptance. The constructive acceptance requirement does, not 
however, compel Government officials to accept supplies or services, 
perform contract administration functions, or make payment prior to 
fulfilling their responsibilities.
    (ii) The following periods of time will not be included in the 
determination of an interest penalty:
    (A) The period taken to notify the Contractor of defects in invoices 
submitted to the Government, but this may not exceed 7 days (3 days for 
meat, meat food products, or fish; 5 days for perishable agricultural 
commodities, dairy products, edible fats or oils, and food products 
prepared from edible fats or oils).
    (B) The period between the defects notice and resubmission of the 
corrected invoice by the Contractor.
    (C) For incorrect electronic funds transfer (EFT) information, in 
accordance with the EFT clause of this contract.
    (iii) Interest penalties will not continue to accrue after the 
filing of a claim for such penalties under the clause at 52.233-1, 
Disputes, or for more than 1 year. Interest penalties of less than $1 
need not be paid.
    (iv) Interest penalties are not required on payment delays due to 
disagreement between the Government and the Contractor over the payment 
amount or other issues involving contract compliance or on amounts 
temporarily withheld or retained in accordance with the terms of the 
contract. Claims involving disputes, and any interest that may be 
payable, will be resolved in accordance with the clause at 52.233-1, 
Disputes.
    (8) Prompt payment discounts. An interest penalty also shall be paid 
automatically by the designated payment office, without request from the 
Contractor, if a discount for prompt payment is taken improperly. The 
interest penalty will be calculated as described in subparagraph (a)(7) 
of this clause on the amount of discount taken for the period beginning 
with the first day after the end of the discount period through the date 
when the Contractor is paid.
    (9) Additional interest penalty.
    (i) If this contract was awarded on or October 1, 1989, a penalty 
amount, calculated in accordance with subdivision (a)(9)(iii) of this 
clause, shall be paid in addition to the interest penalty amount if the 
Contractor--
    (A) Is owed an interest penalty of $1 or more;
    (B) Is not paid the interest penalty within 10 days after the date 
the invoice amount is paid; and
    (C) Makes a written demand to the designated payment office for 
additional penalty payment, in accordance with subdivision (a)(9)(ii) of 
this clause, postmarked not later than 40 days after the invoice amount 
is paid.
    (ii)(A) Contractors shall support written demands for additional 
penalty payments with the following data. No additional data shall be 
required. Contractors shall--
    (1) Specifically assert that late payment interest is due under a 
specific invoice, and request payment of all overdue late payment 
interest penalty and such additional penalty as may be required;
    (2) Attach a copy of the invoice on which the unpaid late payment 
interest was due; and
    (3) State that payment of the principal has been received, including 
the date of receipt.
    (B) Demands must be postmarked on or before the 40th day after 
payment was made, except that--
    (1) If the postmark is illegible or nonexistent, the demand must 
have been received and annotated with the date of receipt by the 
designated payment office on or before the 40th day after payment was 
made; or
    (2) If the postmark is illegible or nonexistent and the designated 
payment office fails to make the required annotation, the demand's 
validity will be determined by the date the Contractor has placed on the 
demand; provided such date is no later than the 40th day after payment 
was made.

[[Page 252]]

    (iii)(A) The additional penalty shall be equal to 100 percent of any 
original late payment interest penalty, except--
    (1) The additional penalty shall not exceed $5,000;
    (2) The additional penalty shall never be less than $25; and
    (3) No additional penalty is owed if the amount of the underlying 
interest penalty is less than $1.
    (B) If the interest penalty ceases to accrue in accordance with the 
limits stated in subdivision (a)(5)(iii) of this clause, the amount of 
the additional penalty shall be calculated on the amount of interest 
penalty that would have accrued in the absence of these limits, subject 
to the overall limits on the additional penalty specified in subdivision 
(a)(7)(iii)(A) of this clause.
    (C) For determining the maximum and minimum additional penalties, 
the test shall be the interest penalty due on each separate payment made 
for each separate contract. The maximum and minimum additional penalty 
shall not be based upon individual invoices unless the invoices are paid 
separately. Where payments are consolidated for disbursing purposes, the 
maximum and minimum additional penalty determination shall be made 
separately for each contract therein.
    (D) The additional penalty does not apply to payments regulated by 
other Government regulations (e.g., payments under utility contracts 
subject to tariffs and regulation).
    (b) Contract financing payments. (1) Due dates for recurring 
financing payments. If this contract provides for contract financing, 
requests for payment shall be submitted to the designated billing office 
as specified in this contract or as directed by the Contracting Officer. 
Contract financing payments shall be made on the [insert day as 
prescribed by Agency head; if not prescribed, insert 30th day] day after 
receipt of a proper contract financing request by the designated billing 
office. In the event that an audit or other review of a specific 
financing request is required to ensure compliance with the terms and 
conditions of the contract, the designated payment office is not 
compelled to make payment by the due date specified.
    (2) Due dates for other contract financing. For advance payments, 
loans, or other arrangements that do not involve recurring submissions 
of contract financing requests, payment shall be in accordance with the 
corresponding contract terms or as directed by the Contracting Officer.
    (3) Interest penalty not applicable. Contract financing payments 
shall not be assessed an interest penalty for payment delays.
    (c) Fast payment procedure due dates. If this contract contains the 
clause at 52.213-1, Fast Payment Procedure, payments will be made within 
15 days after the date of receipt of the invoice.

                             (End of clause)



552.232-70  Invoice Requirements.

    As prescribed in 532.111(a), insert the following clause:

                     Invoice Requirements (SEP 1999)

    (a) Invoices shall be submitted in an original only, unless 
otherwise specified, to the designated billing office specified in this 
contract or order.
    (b) Invoices must include the Accounting Control Transaction (ACT) 
number provided below or on the order.

             ACT Number (Contracting Officer insert number)

    (c) In addition to the requirements for a proper invoice specified 
in the Prompt Payment clause on this contract or order, the following 
information or documentation must be submitted with each invoice:

           (Contracting Officer list additional requirements.)

                             (End of clause)



552.232-71  Adjusting Payments.

    As prescribed in 532.111(b), insert the following clause:

                      Adjusting Payments (SEP 1999)

    (a) Under the Inspection of Services clause of this contract, 
payments may be adjusted if any services do not conform with contract 
requirements. The Contracting Office or a designated representative will 
inform the Contractor, in writing, of the type and dollar amount of 
proposed deductions by the 10th workday of the month following the 
performance period for which the deductions are to be made.
    (b) The Contractor may, within 10 working days of receipt of the 
notification of the proposed deductions, present to the Contracting 
Officer specific reasons why any or all of the proposed deductions are 
not justified. Reasons must be solidly based and must provide specific 
facts that justify reconsideration and/or adjustment of the amount to be 
deducted. Failure to respond within the 10-day period will be 
interpreted to mean that the Contractor accepts the deductions proposed.
    (c) All or a portion of the final payment may be delayed or withheld 
until the Contracting Officer makes a final decision on the proposed 
deduction. If the Contracting

[[Page 253]]

Officer determines that any or all of the proposed deductions are 
warranted, the Contracting Officer shall so notify the Contractor, and 
adjust payments under the contract accordingly.

                             (End of clause)



552.232-72  Final Payment.

    As prescribed in 532.111(c), insert the following clause:

                        Final Payment (SEP 1999)

    Before final payment is made, the Contractor shall furnish the 
Contracting Officer with a release of all claims against the Government 
relating to this contract, other than claims in stated amounts that are 
specifically excepted by the Contractor from the release. If the 
Contractor's claim to amounts payable under the contract has been 
assigned under Assignment of Claims Act of 1940, as amended (31 U.S. 
3727, 41 U.S.C. 15), a release may also be required of the assignee.

                             (End of clause)



552.232-73  Availability of Funds.

    As prescribed in 532.705-1, insert the following clause:

                    Availability of Funds (SEP 1999)

    The authorization of performance of work under this contract during 
the initial contract period and any option or extension period(s) is 
contingent upon the appropriation of funds to procure this service. If 
the contract is awarded, extended, or option(s) exercised, the 
Government's obligation beyond the end of the fiscal year (September 
30), in which the award or extension is made or option(s) exercised, is 
contingent upon the availability of funds from which payment for the 
contract services can be made. No legal liability on the part of the 
Government for payment of any money beyond the end of the each fiscal 
year (September 30) shall arise unless or until funds are made available 
to the Contracting Officer for this procurement and written notice of 
such availability is given to the Contractor.

                             (End of clause)



552.232-74  Invoice Payments.

    As prescribed in 532.908 (a)(1), insert the following clause:

                       Invoice Payments (SEP 1999)

    (a) The due date for making invoice payments by the designated 
payment office is:
    (1) For orders placed electronically by the General Services 
Administration (GSA) Federal Supply Service (FSS), and to be paid by GSA 
through electronic funds transfer (EFT), the later of the following two 
events:
    (i) The 10th day after the designated billing office receives a 
proper invoice from the Contractor. If the designated billing office 
fails to annotate the invoice with the date of receipt at the time of 
receipt, the invoice payment due date shall be the 10th day after the 
date of the Contractor's invoice; provided the Contractor submitted a 
proper invoice and no disagreement exists over quantity, quality, or 
Contractor compliance with contract requirements.
    (ii) The 10th day after Government acceptance of supplies delivered 
or services performed by the Contractor.
    (2) For all other orders, the later of the following two events:
    (i) The 30th day after the designated billing office receives a 
proper invoice from the Contractor. If the designated billing office 
fails to annotate the invoice with the date of receipt at the time of 
receipt, the invoice payment due date shall be the 30th day after the 
date of the Contractor's invoice; provided the Contractor submitted a 
proper invoice and on disagreement exists over quantity, quality, or 
Contractor compliance with contract requirements.
    (ii) The 30th day after Government acceptance of supplies delivered 
or services performed by the Contractor.
    (3) On a final invoice, if the payment amount is subject to contract 
settlement actions, acceptance occurs on the effective date of the 
contract settlement.
    (b) The General Services Administration will issue payment on the 
due date in (a)(1) above if the Contractor complies with full cycle 
electronic commerce. Full cycle electronic commerce includes all the 
following elements:
    (1) The Contractor must receive and fulfill electronic data 
interchange (EDI) purchase orders (transaction set 850).
    (2) The Contractor must generate and submit to the Government valid 
EDI invoices (transaction set 810) of submit invoices through the GSA 
Finance Center Internet-based invoice process. Internet-based invoices 
must be submitted using procedures provided by GSA.
    (3) The Contractor's financial institution must receive and process, 
on behalf of the Contractor, EFT payments through the Automated Clearing 
House (ACH) system.
    (4) The EDI transaction sets in (b)(1) through (b)(3) above must 
adhere to implementation conventions provided by GSA.
    (c) If any of the conditions in (b) above do not occur, the 10-day 
payment due dates in (a)(1) become 30-day payment due dates.
    (d) Notwithstanding paragraph (g) of the clause at FAR 52.212-4, 
Contract Terms and Conditions--Commercial Items, if the Contractor 
submits hard-copy invoices, submit

[[Page 254]]

only an original invoice. No copies of the invoice are required.
    (e) All other provisions of the Prompt Payment Act (31 U.S.C. 3901 
et seq.) and Office of Management and Budget (OMB) Circular A-125, 
Prompt Payment, apply.

                             (End of clause)



552.232-75  Prompt Payment

    As prescribed in 532.908 (b)(1), insert the following clause:

                        Prompt Payment (SEP 1999)

    The Government will make payments under the terms and conditions 
specified in this clause. Payment shall be considered as being made on 
the day a check is dated or an electronic funds transfer is made. All 
days referred to in this clause are calendar days, unless otherwise 
specified.
    (a) Payment due date.
    (1) Rental Payments. Rent shall be paid monthly in arrears and will 
be due on the first workday of each month, and only as provided for by 
the lease.
    (i) When the date for commencement of rent falls on the 15th day of 
the month or earlier, the initial monthly rental payment under this 
contract shall become due on the first workday of the month following 
the month in which the commencement of the rent is effective.
    (ii) When the date for commencement of rent falls after the 15th day 
of the month, the initial monthly rental payment under this contract 
shall become due on the first workday of the second month following the 
month in which the commencement of the rent is effective.
    (2) Other payments. The due date for making payments other than rent 
shall be the later of the following two events:
    (i) The 30th day after the designated billing office has received a 
proper invoice from the Contractor.
    (ii) The 30th day after Government acceptance of the work or 
service. However, if the designated billing office fails to annotate the 
invoice with the actual date of receipt, the invoice payment due date 
shall be deemed to be the 30th day after the Contractor's invoice is 
dated, provided a proper invoice is received and there is no 
disagreement over quantity, quality, or Contractor compliance with 
contract requirements.
    (b) Invoice and inspection requirements for payments other than 
rent.
    (1) The Contractor shall prepare and submit an invoice to the 
designated billing office after completion of the work. A proper invoice 
shall include the following items:
    (i) Names and address of the Contractor.
    (ii) Invoice date.
    (iii) Lease number.
    (iv) Government's order number or other authorization.
    (v) Description, price, and quantity of work or services delivered.
    (vi) Name and address of Contractor official to whom payment is to 
be sent (must be the same as that in the remittance address in the lease 
or the order).
    (vii) Name (where practicable), title, phone number, and mailing 
address of person to be notified in the event of a defective invoice.
    (2) The Government will inspect and determine the acceptability of 
the work performed or services delivered within 7 days after the receipt 
of a proper invoice or notification of completion of the work or 
services unless a different period is specified at the time the order is 
placed. If actual acceptance occurs later, for the purpose of 
determining the payment due date and calculation of interest, acceptance 
will be deemed to occur on the last day of the 7 day inspection period. 
If the work or service is rejected for failure to conform to the 
technical requirements of the contract, the 7 days will be counted 
beginning with receipt of a new invoice or notification. In either case, 
the Contractor is not entitled to any payment or interest unless actual 
acceptance by the Government occurs.
    (c) Interest Penalty. (1) An interest penalty shall be paid 
automatically by the Government, without request from the Contractor, if 
payment is not made by the due date.
    (2) The interest penalty shall be at the rate established by the 
Secretary of the Treasury under Section 12 of the Contract Disputes Act 
of 1978 (41 U.S.C. 611) that is in effect on the day after the due date. 
This rate is referred to as the ``Renegotiation Board Interest Rate,'' 
and it is published in the Federal Register semiannually on or about 
January 1 and July 1. The interest penalty shall accrue daily on the 
payment amount approved by the Government and be compounded in 30-day 
increments inclusive from the first day after the due date through the 
payment date.
    (3) Interest penalties will not continue to accrue after the filing 
of a claim for such penalties under the clause at 52.233-1, Disputes, or 
for more than 1 year. Interest rates penalties of less than $1.00 need 
not be paid.
    (4) Interest penalties are not required on payment delays due to 
disagreement between the Government and Contractor over the payment 
amount or other issues involving contract compliance or on amounts 
temporarily withheld or retained in accordance with the terms of the 
contract. Claims involving disputes, and any interest that may be 
payable, will be resolved in accordance with the clause at 52.233-1, 
Disputes.

                             (End of clause)

    Alternate I (SEP 1999). If Alternate I is used, subparagraph (a)(1) 
of the basic

[[Page 255]]

clause should be designated as paragraph (a) and subparagraph (a)(2) and 
paragraph (b) should be deleted. Paragraph (c) of the basic clause 
should be redesignated (b).



552.232-76  Electronic Funds Transfer Payment.

    As prescribed in 532.908(b)(2), insert the following clause:

              Electronic Funds Transfer Payment (MAR 2000)

    (a) The Government will make payments under this lease by electronic 
funds transfer (EFT). The Lessor must, no later than 30 days before the 
first payment:
    (1) Designate a financial institution for receipt of EFT payments.
    (2) Submit this designation to the Contracting Officer or other 
Government official, as directed.
    (b) The Lessor must provide the following information:
    (1) The American Bankers Association 9-digit identifying number for 
Automated Clearing House (ACH) transfers of the financing institution 
receiving payment if the institution has access to the Federal Reserve 
Communications System.
    (2) Number of account to which funds are to be deposited.
    (3) Type of depositor account (``C'' for checking, ``S'' for 
savings).
    (4) If the Lessor is a new enrollee to the EFT system, the Lessor 
must complete and submit a ``Payment Information Form,'' SF 3881, before 
payment can be processed.
    (c) If the Lessor, during the performance of this contract, elects 
to designate a different financial institution for the receipt of any 
payment, the appropriate Government official must receive notice of such 
change and the required information specified above no later than 30 
days before the date such change is to become effective.
    (d) The documents furnishing the information required in this clause 
must be dated and contain the:
    (1) Signature, title, and telephone number of the Lessor or the 
Lessor's authorized representative.
    (2) Lessor's name.
    (3) Lease number.
    (e) Lessor's failure to properly designate a financial institution 
or to provide appropriate payee bank account information may delay 
payments of amounts otherwise properly due.

                             (End of clause)

[64 FR 37229, July 9, 1999, as amended at 65 FR 11248, Mar. 2, 2000]



552.232-77  Payment By Governmentwide Commercial Purchase Card.

      Payment By Governmentwide Commercial Purchase Card (MAR 2000)

    (a) Definitions. ``Governmentwide commercial purchase card'' means a 
uniquely numbered credit card issued by a contractor under GSA's 
Governmentwide Contract for Fleet, Travel, and purchase Card Services to 
named individual Government employees or entities to pay for official 
Government purchases.
    ``Oral order'' means an order placed orally either in person or by 
telephone.
    (b) At the option of the Government and if agreeable to the 
Contractor, payments of ------*-- or less for oral or written orders may 
be made using the Governmentwide commercial purchase card.
    (c) The Contractor shall not process a transaction for payment 
through the credit card clearinghouse until the purchased supplies have 
been shipped or services performed. Unless the cardholder requests 
correction or replacement of a defective or faulty item under other 
contract requirements, the Contractor must immediately credit a 
cardholder's account for items returned as defective or faulty.
    (d) Payments made using the Governmentwide commercial purchase card 
are not eligible for any negotiated prompt payment discount. Payment 
made using a Government debit card will receive the applicable prompt 
payment discount.

                             (End of clause)

    * Enter amount not to exceed $100,000.
    Alternate I (MAR 2000). For FSS schedule solicitations and 
contracts, replace paragraph (b) of the basic clause and add paragraph 
(c) as follows. Redesignate paragraphs (c) and (d) of the basic clause 
as (d) and (e) respectively.

    (b) The Contractor must accept the Governmentwide commercial 
purchase card for payments equal to or less than the micro-purchase 
threshold (see Federal Acquisition Regulation 2.101) for oral or written 
orders under this contract.
    (c) The Contractor and the ordering agency may agree to use the 
Governmentwide commercial purchase card for dollar amounts over the 
micro-purchase threshold, and the Government encourages the Contractor 
to accept payment by the purchase card. The dollar value of a purchase 
card action must not exceed the ordering agency's established limit. If 
the Contractor will not accept payment by the purchase card for an order 
exceeding the micro-purchase threshold, the

[[Page 256]]

Contractor must so advise the ordering agency within 24 hours of receipt 
of the order.

[65 FR 11248, Mar. 2, 2000]



552.232-78  Payment Information.

    As prescribed in 532.908(c), insert the following information.

                     Payment Information (JUN 2000)

    The General Services Administration (GSA) makes information on 
contract payments available electronically at http://
www.finance.gsa.gov. The Contractor may register at the site and review 
its record of payments. This site provides information only on payments 
made by GSA, not by other agencies.

                             (End of clause)

[65 FR 41379, July 5, 2000]



552.232-79  Payment by Credit Card.

    As prescribed in 532.7003(c) insert the following clause:

                    Payment By Credit Card (MAY 2003)

    (a) Definitions.
    Credit card means any credit card used to pay for purchases, 
including the Governmentwide Commercial Purchase Card.
    Governmentwide commercial purchase card means a uniquely numbered 
credit card issued by a Contractor under GSA's Governmentwide Contract 
for Fleet, Travel, and Purchase Card Services to named individual 
Government employees or entities to pay for official Government 
purchases.
    Oral order means an order placed orally either in person or by 
telephone.
    (b) The Contractor must accept the credit card for payments equal to 
or less than the micro-purchase threshold (see Federal Acquisition 
Regulation 2.101) for oral or written orders under this contract.
    (c) The Contractor and the ordering agency may agree to use the 
credit card for dollar amounts over the micro-purchase threshold, and 
the Government encourages the Contractor to accept payment by the 
purchase card. The dollar value of a purchase card action must not 
exceed the ordering agency's established limit. If the Contractor will 
not accept payment by the purchase card for an order exceeding the 
micro-purchase threshold, the Contractor must so advise the ordering 
agency within 24 hours of receipt of the order.
    (d) The Contractor shall not process a transaction for payment 
through the credit card clearinghouse until the purchased supplies have 
been shipped or services performed.
    Unless the cardholder requests correction or replacement of a 
defective or faulty item under other contract requirements, the 
Contractor must immediately credit a cardholder's account for items 
returned as defective or faulty.
    (e) Payments made using the Governmentwide commercial purchase card 
are not eligible for any negotiated prompt payment discount. Payment 
made using an ordering activity debit card will receive the applicable 
prompt payment discount.

                             (End of clause)

[68 FR 24380, May 7, 2003]



552.232-81  Payments by Non-Federal Ordering Activities.

    As prescribed in 532.206(b), insert the following clause:

         Payments By Non-Federal Ordering Activities (MAY 2003)

    If eligible non-federal ordering activities are subject to a State 
prompt payment law, the terms and conditions of the applicable State law 
apply to the orders placed under this contract by such activities. If 
eligible non-federal ordering activities are not subject to a State 
prompt payment law, the terms and conditions of the Federal Prompt 
Payment Act as reflected in Federal Acquisition Regulation clause 
52.232-25, Prompt Payment, or 52.212-4, Contract Terms and Conditions--
Commercial Items, apply to such activities in the same manner as to 
Federal ordering activities.

                             (End of clause)

[68 FR 24380, May 7, 2003]



552.232-82  Contractor's Remittance (Payment) Address.

    As prescribed in 532.206(c), insert the following provision:

          Contractor's Remittance (Payment) Address (MAY 2003)

    (a) Payment by electronic funds transfer (EFT) is the preferred 
method of payment. However, under certain conditions, the ordering 
activity may elect to make payment by check. The offeror shall indicate 
below the payment address to which checks should be mailed for payment 
of proper invoices submitted under a resultant contract.

 Payment Address:_______________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________
________________________________________________________________________


[[Page 257]]

________________________________________________________________________
    (b) Offeror shall furnish by attachment to this solicitation, the 
remittance (payment) addresses of all authorized participating dealers 
receiving orders and accepting payment by check in the name of the 
Contractor in care of the dealer, if different from their ordering 
address(es) specified elsewhere in this solicitation. If a dealer's 
ordering and remittance address differ, both must be furnished and 
identified as such.
    (c) All offerors are cautioned that if the remittance (payment) 
address shown on an actual invoice differs from that shown in paragraph 
(b) of this provision or on the attachment, the remittance address(es) 
in paragraph (b) of this provision or attached will govern. Payment to 
any other address, except as provided for through EFT payment methods, 
will require an administrative change to the contract.

    Note: All orders placed against a Federal Supply Schedule contract 
are to be paid by the individual ordering activity placing the order. 
Each order will cite the appropriate ordering activity payment address, 
and proper invoices should be sent to that address. Proper invoices 
should be sent to GSA only for orders placed by GSA. Any other ordering 
activity's invoices sent to GSA will only delay your payment.

                           (End of provision)

[68 FR 24380, May 7, 2003]



552.232-83  Contractor's Billing Responsibilities.

    As prescribed in 532.206(d), insert the following clause:

            Contractor's Billing Responsibilities (MAY 2003)

    The Contractor is required to perform all billings made pursuant to 
this contract. However, if the Contractor has dealers that participate 
on the contract and the billing/payment process by the Contractor for 
sales made by the dealer is a significant administrative burden, the 
following alternative procedures may be used. Where dealers are allowed 
by the Contractor to bill ordering activities and accept payment in the 
Contractor's name, the Contractor agrees to obtain from all dealers 
participating in the performance of the contract a written agreement, 
which will require dealers to--
    (1) Comply with the same terms and conditions regarding prices as 
the Contractor for sales made under the contract;
    (2) Maintain a system of reporting sales under the contract to the 
manufacturer, which includes--
    (i) The date of sale;
    (ii) The ordering activity to which the sale was made;
    (iii) The service or product/model sold;
    (iv) The quantity of each service or product/model sold;
    (v) The price at which it was sold, including discounts; and
    (vi) All other significant sales data.
    (3) Be subject to audit by the Government, with respect to sales 
made under the contract; and
    (4) Place orders and accept payments in the name of the Contractor 
in care of the dealer.
    An agreement between a Contractor and its dealers pursuant to this 
procedure will not establish privity of contract between dealers and the 
Government.

                             (End of clause)

[68 FR 24380, May 7, 2003]



552.233-70  Protests Filed Directly With the General Services Administration.

    As prescribed in 533.103-72, insert the following provisions:

 Protests Filed Directly With the General Services Administration (MAR 
                                  2000)

    (a) The following definitions apply in this provision:
    ``Agency Protest Official for GSA'' means the official in the Office 
of Acquisition Policy designated to review ad decide procurement 
protests filed with GSA.
    ``Deciding official'' means the person chosen by the protester to 
decide the agency protest. The deciding official may be either the 
Contracting Officer or the Agency Protest Official.
    (b) The filing time frames in FAR 33.103(e) apply. An agency protest 
is filed when the protest complaint is received at the location the 
solicitation designates for serving protests. GSA's hours of operation 
are 8:00 a.m. to 4:30 p.m. Protests delivered after 4:30 p.m. will be 
considered received and filed the following business day.
    (c) A protest filed directly with the General Services 
Administration (GSA) must:
    (1) Indicate that it is a protest to the agency.
    (2) Be filed with the Contracting Officer.
    (3) State whether the protester chooses to have the Contracting 
Officer or the Agency Protest Official for GSA decide the protest. If 
the protest is silent on this matter, the Contracting Officer will 
decide the protest.
    (4) Indicate whether the protester prefers to make an oral 
presentation, a written presentation, or an oral presentation confirmed 
in writing, of arguments in support of the protest to the deciding 
official.
    (5) Include the information required by FAR 33.103(d)(2):

[[Page 258]]

    (i) Name, address, fax number, and telephone number of the 
protester.
    (ii) Solicitation or contract number.
    (iii) Detailed statement of the legal and factual grounds for the 
protest, to include a description of resulting prejudice to the 
protester.
    (iv) Copies of relevant documents.
    (v) Request for a ruling by the agency.
    (vi) Statement as to the form of relief requested.
    (vii) All information establishing that the protester is an 
interested party for the purpose of filing a protest.
    (viii) All information establishing the timeliness of the protest 
(see paragraph (b) of this provision).
    (d) An interested party filing a protest with GSA has the choice of 
requesting either that the Contracting Officer or the Agency Protest 
Official for GSA decide the protest.
    (e) The decision by the Agency Protest Official for GSA is an 
alternative to a decision by the Contracting Officer. The Agency Protest 
Official for GSA will not consider appeals from the Contracting 
Officer's decision on an agency protest.
    (f) The deciding Official must conduct a scheduling conference with 
the protester within three (3) days after the protest is filed. The 
scheduling conference will establish deadlines for oral or written 
arguments in support of the agency protest and for agency officials to 
present information in response to the protest issues. The deciding 
official may hear oral arguments in support of the agency protest at the 
same time as the scheduling conference, depending on availability of the 
necessary parties.
    (g) Oral conferences may take place either by telephone or in 
person. Other parties (e.g., representatives of the program office) may 
attend at the discretion of the deciding official.
    (h) The following procedures apply to information submitted in 
support of or in response to an agency protest:
    (1) The protester and the agency have only one opportunity to 
support or explain the substance of the protest (either orally, in 
writing, or orally confirmed in writing).
    (2) GSA procedures do not provide for any discovery.
    (3) The deciding official has discretion to request additional 
information from either the agency or the protester. However, the 
deciding official will normally decide protests on the basis of 
information provided by the protester and the agency.
    (4) Except as provided in paragraph (5)(ii) below, the parties are 
encouraged, but not required, to exchange information submitted to the 
Agency Protest Official for GSA.
    (5) If the agency makes a written response to the protest, the 
following filling requirements apply unless the deciding official 
approves other arrangements:
    (i) The agency must file its response to the protest with the 
deciding official within five (5) days after the filing of the protest.
    (ii) The agency must also provide the protester with a copy of the 
response on the same day it files the response with the deciding 
official. If the agency believes it needs to redact or withhold any 
information in the response from the protester, it must obtain the 
approval of the deciding official.
    (i) The deciding official will resolve the protest through informal 
presentations or meetings to the maximum extent practicable.
    (j) An interested party may represent itself or be represented by 
legal counsel. GSA will not reimburse the party for any legal fees 
related to the agency protest.
    (k) GSA will stay award or suspend contract performance in 
accordance with FAR 33.103(f). The stay or suspension, unless over-
ridden, remains in effect until the protest is decided, dismissed, or 
withdrawn.
    (l) The deciding official will make a best effort to issue a 
decision on the protest within twenty-eight (28) days after the filing 
date. The decision may be oral or written. If the decision is 
communicated orally to the protester, the deciding official will confirm 
in writing within three (3) days after the decision.
    (m) GSA may dismiss or stay proceedings on an agency protest if a 
protest on the same or similar basis is filed with a protest forum 
outside of GSA.

                           (End of provision)

[64 FR 37229, July 9, 1999, as amended at 65 FR 11248, Mar. 2, 2000]



552.233-71  Disputes (Utility Contracts).

    As prescribed in 533.215, insert the following clause:

                 Disputes (Utility Contracts) (JAN 2005)

    The requirements of the Disputes clause at FAR 52.233-1 are 
supplemented to provide that matters involving the interpretation of 
tariffed retail rates, tariff rate schedules, and tariffed terms 
provided under this contract are subject to the jurisdiction and 
regulation of the utility rate commission having jurisdiction.

                             (End of clause)

[70 FR 299, Jan. 4, 2005]



552.236-70  Definitions.

    As prescribed in 536.570-1, insert the following clause:

[[Page 259]]

                         Definitions (APR 1984)

    The terms ``Administration'' and ``Service'' as used in this 
contract shall mean the General Services Administration (GSA) and the 
Public Buildings Service (PBS), respectively.

                             (End of clause)



552.236-71  Authorities and Limitations.

    As prescribed in 536.570-2, insert the following clause:

                 Authorities and Limitations (APR 1984)

    (a) All work shall be performed under the general direction of the 
Contracting Officer, who alone shall have the power to bind the 
Government and to exercise the rights, responsibilities, authorities and 
functions vested in him by the contract documents, except that he shall 
have the right to designate authorized representatives to act for him. 
Wherever any provision in this contract specifies an individual (such 
as, but not limited to, Construction Engineer, Resident Engineer, 
Inspector or Custodian) or organization, whether governmental or 
private, to perform any act on behalf of or in the interests of the 
Government, that individual or organization shall be deemed to be the 
Contracting Officer's authorized representative under this contract but 
only to the extent so specified. The Contracting Officer may, at any 
time during the performance of this contract, vest in any such 
authorized representatives additional power and authority to act for him 
or designate additional representatives, specifying the extent of their 
authority to act for him; a copy of each document vesting additional 
authority in an authorized representative or designating an additional 
authorized representative shall be furnished to the Contractor.
    (b) The Contractor shall perform the contract in accordance with any 
order (including but not limited to instruction, direction, 
interpretation, or determination) issued by an authorized representative 
in accordance with his authority to act for the Contracting Officer; but 
the Contractor assumes all the risk and consequences of performing the 
contract in accordance with any order (including but not limited to 
instruction, direction, interpretation, or determination) of anyone not 
authorized to issue such order.

                             (End of clause)



552.236-72  Specialist.

    As prescribed in 536.570-3, insert the following clause:

                          Specialist (APR 1984)

    The term ``Specialist,'' as used in the contract specification, 
shall mean an individual or firm of established reputation (or, if newly 
organized, whose personnel have previously established a reputation in 
the same field), which is regularly engaged in, and which maintains a 
regular force of workmen skilled in either (as applicable) manufacturing 
or fabricating items required by the contract, installing items required 
by the contract, or otherwise performing work required by the contract. 
Where the contract specification requires installation by a specialist, 
that term shall also be deemed to mean either the manufacturer of the 
item, an individual or firm licensed by the manufacturer, or an 
individual or firm who will perform the work under the manufacturer's 
direct supervision.

                             (End of clause)



552.236-73  Basis of Award--Construction Contract.

    As prescribed in 536.570-4, insert the following provision or the 
appropriate Alternate:

            Basis of Award--Construction Contract (APR 1985)

    (a) The low bidder for purposes of award is the responsible bidder 
offering the lowest price for the base bid (consisting of the lump sum 
bid and any associated unit price bids extended by the applicable number 
of units shown on the bid form). See Standard Form 1442, Solicitation, 
Offer, and Award and the provision entitled ``Contract Award--Sealed 
Bidding.''
    (b) A bid may be rejected as nonresponsive if the bid is materially 
unbalanced as to bid prices. A bid is unbalanced when the bid is based 
on prices significantly less than cost for some work and significantly 
overstated for other work.

                           (End of provision)

    Alternate I (APR 1985). if the solicitation includes a base bid and 
options, the Contracting Officer shall delete paragraph (a) of the basic 
provision and insert paragraph (a) substantially as follows:

    (a) The low bidder for purposes of award is the responsible bidder 
offering the lowest aggregate price for (1) the base bid (consisting of 
the lump sum bid and any associated unit price bids extended by the 
applicable number of units shown on the bid form) plus (2) all

[[Page 260]]

options designated to be evaluated. The evaluation of options will not 
obligate the Government to exercise the options. See Standard Form 1442, 
Solicitation, Offer, and Award and the provision entitled ``Contract 
Award--Sealed Bidding.''
    Alternate II (APR 1985). If the solicitation includes a base bid and 
alternates, the Contracting Officer shall delete paragraph (a) of the 
basic provision and insert paragraphs (a), (c), and (d) substantially as 
follows:

    (a) The low bidder for purposes of award is the responsible bidder 
offering the lowest aggregate price for (1) the base bid (consisting of 
the lump sum bid and any associated unit price bids extended by the 
applicable number of units shown on the bid form) plus (2) those 
alternates in the order of priority listed in the solicitation that 
provide the most features of work within the funds available at bid 
opening. See the provision entitled ``Contract Award--Sealed Bidding.''
    (c) Alternates will be added to the base bid in the order listed in 
the solicitation (see Standard Form 1442, Solicitation, Offer, and 
Award). If the addition of an alternate would make all bids exceed the 
funds available at bid opening, that alternate shall be skipped and the 
next subsequent alternate in a lower amount shall be added, provided 
that the aggregate of base bid and the selected alternates do not exceed 
the funds available at bid opening. For example, when the amount 
available is $100,000 and a bidder's base bid is $85,000, with its 
separate bids on four successive alternatives being $10,000, $8,000, 
$6,000, and $4,000, the aggregate amount of the bid for purposes of 
selecting the alternates would be $99,000 (base bid plus the first and 
four alternates). The second and third alternates are skipped because 
each of them would cause the aggregate of the base bid and alternates to 
exceed the $100,000 amount available when considered with the first 
alternate. All bids shall be evaluated on the basis of the same 
alternates.
    (d) After the low bidder has been determined in accordance with 
paragraph (a), an award may be made to that low bidder on the base bid, 
plus any combination of alternates for which funds are available at the 
time of award, but only if the award amount does not exceed the amount 
offered by any other responsible bidder. If the base bid plus the 
proposed combination of alternates exceed the amount offered by any 
other responsible bidder for the same combination of alternates, the 
award cannot be made on that combination of alternates.

    Alternate III (APR 1985). If the solicitation includes a base bid, 
alternates, and options, the Contracting Officer shall delete paragraph 
(a) of the basic provision and insert paragraphs (a), (c), and (d) 
substantially as follows:

    (a) The low bidder for purposes of award is the responsible bidder 
offering the lowest aggregate price for (1) the base bid (consisting of 
the lump sum bid and any associated unit price bids extended by the 
applicable number of units shown on the bid form) plus (2) those 
alternates in the order of priority listed in the solicitation that 
provide the most features of work within the funds available at bid 
opening plus (3) all options designated to be evaluated except those 
options associated with alternates which are skipped during the 
selection process outlined in paragraph (c) below. The evaluation of 
options will not obligate the Government to exercise the options. See 
the provision entitled ``Contract Award--Sealed Bidding.''
    (c) Alternates will be added to the base bid in the order listed in 
the solicitation (see Standard Form 1442, Solicitation, Offer, or 
Award). If the addition of an alternate would make all bids exceed the 
funds available at bid opening, that alternate shall be skipped and the 
next subsequent alternate in a lower amount shall be added, provided 
that the aggregate of base bid and the selected alternates do not exceed 
the funds available at bid opening. For example, when the amount 
available is $100,000 and a bidder's base bid is $85,000, with its 
separate bids on four successive alternates being $10,000, $8,000, 
$6,000, and $4,000, the aggregate amount of the bid for purposes of 
selecting the alternates would be $99,000 (base bid plus the first and 
fourth alternates). The second and third alternates are skipped because 
each of them would cause the aggregate of the base bid and alternates to 
exceed the $100,000 amount available when considered with the first 
alternate. All bids shall be evaluated on the basis of the same 
alternates.
    (d) After the low bidder has been determined in accordance with 
paragraph (a), award may be made to that low bidder on the base bid and 
evaluated options plus any combination of alternates for which funds are 
available at the time of award, but only if that low bidder is still low 
on the sum thereof plus any previously unevaluated options designated to 
be evaluated which are associated with proposed alternates that were 
skipped during the selection under paragraph (c). If that low bidder is 
not still low, award cannot be made on the proposed combination of 
alternates.



552.236-74  Working Hours.

    As prescribed in 536.570-5, insert the following clause:

                        Working Hours (APR 1984)

    (a) It is contemplated that all work will be performed during the 
customary working

[[Page 261]]

hours of the trades involved unless otherwise specified in this 
contract. Work performed by the Contractor at his own volition outside 
such customary working hours shall be at no additional expense to the 
Government.
    (b) Any requests received by the Contractor from occupants of 
existing buildings to change the hours of work shall be referred to the 
Contracting Officer for determination.

                             (End of clause)



552.236-75  Use of Premises.

    As prescribed in 536.570-6, insert the following clause:

                       Use of Premises (APR 1984)

    (a) If the premises are occupied, the Contractor, his 
subcontractors, and their employees shall comply with the regulations 
governing access to, operation of, and conduct while in or on the 
premises and shall perform the work required under this contract in such 
a manner as not to unreasonably interrupt or interfere with the conduct 
of Government business.
    (b) Any request received by the Contractor from occupants of 
existing buildings to change the sequence of work shall be referred to 
the Contracting Officer for determination.
    (c) If the premises are occupied, the Contractor, his subcontractors 
and their employees shall not have access to or be admitted into any 
building outside the scope of this contract except with official 
permission.

                             (End of clause)



552.236-76  Measurements.

    As prescribed in 536.570-7, insert the following clause:

                         Measurements (APR 1984)

    All dimensions shown of existing work and all dimensions required 
for work that is to connect with work now in place, shall be verified by 
the Contractor by actual measurement of the existing work. Any 
discrepancies between the contract requirements and the existing 
conditions shall be referred to the Contracting Officer before any work 
affected thereby has been performed.

                             (End of clause)



552.236-77  Specifications and Drawings

    As prescribed in 536.570-8, insert the following clause:

                 Specifications and Drawings (SEP 1999)

    The requirements of the clause entitled ``Specifications and 
Drawings for Construction'' at FAR 52.236-21, are supplemented as 
follows:
    (a) In case of difference between small and large-scale drawings, 
the large-scale drawings shall govern. Schedules on any contract drawing 
shall take precedence over conflicting information on that or any other 
contract drawing. On any of the drawings where a portion of the work is 
detailed or drawn out and the remainder is shown in outline, the parts 
detailed or drawn out shall apply also to all other like portions of the 
work.
    (b) Where the word ``similar'' occurs on the drawings, it shall have 
a general meaning and not be interpreted as being identical, and all 
details shall be worked out in relation to their location and their 
connection with other parts of the work.
    (c) Standard Details or Specification Drawings are applicable when 
listed, bound with the specifications, noted on the drawings or 
referenced elsewhere in the specifications. Where the notes on the 
drawings indicate modifications, such modifications shall govern.
    (d) In case of difference between Standard Details or Specification 
Drawings and the specifications, the specifications will govern. In case 
of difference between the Standard Details or Specification Drawings and 
their drawings prepared specifically for this contract, the later shall 
govern.

                             (End of clause)



552.236-78  Shop Drawings, Coordination Drawings, and Schedules.

    As prescribed in 536.570-9, insert the following clause:

     Shop Drawings, Coordination Drawings, and Schedules (SEP 1999)

    The requirements, of the clause entitled ``Specifications and 
Drawings for Construction'' at FAR 52.236-21, are supplemented as 
follows:
    (a) The Contractor shall submit shop drawings, coordination 
drawings, and schedules for approval as required by the specifications 
or requested by the Contracting Officer as follows:
    (b) Show drawings shall include fabrication, erection and setting 
drawings, schedule drawings, manufacturers' scale drawings, wriring and 
control diagrams, cuts or entire catalogs, pamphlets, descriptive 
literature, and performance and test data.
    (c) Drawings and schedules, other than catalogs, pamphlets and 
similar printed material, shall be submitted in reproducible form with 
two prints made by a process approved by the Contracting Officer. Upon 
approval, the reproducible form will be returned to the Contractor who 
shall then furnish the number of additional prints, not to

[[Page 262]]

exceed 10, required by the specifications. The Contractor shall submit 
shop drawings in catalog, pamphlet and similar printed form in a minimum 
of four copies plus as many additional copies as the Contractor may 
desire or need for his use or use by subcontractors.
    (d) Before submitting shop drawings on the mechanical and electrical 
work, the Contractor shall submit and obtain the Contracting Officer's 
approval of such lists of mechanical and electrical equipment and 
materials as may be required by the specifications.
    (e) Each shop drawing or coordination drawing shall have a blank 
area 5 by 5 inches, located adjacent to the title block. The title block 
shall display the following:

Number and title of drawing
Date of drawing or revision
Name of project building or facility
Name of Contractor and (if appropriate) name of subcontractor submitting 
drawing
Clear identify of contents and location on the work
Project title and contract number

    (f) Unless otherwise provided in this contract, or otherwise 
directed by the Contracting Officer, shop drawings, coordination 
drawings and schedules shall be submitted to the Contracting Officer, 
with a letter in triplicate, sufficiently in advance of construction 
requirements to permit no less than 10 working days for checking and 
appropriate action.
    (g) Approval of drawings and schedules will be general and shall not 
be construed as permitting any departure from the contract requirements, 
or as approving departures from full-size details furnished by the 
Contracting Officer.

                             (End of clause)



552.236-79  Samples.

    As prescribed in 536.570-10, insert the following clause:

                           Samples (APR 1984)

    (a) After the award of the contract, the Contractor shall furnish 
for the approval of the Contracting Officer samples required by the 
specifications or by the Contracting Officer. Samples shall be delivered 
to the Contracting Officer or to the Architect as specified or as 
directed. The Contractor shall prepay all shipping charges on samples. 
Materials or equipment for which samples are required shall not be used 
in the work until approved in writing by the Contracting Officer.
    (b) Each sample shall have a label indicating:
    (1) Name of project building or facility, project title and contract 
number.
    (2) Name of Contractor and, if appropriate, name of subcontractor.
    (3) Identification of material or equipment with specification 
requirement.
    (4) Place of origin.
    (5) Name of producer and brand (if any).
    Samples of finished materials shall have additional markings that 
will identify them under the finish schedules.
    (c) The Contractor shall mail under separate cover a letter in 
triplicate submitting each shipment of samples and containing the 
information required in paragraph (b) of this clause. He shall enclose a 
copy of this letter with the shipment and send a copy to the Government 
representative on the project. Approval of a sample shall be only for 
the characteristics or use named in such approval and shall not be 
construed to change or modify any contract requirement. Substitutions 
will not be permitted unless they are approved in writing by the 
Contracting Officer.
    (d) Approved samples not destroyed in testing will be sent to the 
Government representative at the project. Approved samples of hardware 
in good condition will be marked for identification and may be used in 
the work. Materials and equipment, incorporated in the work shall match 
the approved samples. Other samples not destroyed in testing or not 
approved will be returned to the Contractor at his expense if so 
requested at time of submission.
    (e) Failure of any material to pass the specified tests will be 
sufficient cause for refusal to consider, under this contract, any 
further samples of the same brand or make of that material or equipment 
which previously has proved unsatisfactory in service.
    (f) Samples of various materials or equipment delivered on the site 
or in place may be taken by the Government representative for testing. 
Samples failing to meet contract requirements, or there shall be a 
proper adjustment of the contract price as determined by the Contracting 
Officer.
    (g) Unless otherwise specified, when tests are required only one 
test of each sample proposed for use will be made at the expense of the 
Government. Samples which do not meet specification requirements will be 
rejected. Testing of additional samples will be made by the Government 
at the expense of the Contractor.

                             (End of clause)



552.236-80  Heat.

    As prescribed in 536.570-11, insert the following clause:

                             Heat (APR 1984)

    Unless otherwise specified or unless already provided by the 
Government the Contractor shall;

[[Page 263]]

    (a) Provide heat, as necessary to protect all work, materials, and 
equipment against injury from dampness and cold;
    (b) Protect, cover and/or heat as may be necessary, to provide and 
maintain a temperature of not less than 50 degrees Fahrenheit (1) in the 
concrete during the placing, setting and curing of concrete, and (2) in 
the plaster during the application, setting and curing of plaster; and
    (c) Provide heat as necessary in the area where work is to be done 
to provide the minimum temperature recommended by the supplier or 
manufacturer of the material, but in no case less than 50 degrees 
Fahrenheit, for a period beginning 10 days before placing or interior 
finishes and finish materials and continuing until completion or 
beneficial occupancy of the area, whichever is earlier.

                             (End of clause)



552.236-81  Use of Equipment by the Government.

    As prescribed in 536.570-12, insert the following clause:

              Use of Equipment by the Government (APR 1984)

    (a) The Government may take over and operate, with Government 
employees, such equipment as is necessary for heating or cooling such 
areas of the building as require the service, as soon as the 
installation is sufficiently complete.
    (b) The Contracting Officer will advise the Contractor by letter, 
prior to the use of equipment, which items of equipment will be 
operated, and the date and time such operation will begin.
    (c) Government operation of equipment will not relieve the 
Contractor of the one-year guarantee on materials and workmanship 
elsewhere provided for in this contract.
    (d) The guarantee period, elsewhere provided for in this contact, 
for each piece of equipment shall be in accordance with the 
``Guarantees'' clause of this contract.

                             (End of clause)



552.236-82  Subcontracts.

    As prescribed in 536.570-13, insert the following clause:

                         Subcontracts (APR 1984)

    (a) Nothing contained in the contract shall be construed as creating 
any contractual relationship between any subcontractor and the 
Government. The divisions or sections of the specifications are not 
intended to control the Contractor in dividing the work among 
subcontractors, or to limit the work performed by any trade.
    (b) The Contractor shall be responsible to the Government for acts 
and omissions of his own employees and of subcontractors and their 
employees. He shall also be responsible for the coordination of the work 
of the trades, subcontractors and suppliers.
    (c) The Government will not undertake to settle any differences 
between or among the Contractor, subcontractors, or suppliers.

                             (End of clause)



552.236-83  Requirement for a Project Labor Agreement.

    As prescribed in 536.570-14, insert a clause substantially the same 
as the following:

          Requirement for a Project Labor Agreement (SEP 1999)

    (a) Definition. ``Project Labor Agreement'' (PLA) means an agreement 
between the contractor, subcontractors, and the union(s) representing 
workers. Under a PLA, the contractor and subcontractors on a project and 
the union(s) agree on terms and conditions of employment for the 
project, establishing a framework for labor-management cooperation to 
advance the Government's procurement interest in cost, efficiency, and 
quality.
    (b) The Contractor shall, after contract award, enter into a PLA for 
performance of [Insert project or contract name]. The PLA binds the 
Contractor and subcontractors of whatever tier engaged in onsite 
construction work. The PLA shall include all the following terms:
    (1) Guarantees against strikes, lockouts, and similar work 
disruptions.
    (2) Effective, prompt and mutually binding procedures for resolving 
labor disputes arising during the project.
    (3) Other mechanisms for labor-management cooperation on matters of 
mutual interest and concern, including productivity, quality of work, 
safety, and health.
    (4) The PLA shall fully conform to all applicable statutes, 
regulations, and Executive Orders.
    (c) Any PLA reached under this clause shall not change the terms of 
this contract or provide for any pricing adjustment by the Government.
    (d) The Government shall not participate in the negotiations of any 
PLA.
    (e) Nothing in this clause precludes contractors or subcontractors 
from competing for contracts or subcontracts on this project without 
discrimination based on union or non-union status.

[[Page 264]]

                             (End of clause)



552.237-70  Qualifications of Offerors.

    As prescribed in 537.110(a), insert the following provision:

                  Qualifications of Offerors (MAY 1989)

    (a) Offers will be considered only from responsible organizations or 
individuals now or recently engaged in the performance of building 
service contracts comparable to those described in this solicitation. In 
order to determine an Offeror's qualifications, the Offeror may be 
requested to furnish a narrative statement listing comparable contracts 
which it has performed; a general history of its operating organization; 
and its complete experience. An Offeror may also be required to furnish 
a statement of its financial resources; show that it has the ability to 
maintain a staff of regular employees adequate to ensure continuous 
performance of the work; and, demonstrate that its equipment and/or 
plant capacity for the work contemplated is sufficient, adequate, and 
suitable.
    (b) Competency in performing comparable building service contracts, 
demonstration of acceptable financial resources, personnel staffing, 
plant, equipment, and supply sources will be considered in determining 
whether an Offeror is responsible.
    (c) Prospective Offerors are advised that in evaluating these areas 
involving any small business concern(s), any negative determinations are 
subject to the Certificate of Competency procedures set forth in the 
Federal Acquisition Regulation.

                           (End of provision)



552.237-71  Qualifications of Employees.

    As prescribed in 537.110(b), insert the following clause:

                 Qualifications of Employees (MAY 1989)

    (a) The contracting officer or a designated representative may 
require the Contractor to remove any employee(s) from GSA controlled 
buildings or other real property should it be determined that the 
individual(s) is either unsuitable for security reasons or otherwise 
unfit to work on GSA controlled property.
    (b) The Contractor shall fill out and cause all of its employees 
performing work on the contract work to fill out, for submission to the 
Government, such forms as may be necessary for security or other 
reasons. Upon request of the Contracting Officer, the Contractor and its 
employees shall be fingerprinted.
    (c) Each employee of the Contractor shall be a citizen of the United 
States of America, or an alien who has been lawfully admitted for 
permanent residence as evidenced by Alien Registration Receipt Card Form 
I-151, or, who presents other evidence from the Immigration and 
Naturalization Service that employment will not affect his immigration 
status.

                             (End of clause)



552.237-72  Prohibition Regarding ``Quasi-Military Armed Forces.''

    As prescribed in 537.110(c), insert the following clause:

    Prohibition Regarding ``Quasi-Military Armed Forces'' (SEP 1999)

    The Contractor must not, during the term of this contract, offer for 
hire ``Quasi-Military Armed Forces'' within the meaning of the court 
decision in United States ex. rel. Weinberger v. Equifax, 557 F.2d 456 
(5th Cir. 1977).

                             (End of clause)



552.237-73  Restriction on Disclosure of Information.

    As prescribed in 537.270, insert the following clause:

           Restriction on Disclosure of Information (SEP 1999)

    (a) The Contractor shall, in the performance of this contract, keep 
all information contained in source documents or other media furnished 
by the Government in the strictest confidence. The Contractor shall not 
publish or otherwise divulge such information in whole or in part, in 
any manner or form, nor authorize or permit others to do so. The 
Contractor shall take such reasonable measures as are necessary to 
restrict access to such information, while in the Contractor's 
possession, to those employees needing such information to perform the 
work provided herein, i.e., on a ``need to know'' basis. The Contractor 
shall immediately notify, in writing, the Contracting Officer in the 
event that the Contractor determines or has reason to suspect a breach 
of this requirement.
    (b) The Contractor shall not disclose any information concerning the 
work under this contract to any person or individual unless the 
Contractor obtains prior written approval from the Contracting Officer.
    (c) The Contractor shall insert the substance of this clause in any 
consultant agreement or subcontract under this contract.
    (d) Any unauthorized disclosure of information may result in 
termination of this contract for cause.

[[Page 265]]

                             (End of clause)



552.238-70  Identification of Electronic Office Equipment Providing Accessibility for the Handicapped.

    As prescribed in 538.273(a)(1), insert the following clause:

 Identification of Electronic Office Equipment Providing Accessibility 
                     for the Handicapped (SEP 1991)

    (a) Definitions. ``Electronic office equipment accessiblity'' means 
the application/configuration of electronic office equipment (includes 
hardware, software and firmware) in a manner that accommodates the 
functional limitations of individuals with disabilities (i.e., 
handicapped individuals) so as to promote productivity and provide 
access to work related and/or public information resources.
    ``Handicapped individuals'' mean qualified individuals with 
impairments as cited in 29 CFR 1613.702(f) who can benefit from 
electronic office equipment accessibility.
    ``Special peripheral'' means a special needs aid that provides 
access to electronic equipment that is otherwise inaccessible to a 
handicapped individual.
    (b) The offeror is encouraged to identify in its offer, and include 
in any commercial catalogs and pricelists accepted by the Contracting 
Officer, office equipment, including any special peripheral, that will 
facilitate electronic office equipment accessibility for handicapped 
individuals. Identification should include the type of disability 
accommodated and how the users with that disability would be helped.

                             (End of clause)



552.238-71  Submission and Distribution of Authorized FSS Schedule Pricelists.

    As prescribed in 538.273(a)(2), insert the following clause:

 Submission and Distribution of Authorized FSS Schedule Pricelists (SEP 
                                  1999)

    (a) Definition. For the purposes of this clause, the Mailing List is 
[Contracting officer shall insert either: ``the list of addressees 
provided to the Contractor by the Contracting Officer'' or ``the 
Contractor's listing of its Federal Government customers''].
    (b) The Contracting Officer will return one copy of the Authorize 
FSS Schedule Pricelist to the Contractor with the notification of 
contract award.
    (c)(1) The Contractor shall provide to the GSA Contracting Officer:
    (i) Two paper copies of Authorized FSS Schedule Pricelist; and
    (ii) The Authorized FSS Schedule Pricelist on a common-use 
electronic medium.
    The Contracting Officer will provide detailed instructions for the 
electronic submission with the award notification. Some structured data 
entry in a prescribed format may be required.
    (2) The Contractor shall provide to each addressee on the mailing 
list either:
    (i) One paper copy of the Authorized FSS Schedule Price List; or
    (ii) A self-addressed, postage-paid envelope or postcard to be 
returned by addressee that want to receive a paper copy of the 
pricelist. The Contractor shall distribute price lists within 20 
calendar days after receipt of returned requests.
    (3) The Contractor shall advise each addressee of the availability 
of pricelist information through the on-line Multiple Award Schedule 
electronic data base.
    (d) The Contractor shall make all of the distributions required in 
paragraph (c) at least 15 calendar days before the beginning of the 
contract period, or within 30 calendar days after receipt of the 
Contracting Officer's approval for printing, whichever is later.
    (e) During the period of the contract, the Contractor shall provide 
one copy of its Authorized FSS Schedule Pricelist to any authorized 
schedule user, upon request. Use of the mailing list for any other 
purpose is not authorized.

                             (End of clause)

    Alternate I (MAY 2003). As prescribed in 538.273(a)(2), substitute 
the following paragraph (a) for paragraph (a) of the basic clause:

    (a) Definition. For the purposes of this clause, the Mailing List is 
[Contracting officer shall insert either: ``the list of addressees 
provided to the Contractor by the Contracting Officer'' or ``the 
Contractor's listing of its ordering activity customers''].

[64 FR 37229, July 9, 1999, as amended at 68 FR 24381, May 7, 2003]



552.238-72  Identification of Products That Have Environmental Attributes.

    As prescribed in 538.273(a)(3), insert the following clause:

Identification of Products That Have Environmental Attributes (SEP 2003)

    (a) Several laws, Executive orders, and Agency directives require 
Federal buyers to purchase products that are less harmful to the 
environment, when they are life cycle cost-effective (see FAR Subpart 
23.7). The U.S. General Services Administration (GSA)

[[Page 266]]

requires contractors to highlight environmental products under Federal 
Supply Service schedule contracts in various communications media (e.g., 
publications and electronic formats).
    (b) Definitions. As used in this clause--
    Energy-efficient product means a product that--
    (1) Meets Department of Energy and Environmental Protection Agency 
criteria for use of the ENERGY STAR [reg] trademark label; or
    (2) Is in the upper 25 percent of efficiency for all similar 
products as designated by the Department of Energy's Federal Energy 
Management Program.
    GSA Advantage! is an on-line shopping mall and ordering system that 
provides customers with access to products and services under GSA 
contracts.
    Other environmental attributes refers to product characteristics 
that provide environmental benefits, excluding recovered materials and 
energy and water efficiency. Several examples of these characteristics 
are biodegradable, recyclable, reduced pollutants, ozone safe, and low 
volatile organic compounds (VOCs).
    Post-consumer material means a material or finished product that has 
served its intended use and has been discarded for disposal or recovery, 
having completed its life as a consumer item. Post-consumer material is 
part of the broader category of ``recovered material.'' The 
Environmental Protection Agency (EPA) has developed a list of EPA-
designated products in their Comprehensive Procurement Guidelines (CPGs) 
to provide Federal agencies with purchasing recommendations on specific 
products in a Recovered Materials Advisory Notice (RMAN). The RMAN 
contains recommended recovered and post-consumer material content levels 
for the specific products designated by EPA (40 CFR part 247 and http://
www.epa.gov/cpg/).
    Recovered materials means waste materials and by-products recovered 
or diverted from solid waste, but the term does not include those 
materials and by-products generated from, and commonly reused within, an 
original manufacturing process (Executive Order 13101 and 42 U.S.C. 
6903(19) and http://www.epa.gov/cpg/). For paper and paper products, see 
the definition at FAR 11.301 (42 U.S.C. 6962(h)).
    Remanufactured means factory rebuilt to original specifications.
    Renewable energy means energy produced by solar, wind, geothermal, 
and biomass power.
    Renewable energy technology means--
    (1) Technologies that use renewable energy to provide light, heat, 
cooling, or mechanical or electrical energy for use in facilities or 
other activities; or
    (2) The use of integrated whole-building designs that rely upon 
renewable energy resources, including passive solar design.
    (c)(1) The offeror must identify products that--
    (i) Are compliant with the recovered and post-consumer material 
content levels recommended in the Recovered Materials Advisory Notices 
(RMANs) for EPA-designated products in the CPG program (http://
www.epa.gov/cpg/);
    (ii) Contain recovered materials that either do not meet the 
recommended levels in the RMANs or are not EPA-designated products in 
the CPG program (see FAR 23.401 and http://www.epa.gov/cpg/);
    (iii) Are energy-efficient, as defined by either ENERGY STAR 
[reg] and/or FEMP's designated top 25th percentile levels 
(see ENERGY STAR [reg] at http://www.energystar.gov/ and FEMP 
at http://www.eere.energy.gov/femp/procurement/);
    (iv) Are water-efficient;
    (v) Use renewable energy technology;
    (vi) Are remanufactured; and
    (vii) Have other environmental attributes.
    (2) These identifications must be made in each of the offeror's 
following mediums:
    (i) The offer itself.
    (ii) Printed commercial catalogs, brochures, and pricelists.
    (iii) Online product website.
    (iv) Electronic data submission for GSA Advantage! submitted via 
GSA's Schedules Input Program (SIP) software or the Electronic Data 
Inter-change (EDI). Offerors can use the SIP or EDI methods to indicate 
environmental and other attributes for each product that is translated 
into respective icons in GSA Advantage!.
    (d) An offeror, in identifying an item with an environmental 
attribute, must possess evidence or rely on a reasonable basis to 
substantiate the claim (see 16 CFR part 260, Guides for the Use of 
Environmental Marketing Claims). The Government will accept an offeror's 
claim of an item's environmental attribute on the basis of--
    (1) Participation in a Federal agency-sponsored program (e.g., the 
EPA and DOE ENERGY STAR [reg] product labeling program);
    (2) Verification by an independent organization that specializes in 
certifying such claims; or
    (3) Possession of competent and reliable evidence. For any test, 
analysis, research, study, or other evidence to be ``competent and 
reliable,'' it must have been conducted and evaluated in an objective 
manner by persons qualified to do so, using procedures generally 
accepted in the profession to yield accurate and reliable results.

                             (End of clause)

[68 FR 52128, Sept. 2, 2003]

[[Page 267]]



552.238-73  Cancellation.

    As prescribed in 538.273(a)(4), insert the following clause:

                         Cancellation (SEP 1999)

    Either party may cancel this contract in whole or in part by 
providing written notice. The cancellation will take effect 30 calendar 
days after the other party receives the notice of cancellation. If the 
Contractor elects to cancel this contract, the Government will not 
reimburse the minimum guarantee.

                             (End of clause)



552.238-74  Industrial Funding Fee and Sales Reporting.

    As prescribed in 538.273(b)(1), insert the following clause:

         Industrial Funding Fee and Sales Reporting (JULY 2003)

    (a) Reporting of Federal Supply Schedule Sales. The Contractor shall 
report all contract sales under this contract as follows:
    (1) The Contractor shall accurately report the dollar value, in U.S. 
dollars and rounded to the nearest whole dollar, of all sales under this 
contract by calendar quarter (January 1-March 31, April 1-June 30, July 
1-September 30, and October 1-December 31). The dollar value of a sale 
is the price paid by the Schedule user for products and services on a 
Schedule task or delivery order. The reported contract sales value shall 
include the Industrial Funding Fee (IFF). The Contractor shall maintain 
a consistent accounting method of sales reporting, based on the 
Contractor's established commercial accounting practice. The acceptable 
points at which sales may be reported include--
    (i) Receipt of order;
    (ii) Shipment or delivery, as applicable;
    (iii) Issuance of an invoice; or
    (iv) Payment.
    (2) Contract sales shall be reported to FSS within 30 calendar days 
following the completion of each reporting quarter. The Contractor shall 
continue to furnish quarterly reports, including ``zero'' sales, through 
physical completion of the last outstanding task order or delivery order 
of the contract.
    (3) Reportable sales under the contract are those resulting from 
sales of contract items to authorized users unless the purchase was 
conducted pursuant to a separate contracting authority such as a 
Governmentwide Acquisition Contract (GWAC); a separately awarded FAR 
Part 12, FAR Part 13, FAR Part 14, or FAR Part 15 procurement; or a non-
FAR contract. Sales made to state and local governments under 
Cooperative Purchasing authority shall be counted as reportable sales 
for IFF purposes.
    (4) The Contractor shall electronically report the quarterly dollar 
value of sales, including ``zero'' sales, by utilizing the automated 
reporting system at an Internet website designated by the General 
Services Administration (GSA)'s Federal Supply Service (FSS). Prior to 
using this automated system, the Contractor shall complete contract 
registration with the FSS Vendor Support Center (VSC). The website 
address, as well as registration instructions and reporting procedures, 
will be provided at the time of award. The Contractor shall report sales 
separately for each National Stock Number (NSN), Special Item Number 
(SIN), or sub-item.
    (5) The Contractor shall convert the total value of sales made in 
foreign currency to U.S. dollars using the ``Treasury Reporting Rates of 
Exchange'' issued by the U.S. Department of Treasury, Financial 
Management Service. The Contractor shall use the issue of the Treasury 
report in effect on the last day of the calendar quarter. The report is 
available from Financial Management Service, International Funds Branch, 
Telephone: (202) 874-7994, Internet: http://www.fms.treas.gov/intn.html.
    (b) The Contractor shall remit the IFF at the rate set by GSA's FSS.
    (1) The Contractor shall remit the IFF to FSS in U